The division of labor allows individuals to focus their time on a narrower band of activities and increase productivity through specialization, but this comes at a cost. When individuals divide labor, they divide value and split the “pie” they help create. In this paper, I formally model this tradeoff and examine how it is affected by opportunity-cost considerations due to market characteristics. I then test the empirical predictions of the model in the residential real estate brokerage industry in Southeast Michigan. Consistent with the predictions, I find that the division of labor is more likely for properties in the midrange of the price distribution and in larger markets, but less likely at the tails and in markets where property prices exhibit substantial heterogeneity.
{"title":"Is the Division of Labor Limited by the Extent of the Market? Opportunity Cost Theory with Evidence from the Real Estate Brokerage Industry","authors":"Gianluigi Giustiziero","doi":"10.1002/smj.3249","DOIUrl":"https://doi.org/10.1002/smj.3249","url":null,"abstract":"The division of labor allows individuals to focus their time on a narrower band of activities and increase productivity through specialization, but this comes at a cost. When individuals divide labor, they divide value and split the “pie” they help create. In this paper, I formally model this tradeoff and examine how it is affected by opportunity-cost considerations due to market characteristics. I then test the empirical predictions of the model in the residential real estate brokerage industry in Southeast Michigan. Consistent with the predictions, I find that the division of labor is more likely for properties in the midrange of the price distribution and in larger markets, but less likely at the tails and in markets where property prices exhibit substantial heterogeneity.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79674708","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Rental brokers as the matchmakers between tenants and landlords contribute 80% of the rental listings in certain markets, but how they smooth the search friction and transmit policy impacts is not well understood. This paper is the first to use a listing-agent matched data set from an online platform to show the heterogeneous impact of the listing capacity of a broker, i.e. the agent size, on the rental market outcomes. I document that brokers with greater listing capacity are related to lower rents and shorter listing duration. The dispersion cannot be fully explained by the amenity difference of rentals and points to a sizable agent impact that a broker with greater capacity lists a rental at a lower rent. I develop a search model that features a search-and-matching process in which the capacity constraints of brokers interact with the tenant coordination friction. The capacity constraints differentiate brokers’ ability to coordinate tenant search. The smaller rent premium for listings by larger brokers reflects the capacity benefit that larger brokers coordinate tenant search better by reducing the likelihood of facing a binding capacity constraint. An endogenous agent distribution of the listing capacity, which summarizes how frictional the rental market is, arises in the model. I evaluate the counterfactual effects of two rental market policies. First, I show that expanding the brokerage sector will not benefit tenants in the search process. As the mean agent size decreases, the rental market becomes more frictional. Second, I evaluate the impact of shifting the commission liability from tenants to landlords, which is central to the New York rental market reform. As the equilibrium rent increase cannot fully compensate the commission cost on landlords, the policy decreases rental supply and makes searching tenants worse off. I characterize the optimal allocation of the broker’s fee and show that brokers with greater listing capacity should list more rentals with the fee paid by landlords.
