It's time to throw out the standard urban economics model
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The workhorse model of urban economics is the Alonso-Muth-Mills (AMM) model of the mono-centric city (the modern treatment is attributable to Jan Bruckner). This model is basically the representative agent optimal-control model of neoclassical economics. It is modified with additional functions that account for the cost of commuting to a city centre from different distances and allows capital, K, to be optimally geographically dispersed as well.
It's time to throw out the standard urban economics model
It's time to throw out the standard urban…
It's time to throw out the standard urban economics model
The workhorse model of urban economics is the Alonso-Muth-Mills (AMM) model of the mono-centric city (the modern treatment is attributable to Jan Bruckner). This model is basically the representative agent optimal-control model of neoclassical economics. It is modified with additional functions that account for the cost of commuting to a city centre from different distances and allows capital, K, to be optimally geographically dispersed as well.