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Cost economies, urban patterns and population density: The case of public infrastructure for basic utilities
Author(s) -
Prieto Ángel M.,
Zofío José L.,
Álvarez Inmaculada
Publication year - 2015
Publication title -
papers in regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.937
H-Index - 64
eISSN - 1435-5957
pISSN - 1056-8190
DOI - 10.1111/pirs.12096
Subject(s) - economies of scale , population , economics , rationality , econometric model , economies of agglomeration , function (biology) , urban planning , scale (ratio) , urban economics , public economics , business , economic geography , regional science , econometrics , microeconomics , geography , engineering , civil engineering , cartography , evolutionary biology , political science , law , biology , demography , sociology
Determination of optimal population densities underlies the economic rationality when planning the provision of basic public infrastructure by local governments. Using econometric techniques based on the translog cost function, we investigate the existence of economies of scale, associated to a larger urban size in terms of population and housing, determine the effect of alternative urban patterns – compact or dispersed – on the cost of provision, and calculate optimal population densities as targets for urban planning. We illustrate the practicality of our model using Spanish municipal data, and unveil latent economies of scale and suboptimal urban densities due to excessive dispersion. Based on these findings we propose specific policy guidelines in terms of desirable urban structures.