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Saving and consumption in cities

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  • Frame, David

Abstract

This paper examines urban residential location and rent determination within a city populated by consumers acting with perfect foresight. In this setting, the consumption and saving decisions of city residents are determined jointly with their choice of location, thereby offering an initial step to understanding how housing services influence non-durable consumption, and vice versa. Housing, supplied by profit-maximizing land owners, is distinguished from more non-descript varieties of durable consumption by the attributes and amenities it provides occupants. These attributes are limited in supply, indivisible, and distinguished by their location in geographic space and time of development.

Suggested Citation

  • Frame, David, 2013. "Saving and consumption in cities," Journal of Urban Economics, Elsevier, vol. 73(1), pages 111-124.
    • Handle: RePEc:eee:juecon:v:73:y:2013:i:1:p:111-124
    DOI: 10.1016/j.jue.2012.08.001
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    More about this item

    Keywords

    Housing; Housing rents; Intertemporal consumer choice;
    All these keywords.

    JEL classification:

    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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