Modern cities

Abstract:

The central goal of this project is to establish a close collaboration betweenCopenhagen Business School (CBS) and Johns Hopkins Carey Business School. The anticipated project will be within the urban economics tradition. In our initialcommunications, we have identified several challenges related to modern cities.These encompass different urban disamenities such as congestion, noise, pollution, and the higher risks of spread of diseases (e.g. COVID 19). Others involve issues related to the labour market including the increasing commuting times, low real wage growth, and skills gap. But, maybe the largest of all is the raising housing prices (the apparent consequence of agglomeration economies) resulting from the migration to large cities (the urbanization process).Although many theories and models assume that a city is perfectly malleablewithout any cost, reality is different. Due to data limitations, many modelsdisregard the durable nature of real estate. Essentially, the durability imposes acost on transitions from one function to another. In this project the role oftransition costs and land use policy in explaining housing price increases,commuting flows and migration (urbanisation) will be considered using quantitative spatial models. The unique Danish register data available from Statistics Denmark, together with data for US cities collected and prepared by Johns Hopkins Carey Business School, can potentially be useful for extending and testing these models and provide guidance to future research in this area.