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Abstract

During the period 1910 to 1970, an increasing fraction of the urban population in the US chose to live on the outskirts of central cities. This was also a time when a major innovation in transportation technology, the automobile, was introduced and widely adopted. The objective of this paper is to assess quantitatively the relationship between the two. To achieve this, a simple model is constructed in which agents can choose where to live and whether or not to buy a car. When the model is calibrated, it can explain about 70 percent of the rise in car-ownership over the period 1910 to 1970 and all of the suburbanization trend. According to the model, rising income and falling car prices alone are not enough to generate the suburbanization trend. It is essential to have also: (i) a declining cost of commuting by car which allows car-owners to live further away from the city center, and (ii) a rising cost of using public transportation which encourages agents to make the swith to automobiles.

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Bibliographic Info

Paper provided by Economie d'Avant Garde in its series Economie d'Avant Garde Research Reports with number 6.

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Length: 37 pages
Date of creation: Jan 2004
Date of revision: May 2005
Handle: RePEc:eag:rereps:6

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Web page: http://www.jeremygreenwood.net/EAG.htm

Related research

Keywords: automobiles; suburbanization; population density gradients;

Other versions of this item:

Find related papers by JEL classification:

• E10 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - General
• O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
• N12 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - U.S.; Canada: 1913-
• R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

This paper has been announced in the following NEP Reports:

• NEP-ALL-2006-07-02 (All new papers)
• NEP-URE-2006-07-02 (Urban & Real Estate Economics)

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Cited by:

1. Gilles Duranton & Matthew A. Turner, 2007. "Urban growth and transportation," Working Papers tecipa-305, University of Toronto, Department of Economics.
   
   • Gilles Duranton & Matthew A. Turner, 2012. "Urban Growth and Transportation," Review of Economic Studies, Oxford University Press, vol. 79(4), pages 1407-1440.
   • Duranton, Gilles & Turner, Matthew A, 2008. "Urban Growth and Transportation," CEPR Discussion Papers 6633, C.E.P.R. Discussion Papers.
2. Robert A. Margo & Leah Platt Boustan, 2011. "White Suburbanization And African-American Home Ownership, 1940-1980," Boston University - Department of Economics - Working Papers Series WP2011-024, Boston University - Department of Economics.
   
   • Leah Platt Boustan & Robert A. Margo, 2011. "White Suburbanization and African-American Home Ownership, 1940-1980," NBER Working Papers 16702, National Bureau of Economic Research, Inc.
3. Dan Li & T. Lakshmanan & Chun-Yu Ho & W. Anderson, 2010. "An empirical analysis of household choices on housing and travel mode in Boston," The Annals of Regional Science, Springer, vol. 45(2), pages 423-438, October.
4. David Lagakos, 2007. "Explaining Cross-Country Productivity Differences in Retailing," 2007 Meeting Papers 951, Society for Economic Dynamics.

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1. Studies on the automobile industry

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