{"title":"Housing Search and Rental Market Intermediation","authors":"Desen Lin","doi":"10.2139/ssrn.3714128","DOIUrl":"https://doi.org/10.2139/ssrn.3714128","url":null,"abstract":"Rental brokers as the matchmakers between tenants and landlords contribute 80% of the rental listings in certain markets, but how they smooth the search friction and transmit policy impacts is not well understood. This paper is the first to use a listing-agent matched data set from an online platform to show the heterogeneous impact of the listing capacity of a broker, i.e. the agent size, on the rental market outcomes. I document that brokers with greater listing capacity are related to lower rents and shorter listing duration. The dispersion cannot be fully explained by the amenity difference of rentals and points to a sizable agent impact that a broker with greater capacity lists a rental at a lower rent. I develop a search model that features a search-and-matching process in which the capacity constraints of brokers interact with the tenant coordination friction. The capacity constraints differentiate brokers’ ability to coordinate tenant search. The smaller rent premium for listings by larger brokers reflects the capacity benefit that larger brokers coordinate tenant search better by reducing the likelihood of facing a binding capacity constraint. An endogenous agent distribution of the listing capacity, which summarizes how frictional the rental market is, arises in the model. I evaluate the counterfactual effects of two rental market policies. First, I show that expanding the brokerage sector will not benefit tenants in the search process. As the mean agent size decreases, the rental market becomes more frictional. Second, I evaluate the impact of shifting the commission liability from tenants to landlords, which is central to the New York rental market reform. As the equilibrium rent increase cannot fully compensate the commission cost on landlords, the policy decreases rental supply and makes searching tenants worse off. I characterize the optimal allocation of the broker’s fee and show that brokers with greater listing capacity should list more rentals with the fee paid by landlords.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"9 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80147238","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper studies the effects of local income taxation on tax base and individual mobility since the early 2000s in Italy. Over this period of tax decentralization, regions and municipalities have been granted greater power to set different tax rates across income brackets. We combine novel fine-grained data on the universe of tax residence’s transfers with 89,860 local income tax changes and income bracket-by-municipality-level panel data on the tax base. We propose different empirical strategies, resting on tax rate variations both over time and across individuals within locations. We find that taxation significantly affects the location of the tax base. The mobility response mostly reflects tax residence relocation and involves a separation between residence and workplace. Responses strongly vary by gender, education, civil status and occupations. Yet, our estimates imply that efficiency losses due to tax-induced mobility are relatively small, thus making local redistribution feasible at least in the medium-run.
{"title":"Tax-Induced Transfer of Residence: Evidence From Tax Decentralization in Italy","authors":"Enrico Rubolino","doi":"10.2139/ssrn.3710932","DOIUrl":"https://doi.org/10.2139/ssrn.3710932","url":null,"abstract":"This paper studies the effects of local income taxation on tax base and individual mobility since the early 2000s in Italy. Over this period of tax decentralization, regions and municipalities have been granted greater power to set different tax rates across income brackets. We combine novel fine-grained data on the universe of tax residence’s transfers with 89,860 local income tax changes and income bracket-by-municipality-level panel data on the tax base. We propose different empirical strategies, resting on tax rate variations both over time and across individuals within locations. We find that taxation significantly affects the location of the tax base. The mobility response mostly reflects tax residence relocation and involves a separation between residence and workplace. Responses strongly vary by gender, education, civil status and occupations. Yet, our estimates imply that efficiency losses due to tax-induced mobility are relatively small, thus making local redistribution feasible at least in the medium-run.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"6 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78079714","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Lax credit conditions and speculative behaviors can combine to bring about leveraged real estate bubbles that pose a threat to financial stability. This risk can be pushed away by the adoption of proper macroprudential polices. Borrower-based macroprudential tools, namely loan-to-value and debt-to-income ratios, are designed to dampen the procyclicality of credit and to enhance the resilience of financial institutions. By putting a ceiling to borrowing the financial sustainability of mortgages can be improved for borrowers and lenders. This paper studies the interaction of the two instruments employing an agent-based model calibrated on the Irish mortgage market. I construct several policy scenarios grounded on residential loan data to run counterfactual experiments and explore alternative settings of macroprudential policy. This approach provides granular artificial data about the distribution of loan-to-value and debt-to-income ratios at origination, credit, and house prices.
