Optimal urban land use and zoning

Optimal urban land use and zoning

The paper studies the optimal distribution of business and residential land in a circular city. Once the optimum is characterized, we analyze the effect of changes in commuting costs and externality parameters. We also propose policies like labor subsidies, land taxes and zoning restrictions that can implement the efficient allocation as an equilibrium, or close the gap between the optimal and equilibrium allocations. The results show that business land is more concentrated at the center of the city in the optimum and that higher commuting costs increase the difference between optimal and equilibrium allocations.

Esteban Rossi-Hansberg

Review of Economic Dynamics

January 2004

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By |2018-01-01T00:00:00-08:00January 1st, 2018|Efficiency/Growth, Land Use Regulation, Reference|