Who's in Charge in the Inner City? The Conflict Between Efficiency and Equity in the Design of a Metropolitan Area

Charles de Bartolome () and Stephen Ross

No 2002-03, Working papers from University of Connecticut, Department of Economics

Abstract: A circular metropolitan area consists of an inner city and a suburb. Households sort over the two jurisdictions based on public service levels and their costs of commuting to the metropolitan center. Using numerical simulations, we show (1) there typically exist two equilibria: one in which the poor form the majority in the inner city and the other in which the rich form the majority in the inner city; (2) there is an efficiency vs. equity trade-off as to which equilibrium is preferred; and (3) if the inner city contains only poor households, equity favors expanding the inner city to include rich households.

Keywords: urban; equilibria; welfare (search for similar items in EconPapers)
JEL-codes: H73 R12 R14 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2002-08
New Economics Papers: this item is included in nep-cdm, nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Forthcoming in the Journal of Urban Economics

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Persistent link: https://EconPapers.repec.org/RePEc:uct:uconnp:2002-03

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