Journey and Transactions Frequency: An Alternative Explanation of Rent-gradient Convexity

This paper contends that in many real-world situations, the frequency with which transactions take place is central to the relationship between land prices and location. It will therefore be argued that an approach which makes the transactions and journey frequency endogenous to the cost problem is the correct way in which time should be incorporated into many urban rent-distance models. Under these conditions, it can be shown that a convex distance-rent gradient can be generated without the need for the assumption of a convex indifference curve or isoquant. Furthermore, in many such cases, the convex distance-rent curve can be shown to exist irrespective of whether transport costs are concave, linear or greater than linear with distance. Real examples will be used to illustrate the problem.