KECD 2200 - URBAN AND REGIONAL ECONOMICS

The first part of the course is devoted to the microeconomics of within- and between city spatial organisation.

We will answer the following questions.

• Why do cities exist and induce an uneven spatial distribution of income, and of land and commodity prices?
• How can cities of different size co-exist within integrated economic areas?
• What does shape the city internal structure, in terms of housing types and income segregation?
• What is the impact of people and goods mobility on spatial concentration?
• What is the role of local public policies and of land use regulation on spatial disparities?

The second part of the course moves to the empirical studies that evaluate the gains and costs from agglomeration.

A special emphasis is put on the role of spatial sorting of workers with heterogeneous in skills.

The balance between income gains and costs of living is studied, typically questioning whether cities are too large or too small.

Studies about the value of consumption amenities (restaurants, cultural life, climate,…) will be presented too.

Outline :

1 Introduction: Trends in spatial disparities and course overview.

2 Why do cities exist? A review of agglomeration mechanisms.

3 Why are land prices higher in city centres? The monocentric city model.

4 How can large and smaller cities co-exist? Mobility and systems of cities.

5 The empirics of agglomeration economies.

6 The empirics of overall urban inequality.

Prerequisites :

Basic for second-year master:

• Microeconomics under perfect and imperfect competition (Micro I and II),
• Applied econometrics (I, II, including panel approaches and instrumentation).

Organisation :

Slides are circulated before the lectures such that students can concentrate on the course and participate through questions.

Work from one week to the other consists in carefully re-reading the slides and asking further clarification at the next course if needed. Extra readings will be suggested too.

Assessment :

The exam has two parts (two short essays to be written over a 4-week period) with equal weight for the grade.

Both parts are based on the reading of a recent research article (to be chosen within a long list).

A first essay will present the intuitions of the article and will relate and compare it to what is presented in class.

The second essay consists in a research project elaborated from the paper read for the first essay. It will present some weaknesses of the paper, propose solutions to address some of these limits, and present ideas for possible extensions and / or variants.