The Effect of Transportation and Housing Subsidies on Urban Sprawl

Cai Qiao (), Wang Zou () and Xiao Lingling ()
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Cai Qiao: School of Economics and Management, Beijing Jiaotong University, Beijing100044, China
Wang Zou: School of Economics and Management, Beijing Jiaotong University, Beijing100044, China
Xiao Lingling: School of Economics and Management, Beijing Jiaotong University, Beijing100044, China

Journal of Systems Science and Information, 2018, vol. 6, issue 3, 237-248

Abstract: This paper analyses theoretically the effect of transportation and housing subsidies on urban sprawl, modal choice decisions and urban spatial structure using a spatial general equilibrium model in a monocentric city with two transport modes. Our analysis shows that public transit subsidy leads to urban shrink, whilst subsidizing automobile and housing make the city sprawl. We also find the effects of the other factors on urban sprawl, such as households income and demand, rural land rent, the income tax rate, the total fixed cost of public transit and automobile and the travelling marginal cost of public transit and automobile. Furthermore, this paper also studies how to maximize the urban-area-wide spatial equilibrium utility level.

Keywords: monocentric city; subsidies; urban sprawl; spatial equilibrium (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:bpj:jossai:v:6:y:2018:i:3:p:237-248:n:3

DOI: 10.21078/JSSI-2018-237-12

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