The Costs of Agglomeration: House and Land Prices in French Cities

Gilles Duranton, Pierre-Philippe Combes and Laurent Gobillon

No 9240, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We develop a new methodology to estimate the elasticity of urban costs with respect to city population using French house and land price data. After handling a number of estimation concerns, we find that the elasticity of urban cost increases with city population with an estimate of about 0.04 for an urban area with 100,000 inhabitants to 0.10 for an urban area of the size of Paris. Our approach also yields a number of intermediate outputs of independent interest such as the share of housing in expenditure, the elasticity of unit house and land prices with respect to city population, and distance gradients for house and land prices.

Keywords: House prices; Agglomeration; Land prices; Land use; Urban costs (search for similar items in EconPapers)
JEL-codes: R14 R21 R31 (search for similar items in EconPapers)
Date: 2012-12
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Citations: View citations in EconPapers (56)

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Journal Article: The Costs of Agglomeration: House and Land Prices in French Cities (2019)
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