Two things.
1. By removing zoning regulation, it's actually smaller mom and pop shops who build factories and stores. Corporations can, but actually smaller businesses can move quicker and are thus able to buy the land in upcoming areas faster (likely because the owners live there). On the other hand, with zoning, large corporations are incentivized to own commercial space. Mom and pops don't want to, because if they purchase land for a factory, they don't know if the city will actually allow that or not, and can't afford the wait / lobbying. Only large companies can. So contrary to your contrived example of no zoning leading to large factories interspersed with housing, no zoning leads to lovely homes interspersed with small artisanal factories. I'll tell you... it's extremely pleasant to walk to the artisanal chocolate factory for a mid-day treat. I pity those that cannot because they're worried Nestle's going to plop a mega-factory in their neighborhood.
2. Removing zoning regulations will encourage rich local residents to build nice housing. This will be expensive housing. No one builds low-income housing because it's stupid. Why spend a bunch of money to rent for under-market rents. But, by expanding the luxury supply, you create under-market rents for old luxury supply that hasn't been updated. That's great.
How about a strip club? how about a battery recycling company? how about a metal recycling plant? How about a bar that is open to 4AM and has lots of live concerts?
Zoning regulations exist for a reason - removing them will do ZERO to generate more low-income housing - if there was money to be made in building low-income housing, there would be plenty of low-income housing already.
Strip clubs should be wholesale illegal, but I digress. I suppose there is a Thai massage parler of dubious characcter in my neighborhood (recently started), but it'll soon be kicked out I imagine due to public pressure. It's not like no zoning means there's no neighborhood input.
Live concerts... ? Well that is against noise regulations and so while a bar can happily exist (in fact the best tiki bar in my state is located a few blocks away... lovely date night), it has to take effort to be quiet. This is good. Bars and pubs are integral to community cohesion.
There are two bars near me that throw concerts, but these are usually during the day and the neighbors are invited, and they give us free food and beer sometimes, so that's nice.
I honestly cannot understand the complaint.
I'm not advocating the removal of zoning for low-income housing. Removing zoning would build more lovely luxury housing, which is what we need more of. Low-income housing is just old luxury housing. All housing is luxury when it's built. No one build old housing. Why would you intentionally build something shitty?
Zoning regulation exist for a reason but have gone way way too far in the favor of NIMBYs who like living in food/fun/transportation deserts.
It's also a total non-concern. Reasonable regulation can get around this.
Here's a law that we can add today before we get rid of zoning.
1. Any business that knowingly engages in activity that leaks toxic materials, noise at night, vibrations, or other nuisances onto adjoining properties preventing neighborhing pre-existing property owners from enjoying their property, owes 200% punitive damages of any revenue derived from such activity or, if no revenue is derived, $1 million.
Easy... now no company will possibly build in an area with existing housing because they can face hefty damages. For example, a metal recycling company which deals with potentially hazardous waste can have its revenue turned into a loss if it builds near homes. On the other hand, since the regulation only applies to nuisances towards existing homeowners, no one will develop housing near such a metal recycling facility, because they know they will face nuisances and there's nothing they can do.
In fact, this is how it was done for many centuries.
As far as stores, I would welcome more convenient shopping options near to my residence.
Not all factories require a lot of space, and not all residential plots are expensive.
We have a chocolate factory, a noodle factory, and a commercial bakery nearby. These are our neighbors. They know the neighborhood kids. everyone gets yummy treats. Why would I possibly care?
Zoning is taking land that's not developed and slicing it up deciding where things should go. That is terrible. It's centralized planning. It is against every principle of freedom of families to choose where to live and to engage in commerce. It is the worst kind of socialism.
1. A strip joint would have economic incentives for an ideal location much like residential housing. It would likely benefit from a more economically active corridor rather than where a bunch of families raise kids. I've noticed this with adult shops when I lived in different suburbs of Vancouver.
2. Municipalities often have bylaws for when/how they can serve alcohol (eg: "last call") as well as noise levels. It strikes me that there are better regulations for ensuring these sorts of things rather than entirely stamping out small businesses to be near homes.
Like, I can understand not wanting to live next to a dive bar full of students on a Tuesday evening, but I think there's still a lot of room with liberalizing zoning to make more comfortable living spaces in North America. Japan's attitude to things makes a lot more sense to me [1], especially having lived there in a suburb nextdoor to a school.
[1] http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html
I'm not advocating for no regulation just no zoning regulation. zoning regulation is saying 'here is some undeveloped land, instead of letting it develop organically with regulations, we're going to chop the land into pieces and assign what can and cannot be done with it.'
So, for example, take sex offenders. As it is they can't live within X feet of a school. If they live somewhere and a school is being built that puts them in violation of this rule, the sex offender has to move.
The same should be true of strip clubs / adult venues. They can exist, but they cannot exist within X feet of an existing home. Boom. Strip clubs won't be built in residential areas, homes won't be built near strip clubs (except for maybe homes for horny adults?), and also no zoning was involved.
Other than that... Yeah I would like if the taco shop down the street sold ramen and the chocolate shop sold turkish delight too, but alas, I mean... what're you going to do?
You'll get a weed dispensary that is open all day and night.
You'll get a liquor store that has robberies every 3rd night.
So as to which countries... our country. Most countries had no zoning until recently.
Most housing starts in the nation over the last 10 years, leader of "housing first" homeless solutions, amazingly low housing compared to the national average ...
Market urbanism works. Reducing excessive zoning works. Pushing back on NIMBYism works.