Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/hig/wpaper/162-ec-2017.html
   My bibliography  Save this paper

Amenities and the Social Structure of Cities

Author

Listed:
  • Carl Gaigne

    (Institut National de la Recherche Agronomique (INRA) - CESAER)

  • Hans R.A. Koster

    (VU University Amsterdam - Faculty of Economics and Business Administration)

  • Fabien Moizeau

    (Universite Paris I Pantheon-Sorbonne - Equipe Universitaire de Recherche en Economie)

  • Jacques-Francois Thisse

    (National Research University Higher School of Economics)

Abstract
We develop a new model of a "featureful" city in which locations are differentiated by two attributes, that is, the distance to employment centers and the accessibility to given amenities, and we show how heterogeneous households in income are sorted out across the urban space. Under Stone-Geary preferences, the spatial income distribution is governed by a location-quality index which reffects the interaction between the amenity and commuting cost functions. The residential equilibrium typically involves the spatial separation of households sharing similar incomes. Using data on Dutch cities, we show that there is a causal relationship between the amenity level and consumer income, suggesting that richer households sort themselves into high amenity locations. We do not find strong evidence that employment accessibility leads to income segregation, suggesting that the standard monocentric city model without amenities is a poor predictor of the social structure of cities.

Suggested Citation

  • Carl Gaigne & Hans R.A. Koster & Fabien Moizeau & Jacques-Francois Thisse, 2017. "Amenities and the Social Structure of Cities," HSE Working papers WP BRP 162/EC/2017, National Research University Higher School of Economics.
    • Handle: RePEc:hig:wpaper:162/ec/2017
    as

