Residential land use, transport and congestion in a computable general equilibrium model

James Lennox and Philip Adams

No 332740, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: Computable general equilibrium (CGE) models are widely used in economic analysis of many types of policies that may strongly influence urban form and mobility. However, existing CGE models either ignore relationships between urban form and mobility, incorporate relationships based on highly stylised and restrictive models, or model individual metropolitan areas in isolation from wider economies that consist of multiple metropolitan and non-metropolitan areas. This paper introduces an ad hoc but flexible approach to modelling aggregative relationships between key variables influenced by urban form. Our approach permits implementation of detailed model structures suitable for applied analysis. It is straight-forward to account for multiple modes of transport and types of land use, as well as for congestion and other externalities that are important in the urban context. We illustrate our approach by extending the Victoria University Regional Model (VURM, formerly MMRF), multi-regional model of Australia, to account for the relationship between households’ demands for residential land and for urban mobility, for choices between car, bus and train travel accounting for both pecuniary and time costs, and for positive and negative externalities affecting the costs of each mode. We present illustrative simulations that highlight the potentially large effects these latter factors may have on patterns of growth and on responses to policies.

Keywords: Land Economics/Use; Research Methods/ Statistical Methods (search for similar items in EconPapers)
Date: 2016
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