I've always been fascinated by the way businesses cluster, even retail stores. You tend to get multiple clothing shops, home improvement stores, and so forth in a relatively small area, especially when there's high population density--New York City has an entire area that's just chock full of lamp shops.
Street noise is a very real issue in large swathes of Manhattan and I think it's perfectly understandable that people prefer not to have lively nightlife scenes located directly outside their windows. So when I read Sarah Laskow's long and excellent account of liquor license battles in the East Village, I'm not-unsympathetic to the incumbent residents' concerns. But as she observes at the end, there's a real cost to this attitude:
At the meeting with Kao, the locals gave him the same reason for opposing him that they had given Warren, when he wanted to open a burger bar in the space: according to the current license, the only type of business that should be selling liquor at 200 Ave. A is a bookshop. With rent set at $10,000 in the East Village Party District, that's as unlikely as it sounds.
The broader issue, as she explains, is that cities are driven by agglomeration:
Academics have a word for what the neighborhood has become: a nightscape. Bars and restaurants were once peripheral to the main drag's primary economic drivers: supermarkets, coffeehouses, boutique shops, record stores. But in post-industrial cities, nightlife has grown into an industry in its own right. As in any industry, shop owners tend to cluster. A century ago, that meant the creation of a Garment District. Now it means the creation of a Party District.
Basically the East Village really "wants" to be full of nightlife establishments just like Qiaotou, China wants button factories. Restricting the creation of new button factories in Qiatou will help incumbent button makers (and alleviate neighborhood concerns about factory smoot) but it's hard to call a bar scene into existence that way. Similarly, making it hard to open a new bar in the East Village isn't going to create a button factory. It's going to create an underutilized space. That means somewhat more unemployment in the city, somewhat less tax revenue in the city, and thus at the margin higher tax rates and fewer social services for everyone.
Ryan Avent adds an important observation: attempting to restrict the crowds at bars may actually increase the noise problem.