    Download full text from publisher

    File URL: https://wp.hse.ru/data/2017/04/27/1171736898/162EC2017.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. de Bartolome, Charles A.M. & Ross, Stephen L., 2007. "Community income distributions in a metropolitan area," Journal of Urban Economics, Elsevier, vol. 61(3), pages 496-518, May.
    2. Edward L. Glaeser, Jed Kolko, and Albert Saiz, 2001. "Consumer city," Journal of Economic Geography, Oxford University Press, vol. 1(1), pages 27-50, January.
    3. Leggett, Christopher G. & Bockstael, Nancy E., 2000. "Evidence of the Effects of Water Quality on Residential Land Prices," Journal of Environmental Economics and Management, Elsevier, vol. 39(2), pages 121-144, March.
    4. Duranton, Gilles & Puga, Diego, 2015. "Urban Land Use," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 467-560, Elsevier.
    5. Esteban Rossi-Hansberg & Pierre-Daniel Sarte & Raymond Owens, 2010. "Housing Externalities," Journal of Political Economy, University of Chicago Press, vol. 118(3), pages 485-535, June.
    6. Hans R. A. Koster & Jos N. van Ommeren & Piet Rietveld, 2016. "Historic amenities, income and sorting of households," Journal of Economic Geography, Oxford University Press, vol. 16(1), pages 203-236.
    7. Pablo Fajgelbaum & Gene M. Grossman & Elhanan Helpman, 2011. "Income Distribution, Product Quality, and International Trade," Journal of Political Economy, University of Chicago Press, vol. 119(4), pages 721-765.
    8. Victor Couture & Jessie Handbury, 2017. "Urban Revival in America, 2000 to 2010," NBER Working Papers 24084, National Bureau of Economic Research, Inc.
    9. Dennis Epple & Holger Sieg, 1999. "Estimating Equilibrium Models of Local Jurisdictions," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 645-681, August.
    10. Sattinger, Michael, 1993. "Assignment Models of the Distribution of Earnings," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 831-880, June.
    11. Tim Landvoigt & Monika Piazzesi & Martin Schneider, 2015. "The Housing Market(s) of San Diego," American Economic Review, American Economic Association, vol. 105(4), pages 1371-1407, April.
    12. Rebecca Diamond, 2016. "The Determinants and Welfare Implications of US Workers' Diverging Location Choices by Skill: 1980-2000," American Economic Review, American Economic Association, vol. 106(3), pages 479-524, March.
    13. Fujita,Masahisa, 1991. "Urban Economic Theory," Cambridge Books, Cambridge University Press, number 9780521396455, September.
    14. Jan Eeckhout & Roberto Pinheiro & Kurt Schmidheiny, 2014. "Spatial Sorting," Journal of Political Economy, University of Chicago Press, vol. 122(3), pages 554-620.
    15. Hans R.A. Koster & Jan Rouwendal, 2017. "Historic Amenities and Housing Externalities: Evidence from the Netherlands," Economic Journal, Royal Economic Society, vol. 127(605), pages 396-420, October.
    16. Kristian Behrens & Gilles Duranton & Frédéric Robert-Nicoud, 2014. "Productive Cities: Sorting, Selection, and Agglomeration," Journal of Political Economy, University of Chicago Press, vol. 122(3), pages 507-553.
    17. Kamecke Ulrich, 1993. "Mean City--A Consistent Approximation of Bid Rent Equilibria," Journal of Urban Economics, Elsevier, vol. 33(1), pages 48-67, January.
    18. Ritzen, Jozef M. M. & van Dommelen, Jan & De Vijlder, Frans J., 1997. "School finance and school choice in the Netherlands," Economics of Education Review, Elsevier, vol. 16(3), pages 329-335, June.
    19. Brueckner, Jan K. & Thisse, Jacques-Francois & Zenou, Yves, 1999. "Why is central Paris rich and downtown Detroit poor?: An amenity-based theory," European Economic Review, Elsevier, vol. 43(1), pages 91-107, January.
    20. Geels, Frank W., 2006. "The hygienic transition from cesspools to sewer systems (1840-1930): The dynamics of regime transformation," Research Policy, Elsevier, vol. 35(7), pages 1069-1082, September.
    21. Jan K. Brueckner & Stuart S. Rosenthal, 2009. "Gentrification and Neighborhood Housing Cycles: Will America's Future Downtowns Be Rich?," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 725-743, November.
    22. van Ommeren, Jos N. & Gutiérrez-i-Puigarnau, Eva, 2011. "Are workers with a long commute less productive? An empirical analysis of absenteeism," Regional Science and Urban Economics, Elsevier, vol. 41(1), pages 1-8, January.
    23. Määttänen, Niku & Terviö, Marko, 2014. "Income distribution and housing prices: An assignment model approach," Journal of Economic Theory, Elsevier, vol. 151(C), pages 381-410.
    24. Koster, Paul R. & Koster, Hans R.A., 2015. "Commuters’ preferences for fast and reliable travel: A semi-parametric estimation approach," Transportation Research Part B: Methodological, Elsevier, vol. 81(P1), pages 289-301.
    25. J. Vernon Henderson & Jacques-Francois Thisse, 2001. "On Strategic Community Development," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 546-569, June.
    26. Miyake, Mitsunobu, 2003. "Precise computation of a competitive equilibrium of the discrete land market model," Regional Science and Urban Economics, Elsevier, vol. 33(6), pages 721-743, October.
    27. David Albouy, 2016. "What Are Cities Worth? Land Rents, Local Productivity, and the Total Value of Amenities," The Review of Economics and Statistics, MIT Press, vol. 98(3), pages 477-487, July.
    28. Pierre-Andr'e Chiappori & Robert McCann & Brendan Pass, 2016. "Multidimensional matching," Papers 1604.05771, arXiv.org.
