The Costs of Agglomeration: Land Prices in French Cities

Pierre-Philippe Combes (1) , Gilles Duranton (2) , Laurent Gobillon (3, 4, 5)

1 GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille
2 Wharton School, University of Pennsylvania
3 INED - Institut national d'études démographiques
4 PSE - Paris-Jourdan Sciences Economiques
5 PSE - Paris School of Economics

We develop a new methodology to estimate the elasticity of urban costs with respect to city population using French land price data. Our preferred estimate, which handles a number of estimation concerns, stands at 0.041. Our approach also yields a number of intermediate outputs of independent interest such as a distance gradient for land prices and the elasticity of unit land prices with respect to city population. For the latter, our preferred estimate is 0.72.

Mots clés: agglomeration; urban costs; land prices; land use

Domaines: Economies et finances

Pierre-Philippe Combes, Gilles Duranton, Laurent Gobillon. The Costs of Agglomeration: Land Prices in French Cities. 2012. ⟨halshs-00793632⟩