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Decentralization Essay

1019 words - 5 pages

Urban Economy Theory #2 - Spatial pattern of employment
Although urban economists often assume that employment in urban areas is concentrated
at the central business district (CBD), in actuality urban employment has been suburbanizing for a long time (White, 1999). Decentralized cities also have a wage gradient, which relates wages to distance from the CBD for identical jobs. Workers living at particular residential locations have a wage offer curve that indicates the minimum amount they must be paid to be willing to work at any job location. Households in the decentralized city will tend to segregate into different residential areas depending on their workers' job locations. For ...view middle of the document...

Thus, the aggregate utility in this case is the sum of the product of the individual household utility and the number of household in each center:
Ut = { Ni Ui
Ut : utility of a decentralized city in transition period

Ui : level of household utility that prevails in center i

Ni : number of household in center

To analyze the social optimality, first consider the monocentric city and the decentralized city in market equilibrium. The decentralization will reduce congestion near and around the CBD because the number of households will decrease. Thus, transportation cost and rent at the CBD of the decentralized city will be smaller than those of the monocentric city. Reduction in transportation cost and rent will lead to higher levels of utility and aggregate utility of the decentralized city and the decentralized city will therefore be more efficient than the monocentric city (Chalermpong, 1998). While traveled distance generally increases with distance to the city center, which constitutes a major source of adverse effects of urban sprawl, the time spent in transport tends to decrease, thus creating a strong incentive to sprawl (Breteau, 2011).

Large-scale urban decentralization has transformed the landscape of the CBD, particularly in the past 50 years (Beauregard, 1989). The rim of urban development is now far from the traditional core, and a new metropolitan terrain has evolved with the rapid development of suburbs and the loss of central city prominence (Hanlon, 2007). Suburbs have essentially become the favored site of development in the United States, consistently attracting more and more residents. Jobs, investment and economic growth have also sub-urbanized. The center of metropolitan gravity has shifted outward. The United States is now a metropolitan society dominated by the suburbs (Hanlon, 2007).
This research shows how decentralization factors that caused the decline of the first-ring suburbs of the 1940s and 1950s have continued to the outgrowth of urban sprawl of today. Through the urban economy conditions of partial distribution of industry location(s) and spatial pattern(s) of employment both of these urban economy phenomenons have had a dramatic effect on not only the demise of central cities...

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