Spatial Costs in a Monocentric City(And Implications for Agglomeration)
AbstractUsing water supply as a model for a wider range of infrastructure services, the effect of a negative exponential density gradient on distribution costs is investigated for four monocentric urban development scenarios: (a) Densification; (b) Dispersion; (c) Suburbanisation; and (d) Constant density. It is shown that economies of scale in production can be outweighed by diseconomies in distribution in cases (b) and (c), suggesting that the agglomeration benefits of infrastructure cannot be taken for granted. They depend as much on the effect of density on distribution costs as the effect of size on production costs.
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Bibliographic InfoPaper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number 0032.
Date of creation: Oct 2009
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Web page: http://www.spatialeconomics.ac.uk/SERC/publications/default.asp
Urbanisation; spatial analysis; returns to scale; water utilities;
Find related papers by JEL classification:
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L95 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Gas Utilities; Pipelines; Water Utilities
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- NEP-ALL-2010-11-20 (All new papers)
- NEP-GEO-2010-11-20 (Economic Geography)
- NEP-URE-2010-11-20 (Urban & Real Estate Economics)
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