A small model of equilibrium mechanisms in a city

André de Palma (), Stef Proost and Saskia van Der Loo
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Saskia van Der Loo: KU Leuven - Catholic University of Leuven = Katholieke Universiteit Leuven

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Abstract: We use a simple economy with two interconnected geographical zones. Individuals can live and work in one of the two zones or can commute between them. This model is used to explore the dynamics of housing and work decisions after a permanent shock in labour demand occurred in one of the two zones. We illustrate the role of the different levels of expectation of developers and government transport agencies for the equilibrium on the housing and the labour markets. The model is used to identify better Cost-Benefit rules for transport invest-ments and the role of coordination between housing and transport decisions.

Keywords: urban economics; transport; housing; dynamic land use (search for similar items in EconPapers)
Date: 2013-07-03
New Economics Papers: this item is included in nep-tre and nep-ure
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Working Paper: A small model of equilibrium mechanisms in a city (2013)
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