{"title":"The Interaction of Borrower-Targeted Macroprudential Tools in the Irish Mortgage Market: A Baseline Multi-Agent Approach","authors":"A. Gurgone","doi":"10.2139/ssrn.3708904","DOIUrl":"https://doi.org/10.2139/ssrn.3708904","url":null,"abstract":"Lax credit conditions and speculative behaviors can combine to bring about leveraged real estate bubbles that pose a threat to financial stability. This risk can be pushed away by the adoption of proper macroprudential polices. Borrower-based macroprudential tools, namely loan-to-value and debt-to-income ratios, are designed to dampen the procyclicality of credit and to enhance the resilience of financial institutions. By putting a ceiling to borrowing the financial sustainability of mortgages can be improved for borrowers and lenders. This paper studies the interaction of the two instruments employing an agent-based model calibrated on the Irish mortgage market. I construct several policy scenarios grounded on residential loan data to run counterfactual experiments and explore alternative settings of macroprudential policy. This approach provides granular artificial data about the distribution of loan-to-value and debt-to-income ratios at origination, credit, and house prices.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"6 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79713315","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Juncheng Yang, H. Rong, Yuhao Kang, Fan Zhang, Andrea M. Chegut
Urban street-level greenery is empirically documented to improve mental and physical health, increase productivity, increase urban environmental equality and reduce carbon footprints. In addition, these benefits raise residents' welfare, which has been correlated with increases in residential house prices. We measure street-level greenness in New York City through a novel Green View Index (GVI) using Google Street View images and assess the impacts of greenness on commercial real estate prices. Using a sample of office transactions, we spatially correlate Google Street View Images for New York City over the 2010 to 2017 period. We find a 8.9% to 10.5% statistically, economically and positive transaction premium and a 5.6% to 7.8% rent premium for offices with low to high street-level greenness relative to those building transactions spatially correlated with very low greenness. Estimations are robust to proximity to parks, subway stations, sidewalk widths, household income levels and investments by Building Improvement Districts, as well as other vital and standard office valuation features. By documenting the role of greenery in commercial building valuations, our results give a more complete understanding of the value of greenness in urban environments, and the economic role that urban landscape architecture, planning and development has upon cities.
{"title":"The Financial Impact of Street-Level Greenery on New York Commercial Buildings","authors":"Juncheng Yang, H. Rong, Yuhao Kang, Fan Zhang, Andrea M. Chegut","doi":"10.2139/ssrn.3714858","DOIUrl":"https://doi.org/10.2139/ssrn.3714858","url":null,"abstract":"Urban street-level greenery is empirically documented to improve mental and physical health, increase productivity, increase urban environmental equality and reduce carbon footprints. In addition, these benefits raise residents' welfare, which has been correlated with increases in residential house prices. We measure street-level greenness in New York City through a novel Green View Index (GVI) using Google Street View images and assess the impacts of greenness on commercial real estate prices. Using a sample of office transactions, we spatially correlate Google Street View Images for New York City over the 2010 to 2017 period. We find a 8.9% to 10.5% statistically, economically and positive transaction premium and a 5.6% to 7.8% rent premium for offices with low to high street-level greenness relative to those building transactions spatially correlated with very low greenness. Estimations are robust to proximity to parks, subway stations, sidewalk widths, household income levels and investments by Building Improvement Districts, as well as other vital and standard office valuation features. By documenting the role of greenery in commercial building valuations, our results give a more complete understanding of the value of greenness in urban environments, and the economic role that urban landscape architecture, planning and development has upon cities.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"82 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77300562","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In this paper, we explore dynamic changes in the capitalization of sea level rise (SLR) risk in housing and mortgage markets. Our results suggest a disconnect in coastal Florida real estate: From 2013-2018, home sales volumes in the most-SLR-exposed communities declined 16-20% relative to less-SLR-exposed areas, even as their sale prices grew in lockstep. Between 2018-2020, however, relative prices in these at-risk markets finally declined by roughly 5% from their peak. Lender behavior cannot reconcile these patterns, as we show that both all-cash and mortgage-financed purchases have similarly contracted, with little evidence of increases in loan denial or securitization. We propose a demand-side explanation for our findings where prospective buyers have become more pessimistic about climate change risk than prospective sellers. The lead-lag relationship between transaction volumes and prices in SLR-exposed markets is consistent with dynamics at the peak of prior real estate bubbles.
