A Research Programme on Urban Dynamics
5
Later research overcame some of the limitations mentioned above by focusing on
the fifth class of city size optimality, where marginal location costs equal marginal
location benefits. Within a system in spatial balance, a rational planner looks at
urban optimal sizes through marginal conditions (Camagni et al. 2013). The model
discussed in this last paper delivers a continuum of equilibrium city sizes, due to
rational consumers deciding their locations on the basis of a classical “MC = MB”
1
optimal condition. This framework also allows for a comparison on a cross-section
of cities solving the logical impossibility stemming from the Henderson critique.
The model is also supported by an empirical assessment of the factors at the core of
benefits and costs, determining equilibrium city size irrespective of their dimensions.
These determinants encompass the quality of functions hosted but also other economic, social and environmental factors. The model strikes a balance between the
dichotomy of “one vs. infinite optimal sizes”: “cities are supposed to share the same
cost and production functions with heterogeneous, substitutable factors” (economic
functions and other context conditions). Also, “each of them maintains its specificity
and, consequently, its ‘equilibrium’ size, but comparability and possibility of running
cross-sectional analyses is saved, and also possibility of devising policy strategies
for urban growth and containment” (Camagni et al., p. 313).
However, the remnants of these empirical estimates remain unexplained, or, to
put it more accurately, amenable to alternative explanations. Along with true i.i.d.
disturbances, residuals also capture potentially omitted variables such as good or
bad governance, which may potentially sustain population levels above or below
structural equilibrium ones.
3 On Urban Hierarchy and Central Place Theory
Central place theory (henceforth, CPT) explains the existence of urban systems as
the result of the tension underlying centripetal and centrifugal forces, which create
regular structures whereby cities of different ranks coexist and, in the Lösch version,
can focus on performing different economic activities.
This theory introduced several fundamental advances in our understanding of
urban systems. One such improvement lies in the role played by functions (in Christallerian contributions, specific per rank) in explaining the spatial distribution of cities
across a system. The rank of a city explains its function, and therefore its size,
leaving within an urban system space for cities of varying sizes. Paradoxically, this
result was indirectly neglected for several years by the modern spatial equilibrium
approach à la Von Thünen-Alonso-Fujita (Camagni 1992). Theoretical neoclassical
models of stylized cities typically work on the assumption of location choice indifference, which posits that lower accessibility to the centre is compensated by lower
rents and higher environmental quality. Extending the same approach to city systems
equilibria, indifference in location choices is satisfied only when cities provide the
1 MC: Marginal Costs; MB: Marginal Benefits.
5
Later research overcame some of the limitations mentioned above by focusing on
the fifth class of city size optimality, where marginal location costs equal marginal
location benefits. Within a system in spatial balance, a rational planner looks at
urban optimal sizes through marginal conditions (Camagni et al. 2013). The model
discussed in this last paper delivers a continuum of equilibrium city sizes, due to
rational consumers deciding their locations on the basis of a classical “MC = MB”
1
optimal condition. This framework also allows for a comparison on a cross-section
of cities solving the logical impossibility stemming from the Henderson critique.
The model is also supported by an empirical assessment of the factors at the core of
benefits and costs, determining equilibrium city size irrespective of their dimensions.
These determinants encompass the quality of functions hosted but also other economic, social and environmental factors. The model strikes a balance between the
dichotomy of “one vs. infinite optimal sizes”: “cities are supposed to share the same
cost and production functions with heterogeneous, substitutable factors” (economic
functions and other context conditions). Also, “each of them maintains its specificity
and, consequently, its ‘equilibrium’ size, but comparability and possibility of running
cross-sectional analyses is saved, and also possibility of devising policy strategies
for urban growth and containment” (Camagni et al., p. 313).
However, the remnants of these empirical estimates remain unexplained, or, to
put it more accurately, amenable to alternative explanations. Along with true i.i.d.
disturbances, residuals also capture potentially omitted variables such as good or
bad governance, which may potentially sustain population levels above or below
structural equilibrium ones.
3 On Urban Hierarchy and Central Place Theory
Central place theory (henceforth, CPT) explains the existence of urban systems as
the result of the tension underlying centripetal and centrifugal forces, which create
regular structures whereby cities of different ranks coexist and, in the Lösch version,
can focus on performing different economic activities.
This theory introduced several fundamental advances in our understanding of
urban systems. One such improvement lies in the role played by functions (in Christallerian contributions, specific per rank) in explaining the spatial distribution of cities
across a system. The rank of a city explains its function, and therefore its size,
leaving within an urban system space for cities of varying sizes. Paradoxically, this
result was indirectly neglected for several years by the modern spatial equilibrium
approach à la Von Thünen-Alonso-Fujita (Camagni 1992). Theoretical neoclassical
models of stylized cities typically work on the assumption of location choice indifference, which posits that lower accessibility to the centre is compensated by lower
rents and higher environmental quality. Extending the same approach to city systems
equilibria, indifference in location choices is satisfied only when cities provide the
1 MC: Marginal Costs; MB: Marginal Benefits.