The Economics of Personal Space

Ibrahim Alloush


This paper focuses on the economic dimension of interpersonal distances, and how they are essentially culturally and economically determined and rationed.  Its purpose is to trace the linkages between social psychology and economic theory in the field of personal space studies.  It concludes with a few applications on regional economics in particular on the rental price of land and housing, and transportation.

Prelude: During the seventies and the eighties, Japanese car makers increased their shares in world and U.S. markets threatening Detroit with extinction, and heralding the new era of the economy car.  No longer was the great American highway dominated by mostly born-in-the-USA wheels.  And the smaller culprit was, much to the lament of the bigger American gas guzzler, more energy-efficient, cheaper, albeit less spacious.  The new Japanese product was more in tune with the economic, ecological, demographic, and spatial rhythm of the times.  It took the lead in fulfilling an emerging need: to adapt to a growing population straining the environment with an insatiable demand for resources in a world that needs not only to be energy-wise, but also one that can afford each of its inhabitants less and less space!


The compact and economy car foots the bill at least in comparison to the luxurious space of the American auto before the eighties.  But who could think in such small terms successfully?


Only those who are comfortable in small confines and who can be graceful within their limits, those who have internalized the concept of space to the point where its manipulation becomes feasible can accomplish such deeds.  It was the Japanese who did it because the environment they grew up in prepared them.  A report in Landscape in 1970 indicates that indoors, studying, eating, sleeping, or socializing occur in any of the few small rooms of the Japanese house.  Outdoors, children play in a street, about twelve feet wide, with no sidewalks, which is already jammed with people and cars.


"Utility poles ... become formidable obstacles to speedy Datsuns, and are, therefore, used by children to provide protection for their portable playgrounds ... The drainage ditch (mizo) between the street and buildings is an extremely effective traffic control device.  Anyone who inadvertently drives into an open mizo develops an active respect for places cars are not supposed to go.  Again, children find the narrow place between the drain and the house good for making mud pies on straw mats and relatively safe from the interference of parents and pedestrians, as well as from vehicles of all kinds."  (Smith 70, p.8).



It is the contention of this paper that a higher spatial density indoors and outdoors forces one to adjust by decreasing his or her vital personal space.  This translates into shorter observed interpersonal distances during social interaction.  That does not necessarily imply, however, a lower degree of preferred privacy as Marshall (1972) and Traver (1984) inferred.  Interpersonal distance is only one of several mechanisms that regulate privacy.  Altman (1977) demonstrated that privacy is a process that occurs in all cultures but differed among cultures in terms of the behavioral mechanisms adopted to regulate its desired levels (p. 66).  Eye contact, verbal disclosure, smiling, partitions and walls, and social practices could all be manipulated to obtain more privacy when interpersonal distance is involuntarily close.  Privacy itself could be described as the selective control of access to the self and group (Altman 1975), the regulation of social interaction to enhance autonomy (Rapoport 1975), and as composed of dimensions of solitude, isolation, anonymity, and reserve (Westin 1970) that may not be correlated to each other (Pedersen 1979).


Nevertheless, and any which way privacy is defined, another factor that could explain shorter interpersonal distances and less overall preference for privacy, in addition to density, is the degree to which primary groups, such as family, clan, tribe, sect, etc, ...  predominate in the life of the individual, as a self that is actualized through social units would be less self-contained.  Indirect support for this auxiliary hypothesis is inferred from the work of Webb et al. (1986) who determined that categorization eliminates partially the impact of crowding.  This may be because individuals are less salient in a subgroup in their own and others’ eyes, and therefore less arousing (Webb et al. 1986, p. 544).  And it may be because others in the group are mere social extensions of the individual self, which explains why we need less personal space from friends than strangers.

The focus of this paper, though, is on interpersonal distances, how they are essentially culturally determined, how psychology and economics interact to explain the rationing of individual space.  It concludes with a few applications of the concept of personal space in economics on the rental price of land and housing, and transportation.

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