{"title":"Neglected No More: Housing Markets, Mortgage Lending, and Sea Level Rise","authors":"Benjamin J. Keys, P. Mulder","doi":"10.2139/ssrn.3906066","DOIUrl":"https://doi.org/10.2139/ssrn.3906066","url":null,"abstract":"In this paper, we explore dynamic changes in the capitalization of sea level rise (SLR) risk in housing and mortgage markets. Our results suggest a disconnect in coastal Florida real estate: From 2013-2018, home sales volumes in the most-SLR-exposed communities declined 16-20% relative to less-SLR-exposed areas, even as their sale prices grew in lockstep. Between 2018-2020, however, relative prices in these at-risk markets finally declined by roughly 5% from their peak. Lender behavior cannot reconcile these patterns, as we show that both all-cash and mortgage-financed purchases have similarly contracted, with little evidence of increases in loan denial or securitization. We propose a demand-side explanation for our findings where prospective buyers have become more pessimistic about climate change risk than prospective sellers. The lead-lag relationship between transaction volumes and prices in SLR-exposed markets is consistent with dynamics at the peak of prior real estate bubbles.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"32 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75504843","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We estimate the causal effect of a mortgage supply expansion on house prices by using an exogenous change in prudential regulation: the abolition in 2006 of a banks' maturity transformation limit. After the repeal of the prudential rule, credit increased only for the banks that were previously constrained by the regulation, while it remained unchanged for the other banks. Such differential response rules out demand-based explanations and fully identify the rule abolition as an exogenous shock that we exploit as an instrument for mortgage supply expansion. We estimate the elasticity of house price growth to new mortgage credit to be close to 5 percent. Our results also show that the effect of a mortgage supply expansion on house prices significantly differs across municipalities' and borrowers' characteristics.
{"title":"Prudential Policies, Credit Supply and House Prices: Evidence from Italy","authors":"Pierluigi Bologna, Wanda Cornacchia, M. Galardo","doi":"10.2139/ssrn.3710119","DOIUrl":"https://doi.org/10.2139/ssrn.3710119","url":null,"abstract":"We estimate the causal effect of a mortgage supply expansion on house prices by using an exogenous change in prudential regulation: the abolition in 2006 of a banks' maturity transformation limit. After the repeal of the prudential rule, credit increased only for the banks that were previously constrained by the regulation, while it remained unchanged for the other banks. Such differential response rules out demand-based explanations and fully identify the rule abolition as an exogenous shock that we exploit as an instrument for mortgage supply expansion. We estimate the elasticity of house price growth to new mortgage credit to be close to 5 percent. Our results also show that the effect of a mortgage supply expansion on house prices significantly differs across municipalities' and borrowers' characteristics.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88713270","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract Real business cycles in China are different than in many other countries, including consumption being more volatile than output and uncorrelated with investment. To study whether Chinese institutions can account for these features, we augment the standard real business cycle model by private and state-owned enterprises facing time-to-build constraints, expropriations, and government expenditures. We introduce shocks to each of these activities and estimate our model with Bayesian techniques. The model matches the salient data moments quite closely, with expropriations playing a central role. In particular, shocks to expropriations account for over 70% of consumption and output volatility, and over 60% of private investment volatility. To assess whether our estimated expropriations are empirically plausible, we show that: (i) the model-generated expropriation series is positively correlated with a commonly used measure of property rights; (ii) the explanatory power of expropriations drops considerably after 2012, coinciding with the government’s anti-corruption campaign; and (iii) a placebo test estimating the model for the U.S. finds expropriations to be about one eighth of those in China, and to account for only a small share of the U.S. aggregate fluctuations.
