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A computable general equilibrium model of the city: impacts of technology, zoning, and trade


  • Craig Olwert
  • Jean-Michel Guldmann


This paper presents a computable general equilibrium model of a stylized linear city that simultaneously minimizes transportation costs while satisfying labor, and, and goods equilibrium conditions, in the tradition of Anas and Kim, while introducing a monetary balance. This model has structural similarity with Davis’s design of an optimal transportation system under user equilibrium conditions. The model includes three industries: manufacturing, retail, and services. Their economic transactions are empirically modeled using national input – output data, which allows for the endogenous determination of import and export pricing and flows. Numerical applications show that more efficient transportation increases utility and leads to a centralization of the population, and that zoning, under various restriction scenarios, decreases utility, with the most detrimental effects on residents in unrestricted zones. Finally, a zero trade deficit scenario results in lower utility, a larger transportation system, and smaller residential lots, with higher CBD population density. Keywords: computable general equilibrium, land use and transportation, regional planning, trade, zoning, input – output data

Suggested Citation

  • Craig Olwert & Jean-Michel Guldmann, 2012. "A computable general equilibrium model of the city: impacts of technology, zoning, and trade," Environment and Planning A, Pion Ltd, London, vol. 44(1), pages 237-253, January.
  • Handle: RePEc:pio:envira:v:44:y:2012:i:1:p:237-253

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    Cited by:

    1. Georg Hirte & Stefan Tscharaktschiew, 2015. "Why not to choose the most convenient labor supply model? The impact of labor supply modeling on policy evaluation," ERSA conference papers ersa15p303, European Regional Science Association.

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