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Household location and income: a spatial analysis for British cities

Listed author(s):
  • David Cuberes

    ()

    (Clark University)

  • Jennifer Roberts

    ()

    (Department of Economics, University of Sheffield)

Using information on the exact location of urban households in Britain for the period 2009-2013 we explore the validity of standard urban land use models by estimating the extent to which distance of residence from the city centre is a function of income. This is the first study of its kind for British cities. After controlling for household characteristics and access to transport, as well as city and time effects, and taking account of both spatial and serial correlation, we find a strong positive association between household’s income and distance from the city centre. We also estimate the income elasticity of demand for land and find that this is not large enough to support the view that richer households locate further from the city centre mainly because they prefer larger dwellings. Finally, we find that while poorer households live closer to the city centre, they have experienced increasing real incomes over the period relative to those who live further away. This supports the view that cities in Britain attract poor people rather than generate poverty.

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File URL: http://www.sheffield.ac.uk/economics/research/serps/articles/2015_022
File Function: First version, October 2015
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Paper provided by The University of Sheffield, Department of Economics in its series Working Papers with number 2015022.

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Length: 34 pages
Date of creation: Oct 2015
Handle: RePEc:shf:wpaper:2015022
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  1. Manning, Alan, 2003. "The real thin theory: monopsony in modern labour markets," Labour Economics, Elsevier, vol. 10(2), pages 105-131, April.
  2. Fujita,Masahisa, 1991. "Urban Economic Theory," Cambridge Books, Cambridge University Press, number 9780521396455, January.
  3. Brueckner, Jan K. & Thisse, Jacques-Francois & Zenou, Yves, 1999. "Why is central Paris rich and downtown Detroit poor?: An amenity-based theory," European Economic Review, Elsevier, vol. 43(1), pages 91-107, January.
  4. Jan K. Brueckner & Stuart S. Rosenthal, 2009. "Gentrification and Neighborhood Housing Cycles: Will America's Future Downtowns Be Rich?," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 725-743, November.
  5. Brueckner, Jan K., 2011. "Lectures on Urban Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262016362.
  6. McKinnish, Terra & Walsh, Randall & Kirk White, T., 2010. "Who gentrifies low-income neighborhoods?," Journal of Urban Economics, Elsevier, vol. 67(2), pages 180-193, March.
  7. Gabriel M. Ahlfeldt & Nicolai Wendland, 2010. "How Polycentric is a Monocentric City? The Role of Agglomeration Economies," EERI Research Paper Series EERI_RP_2010_24, Economics and Econometrics Research Institute (EERI), Brussels.
  8. Glaeser, Edward L. & Kahn, Matthew E. & Rappaport, Jordan, 2008. "Why do the poor live in cities The role of public transportation," Journal of Urban Economics, Elsevier, vol. 63(1), pages 1-24, January.
  9. Wheaton, William C, 1977. "Income and Urban Residence: An Analysis of Consumer Demand for Location," American Economic Review, American Economic Association, vol. 67(4), pages 620-631, September.
  10. George C. Galster, 2005. "Consequences From the Redistribution of Urban Poverty During the 1990s: A Cautionary Tale," Economic Development Quarterly, , vol. 19(2), pages 119-125, May.
  11. Alasdair Rae, 2012. "Spatially Concentrated Deprivation in England: An Empirical Assessment," Regional Studies, Taylor & Francis Journals, vol. 46(9), pages 1183-1199, October.
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