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Who Lives Where in the City? Amenities, Commuting and Income Sorting

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  • Thisse, Jacques-François
  • Gaigtné, Carl
  • Koster, Hans
  • Moizeau, Fabien

Abstract

We study the sorting of income-heterogeneous consumers within cities. We allow for non-homothetic preferences and locations that are differentiated by their distance to employment centers and accessibility to exogenous amenities. The residential equilibrium is driven by the properties of an amenity-commuting aggregator obtained from the primitives of the model. Using micro-data on the Randstad (the Netherlands), we find that doubling the amenity level, resp. commuting time, attracts households whose incomes are 1 -2:5% higher, resp. 6 - 17:5% lower. Using the model's estimated parameters, we predict the impact of changes in accessibility to jobs and amenities on the social structure of the Randstad.

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  • Thisse, Jacques-François & Gaigtné, Carl & Koster, Hans & Moizeau, Fabien, 2017. "Who Lives Where in the City? Amenities, Commuting and Income Sorting," CEPR Discussion Papers 11958, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:11958
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    More about this item

    Keywords

    Cities; Social stratification; Income; Amenities; Commuting;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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