    29. Morris A. Davis & Francois Ortalo-Magne, 2011. "Household Expenditures, Wages, Rents," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 14(2), pages 248-261, April.
    30. Gilles Duranton & J. V. Henderson & William C. Strange (ed.), 2015. "Handbook of Regional and Urban Economics," Handbook of Regional and Urban Economics, Elsevier, edition 1, volume 5, number 5.
    31. Epple, Dennis & Nechyba, Thomas, 2004. "Fiscal decentralization," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 55, pages 2423-2480, Elsevier.
    32. Glaeser, Edward L. & Kahn, Matthew E. & Rappaport, Jordan, 2008. "Why do the poor live in cities The role of public transportation," Journal of Urban Economics, Elsevier, vol. 63(1), pages 1-24, January.
    33. Wheaton, William C, 1977. "Income and Urban Residence: An Analysis of Consumer Demand for Location," American Economic Review, American Economic Association, vol. 67(4), pages 620-631, September.
    34. Patrick Legros & Andrew F. Newman, 2002. "Monotone Matching in Perfect and Imperfect Worlds," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(4), pages 925-942.
    35. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    36. Fujita, Masahisa & Ogawa, Hideaki, 1982. "Multiple equilibria and structural transition of non-monocentric urban configurations," Regional Science and Urban Economics, Elsevier, vol. 12(2), pages 161-196, May.
    37. Sanghoon Lee & Jeffrey Lin, 2018. "Natural Amenities, Neighbourhood Dynamics, and Persistence in the Spatial Distribution of Income," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 85(1), pages 663-694.
    38. Hartwick, John & Schweizer, Urs & Varaiya, Pravin, 1976. "Comparative statics of a residential economy with several classes," Journal of Economic Theory, Elsevier, vol. 13(3), pages 396-413, December.
    39. Paul Koster & Hans Koster, 2013. "Commuters' Preferences for Fast and Reliable Travel," Tinbergen Institute Discussion Papers 13-075/VIII, Tinbergen Institute, revised 30 Apr 2015.
    40. Rosa Sanchis-Guarner, 2012. "Driving Up Wages: The Effects of Road Construction in Great Britain," SERC Discussion Papers 0120, Centre for Economic Performance, LSE.
    41. Nathaniel Baum-Snow, 2007. "Did Highways Cause Suburbanization?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(2), pages 775-805.
    42. Raj Chetty & Nathaniel Hendren & Lawrence F. Katz, 2016. "The Effects of Exposure to Better Neighborhoods on Children: New Evidence from the Moving to Opportunity Experiment," American Economic Review, American Economic Association, vol. 106(4), pages 855-902, April.
    43. Pablo D. Fajgelbaum, 2011. "Income Distribution, Product Quality and International Trade," 2011 Meeting Papers 415, Society for Economic Dynamics.
    44. Dennis Epple & Brett Gordon & Holger Sieg, 2010. "Drs. Muth And Mills Meet Dr. Tiebout: Integrating Location‐Specific Amenities Into Multi‐Community Equilibrium Models," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 381-400, February.
    45. Schmidheiny, Kurt, 2006. "Income segregation from local income taxation when households differ in both preferences and incomes," Regional Science and Urban Economics, Elsevier, vol. 36(2), pages 270-299, March.
    46. Jessie Bakens & Raymond J.G.M. Florax & Peter Mulder, 2018. "Ethnic drift and white flight: A gravity model of neighborhood formation," Journal of Regional Science, Wiley Blackwell, vol. 58(5), pages 921-948, November.
    47. Durlauf, Steven N., 2004. "Neighborhood effects," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 50, pages 2173-2242, Elsevier.
    48. Robert E. Lucas & Esteban Rossi-Hansberg, 2002. "On the Internal Structure of Cities," Econometrica, Econometric Society, vol. 70(4), pages 1445-1476, July.
    49. Matthew A. Turner & Andrew Haughwout & Wilbert van der Klaauw, 2014. "Land Use Regulation and Welfare," Econometrica, Econometric Society, vol. 82(4), pages 1341-1403, July.
    50. Beckmann, Martin J., 1969. "On the distribution of urban rent and residential density," Journal of Economic Theory, Elsevier, vol. 1(1), pages 60-67, June.
    51. J. V. Henderson & J. F. Thisse (ed.), 2004. "Handbook of Regional and Urban Economics," Handbook of Regional and Urban Economics, Elsevier, edition 1, volume 4, number 4.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Franco, Sofia F. & Macdonald, Jacob L., 2018. "The effects of cultural heritage on residential property values: Evidence from Lisbon, Portugal," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 35-56.
    2. Victor Couture & Cecile Gaubert & Jessie Handbury & Erik Hurst, 2019. "Income Growth and the Distributional Effects of Urban Spatial Sorting," NBER Working Papers 26142, National Bureau of Economic Research, Inc.
    3. Loumeau, Gabriel, 2023. "Locating Public Facilities: Theory and Micro Evidence from Paris," Journal of Urban Economics, Elsevier, vol. 135(C).
    4. Malykhin, Nikita & Ushchev, Philip, 2018. "How market interactions shape the city structure," Regional Science and Urban Economics, Elsevier, vol. 71(C), pages 122-136.
    5. Leonardo J. Basso & Matías Navarro & Hugo Silva, 2020. "Public Transport and Urban Structure," Documentos de Trabajo 549, Instituto de Economia. Pontificia Universidad Católica de Chile..
    6. Moshref-Javadi, Mohammad & Lee, Seokcheon & Winkenbach, Matthias, 2020. "Design and evaluation of a multi-trip delivery model with truck and drones," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 136(C).
