TAILIEUCHUNG - A Companion to Urban Economics - Arnott and McMillen - Part 2

P A R T I I Urban Land Use Land rents, population densities, building heights, and lot sizes vary dramatically within urban areas. Central business areas may have 60-story office buildings, while small, two- or three-story buildings lie unused and boarded up just a mile or two away. | A Companion to Urban Economics Edited by Richard J. Arnott Daniel P. McMillen Copyright 2006 by Blackwell Publishing Ltd I PART n Urban Land Use A Companion to Urban Economics Edited by Richard J. Arnott Daniel P. McMillen Copyright 2006 by Blackwell Publishing Ltd Urban Land Use Land rents population densities building heights and lot sizes vary dramatically within urban areas. Central business areas may have 60-story office buildings while small two- or three-story buildings lie unused and boarded up just a mile or two away. Wealthy people often live near the central businesses areas even while nearby neighborhoods suffer from extreme levels of poverty crime and unemployment. Many offices and other businesses have moved from the central city to suburbs that once were nearly entirely residential. Urban areas continue to expand by acquiring farmland at a rapid rate. The opening essay in this part The Spatial Pattern of Land Use in the United States by Elena Irwin and Nancy Bockstael documents changes in land-use patterns in the United States over the past several decades. Although 80 percent of the US population lives in urban areas well under 10 percent of the land area is urbanized. One of the hallmarks of urban economics is the development of a full general equilibrium model that helps to explain and predict these features of the urban landscape. The monocentric city model began as a description of a city that literally has only a single center a central business district that is the site of all business. In the model land rents population densities and building heights all decline with distance from the city center because households will pay a premium to avoid costly commutes to their jobs in the central business district. The simplest version of the model produces remarkably accurate descriptions of older cities that are in fact dominated by a single center of employment. When distance to the central business district is interpreted as a more general measure

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