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Compact or spread-out cities: Urban planning, taxation, and the vulnerability to transportation shocks

  • Gusdorf, Francois
  • Hallegatte, Stephane

This paper shows that cities made more compact by transportation taxation are more robust than spread-out cities to shocks in transportation costs. Such a shock, indeed, entails negative transition effects that are caused by housing infrastructure inertia and are magnified in low-density cities. Distortions due to a transportation tax, however, have in absence of shock detrimental consequences that need to be accounted for. The range of beneficial tax levels can, therefore, be identified as a function of the possible magnitude of future shocks in transportation costs. These taxation levels, which can reach significant values, reduce city vulnerability and prevent lock-ins in under-optimal situations.

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Article provided by Elsevier in its journal Energy Policy.

Volume (Year): 35 (2007)
Issue (Month): 10 (October)
Pages: 4826-4838

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Handle: RePEc:eee:enepol:v:35:y:2007:i:10:p:4826-4838
Contact details of provider: Web page: http://www.elsevier.com/locate/enpol

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