The perception that a city has reached its maximum population and nobody else should be allowed in, or nothing should be allowed to change, is limiting the potential of our cities and increasing housing inequality.

Emily Badger of The Washington Post's Wonkblog tackles the question of how we determine when a city just can't take any more people by comparing our densest cities with those around the world, and discovering we're not necessarily as dense as we think. Further, an increase in population in one area results in economic and environmental benefits.
"Put more and more workers in one place, meanwhile, and you also get buzzing hubs like New York's Garment District or Boston's biotech corridor, where people working on the same problems bump into each other and share ideas and suppliers and become more productive. Put more people in a city, and the economy grows. It's the opposite of diminishing returns. The environmental costs, per person, can actually improve. In drought-stricken California, some of the lowest water consumption per capita is in San Francisco."
Badger notes that the use of environmental laws by NIMBYs, particularly in California, has led to greater economic inequality. The cost of housing has continued to rise as residents have blocked new housing, thereby limiting the supply for newcomers and stopping the natural evolution of our cities.
FULL STORY: There is no such thing as a city that has run out of room

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City of Albany
UCLA Lewis Center for Regional Policy Studies
Mpact (formerly Rail~Volution)
Chaddick Institute at DePaul University
City of Piedmont, CA
Great Falls Development Authority, Inc.
HUDs Office of Policy Development and Research