econ 135 fall08 lecture5

econ 135 fall08 lecture5 - Lecture 5 Suburbanization of...

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1 Lecture 5 Suburbanization of People and Jobs Suburbanization refers to the tendency of both households and firms to move further from the CBD. Note that when firms move out of the CBD, cities become non- monocentric. Percent of Metropolitan Population and Employment Located in Central Cities 1948 1990 % change Population 64 39 -39 Manufacturing 67 45 -33 Wholesale trade 92 49 -47 Retail trade 75 48 -36 Selected services 85 52 -39 Note: population suburbanized earlier than employment, but this suggests that employment has caught up. (Question: What if central city boundaries change?)
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2 Estimates of how the density function parameter b from d e D d D O b - = ) ( Changes over time: ( b = percentage decline in population per one mile increase in distance from the CBD) Results for population density for 4 metropolitan areas: b % of pop within 3 miles of the CBD 1880 1.22 88 1900 .96 78 1920 .69 61 1940 .59 53 1954 .40 34 1963 .31 24 Suburbanization occurred very rapidly in the early period and then slowed during the depression of the 1930’s and WWII.
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3 Why does suburbanization of population occur? 1. Housing is durable. So when new housing is built, it is cheaper to build it at the edge of the city where there is vacant land than to demolish existing housing closer to the center. (New construction is cheaper than renovation.) Households prefer new to old housing, since new housing embodies current styles and technology (more bathrooms, family rooms, security systems, skylights, etc). Richer households occupy new houses, middle class households move to the houses that the rich vacate and the poor occupy housing that the middle class households vacate. This is called filtering . Question: suppose housing lasted only for a year. Would cities be more compact? 2. As incomes rise, households prefer larger housing units as well as newer ones. They buy them in the suburbs, where the per unit cost of housing is lower.
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4 3. Rich households want to flee central city crime and bad schools. They move out of the central city to suburbs. Many suburbs have zoning policies that keep out the poor by prohibiting the building of apartments. 4.
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econ 135 fall08 lecture5 - Lecture 5 Suburbanization of...

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