Structural Change, Land Use and Urban Expansion

Nicolas Coeurdacier, Florian Oswald and Marc Teignier

No 17014, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: How do cities grow in the process of structural transformation? To answer this question, we develop a multi-sector spatial equilibrium model with endogenous land use: land is used either for agriculture or housing. Urban land, densely populated due to commuting frictions, expands out of agricultural land. With low productivity and high subsistence needs, farmland is expensive, households cannot afford large homes and cities are very dense. Increasing productivity reallocates factors away from agriculture, freeing up land for urban expansion and limiting the increase in land values despite higher income and urban population. With the area of cities growing faster than urban population, urban density can persistently decline, as in the data over a long period. Quantitative predictions of the joint evolution of density and land values across time and space are confronted with historical data assembled for France over 180 years.

Keywords: Structural change; Land use; Productivity growth; Urban density (search for similar items in EconPapers)
JEL-codes: O11 O41 R14 (search for similar items in EconPapers)
Date: 2022-02
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Related works:
Working Paper: Structural Change, Land Use and Urban Expansion (2022)
Working Paper: Structural Change, Land Use and Urban Expansion (2022)
Working Paper: Structural Change, Land Use and Urban Expansion (2021)
Working Paper: Structural Change, Land Use and Urban Expansion (2021)
Working Paper: Structural Change, Land Use and Urban Expansion (2021)
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