{"title":"Property Rights, Expropriations, and Business Cycles in China","authors":"Yin Germaschewski, Jaroslav Horvath, Loris Rubini","doi":"10.2139/ssrn.3565144","DOIUrl":"https://doi.org/10.2139/ssrn.3565144","url":null,"abstract":"Abstract Real business cycles in China are different than in many other countries, including consumption being more volatile than output and uncorrelated with investment. To study whether Chinese institutions can account for these features, we augment the standard real business cycle model by private and state-owned enterprises facing time-to-build constraints, expropriations, and government expenditures. We introduce shocks to each of these activities and estimate our model with Bayesian techniques. The model matches the salient data moments quite closely, with expropriations playing a central role. In particular, shocks to expropriations account for over 70% of consumption and output volatility, and over 60% of private investment volatility. To assess whether our estimated expropriations are empirically plausible, we show that: (i) the model-generated expropriation series is positively correlated with a commonly used measure of property rights; (ii) the explanatory power of expropriations drops considerably after 2012, coinciding with the government’s anti-corruption campaign; and (iii) a placebo test estimating the model for the U.S. finds expropriations to be about one eighth of those in China, and to account for only a small share of the U.S. aggregate fluctuations.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"46 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85460762","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Simeon Djankov, E. Glaeser, V. Perotti, Andrei Shleifer
How do the different elements in the standard bundle of property rights – such as the right of possession or the right of transfer – differentially impact outcomes, such as urban development? This paper incorporates insecure property rights into a standard model of urban land prices and density, and makes predictions about investment in land and property, informality, and the efficiency of land use. Our empirical analysis links data on institutions related to land titling and transfer with multiple urban outcomes, from 190 countries. The evidence is generally consistent with the model’s predictions, and more broadly with the Demsetz’s (1967) approach to property rights institutions. Indeed, we document world-wide improvements in the quality of institutions facilitating property transfer over time.
{"title":"Measuring Property Rights Institutions","authors":"Simeon Djankov, E. Glaeser, V. Perotti, Andrei Shleifer","doi":"10.3386/W27839","DOIUrl":"https://doi.org/10.3386/W27839","url":null,"abstract":"How do the different elements in the standard bundle of property rights – such as the right of possession or the right of transfer – differentially impact outcomes, such as urban development? This paper incorporates insecure property rights into a standard model of urban land prices and density, and makes predictions about investment in land and property, informality, and the efficiency of land use. Our empirical analysis links data on institutions related to land titling and transfer with multiple urban outcomes, from 190 countries. The evidence is generally consistent with the model’s predictions, and more broadly with the Demsetz’s (1967) approach to property rights institutions. Indeed, we document world-wide improvements in the quality of institutions facilitating property transfer over time.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"3 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78679898","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
L. Garrido-da-Silva, S. Castro, João Correia-da-Silva
We investigate the endogenous emergence of residential and industrial districts around a central shopping district (CSD). Households wish to locate near firms and near the CSD due to commuting costs proportional to distance. Firms wish to locate near households because this reduces the wage they need to pay to attract workers, and near the CSD due to the iceberg cost of transporting their output to the CSD. Depending on the relative magnitude of three cost parameters (commuting to work, commuting to shop, transporting output), different urban structures arise. If the cost of commuting to shop is large and the cost of commuting to work is small (relatively to the cost of transporting output), households locate in the centre and firms in the periphery. The opposite occurs if both costs are very small. If the cost of commuting to shop is small and that of commuting to work is large, housing and industry become integrated. Complex urban structures emerge in intermediate cases.
{"title":"Location of Housing and Industry Around a Central Shopping District","authors":"L. Garrido-da-Silva, S. Castro, João Correia-da-Silva","doi":"10.2139/ssrn.3710912","DOIUrl":"https://doi.org/10.2139/ssrn.3710912","url":null,"abstract":"We investigate the endogenous emergence of residential and industrial districts around a central shopping district (CSD). Households wish to locate near firms and near the CSD due to commuting costs proportional to distance. Firms wish to locate near households because this reduces the wage they need to pay to attract workers, and near the CSD due to the iceberg cost of transporting their output to the CSD. Depending on the relative magnitude of three cost parameters (commuting to work, commuting to shop, transporting output), different urban structures arise. If the cost of commuting to shop is large and the cost of commuting to work is small (relatively to the cost of transporting output), households locate in the centre and firms in the periphery. The opposite occurs if both costs are very small. If the cost of commuting to shop is small and that of commuting to work is large, housing and industry become integrated. Complex urban structures emerge in intermediate cases.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":"140 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85334167","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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