    7. Viladecans-Marsal, Elisabet & Garcia-Lopez, Miquel-Angel & Pasidis, Ilias, 2018. "Amphitheaters, cathedrals and operas: The role of historic amenities on suburbanization," CEPR Discussion Papers 13129, C.E.P.R. Discussion Papers.
    8. Hans R. A. Koster & Jos van Ommeren, 2019. "Place-Based Policies and the Housing Market," The Review of Economics and Statistics, MIT Press, vol. 101(3), pages 400-414, July.
    9. Tivadar, Mihai & Jayet, Hubert, 2019. "Endogenous generation of amenities and the dynamics of city structure," Regional Science and Urban Economics, Elsevier, vol. 74(C), pages 49-56.
    10. Basso, Leonardo J. & Navarro, Matias & Silva, Hugo E., 2021. "Public transport and urban structure," Economics of Transportation, Elsevier, vol. 28(C).
    11. Yang, Xiaozhong & Zhang, Cheng, 2023. "Travelling for public goods, neighborhood effect and spatial stratification," International Review of Economics & Finance, Elsevier, vol. 84(C), pages 128-139.
    12. Hast, Aira & Syri, Sanna & Lekavičius, Vidas & Galinis, Arvydas, 2018. "District heating in cities as a part of low-carbon energy system," Energy, Elsevier, vol. 152(C), pages 627-639.
    13. Yang, Xiaozhong & Zhang, Cheng, 2022. "Spatial investments in the real estate industry: Based on the population flow within the city," Journal of Business Research, Elsevier, vol. 140(C), pages 593-603.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gaigné, Carl & Koster, Hans R.A. & Moizeau, Fabien & Thisse, Jacques-François, 2022. "Who lives where in the city? Amenities, commuting and income sorting," Journal of Urban Economics, Elsevier, vol. 128(C).
    2. Stef Proost & Jacques-François Thisse, 2019. "What Can Be Learned from Spatial Economics?," Journal of Economic Literature, American Economic Association, vol. 57(3), pages 575-643, September.
    3. Duranton, Gilles & Puga, Diego, 2015. "Urban Land Use," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 467-560, Elsevier.
    4. Carl Gaigne & Hans R.A. Koster & Fabien Moizeau & Jacques-François Thisse, 2020. "Income Sorting Across Space: The Role of Amenities and Commuting Costs," Working Papers SMART 20-06, INRAE UMR SMART.
    5. Behrens, Kristian & Robert-Nicoud, Frédéric, 2015. "Agglomeration Theory with Heterogeneous Agents," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 171-245, Elsevier.
    6. Cuberes, David & Roberts, Jennifer & Sechel, Cristina, 2019. "Household location in English cities," Regional Science and Urban Economics, Elsevier, vol. 75(C), pages 120-135.
    7. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.
    8. Pierre-Philippe Combes & Gilles Duranton & Laurent Gobillon, 2012. "The Cost of Agglomeration: Land Prices in Cities," Working Papers hal-03461075, HAL.
    9. Kahn, Matthew E. & Walsh, Randall, 2015. "Cities and the Environment," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 405-465, Elsevier.
    10. Ulrich B. Morawetz & H. Allen Klaiber, 2022. "Does housing policy impact income sorting near urban amenities? Evidence from Vienna, Austria," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 69(2), pages 411-454, October.
    11. Rosenthal, Stuart S. & Ross, Stephen L., 2015. "Change and Persistence in the Economic Status of Neighborhoods and Cities," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 1047-1120, Elsevier.
    12. Davis, Donald R. & Dingel, Jonathan I., 2020. "The comparative advantage of cities," Journal of International Economics, Elsevier, vol. 123(C).
    13. Camilo Andrés Acosta Mejía, 2021. "The Incidence of Land Use Regulations," Documentos de Trabajo de Valor Público 19223, Universidad EAFIT.
    14. Viladecans-Marsal, Elisabet & Garcia-Lopez, Miquel-Angel & Pasidis, Ilias, 2018. "Amphitheaters, cathedrals and operas: The role of historic amenities on suburbanization," CEPR Discussion Papers 13129, C.E.P.R. Discussion Papers.
    15. Carl Gaigné & Jacques-François Thisse, 2013. "New Economic Geography and the City," Working Papers SMART 13-02, INRAE UMR SMART.
    16. Gabriel M. Ahlfeldt & Stephen J. Redding & Daniel M. Sturm & Nikolaus Wolf, 2015. "The Economics of Density: Evidence From the Berlin Wall," Econometrica, Econometric Society, vol. 83, pages 2127-2189, November.
    17. Thisse, Jacques-François & Proost, Stef, 2015. "Skilled Cities, Regional Disparities, and Efficient Transport: The state of the art and a research agenda," CEPR Discussion Papers 10790, C.E.P.R. Discussion Papers.
    18. repec:hal:spmain:info:hdl:2441/6bmhhi42888fj8hn1okddaqsab is not listed on IDEAS
    19. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    20. Victor Couture & Jessie Handbury, 2017. "Urban Revival in America, 2000 to 2010," NBER Working Papers 24084, National Bureau of Economic Research, Inc.
    21. Behrens, Kristian & Robert-Nicoud, Frédéric, 2008. "Survival of the fittest in cities: agglomeration, selection, and polarisation," LSE Research Online Documents on Economics 28506, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    cities; social stratication; income; amenities; commuting;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hig:wpaper:162/ec/2017. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Shamil Abdulaev or Shamil Abdulaev (email available below). General contact details of provider: https://edirc.repec.org/data/hsecoru.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.