A Recursive Spatial Equilibrium Model for Planning Large-Scale Urban Change

Abstract

This paper presents a recursive spatial equilibrium model for urban activity location and travel choices in large city regions that anticipate major development or restructuring. In the model, producer and consumer choices that adjust quickly to stimuli reach temporary equilibria subject to recursively updated activity churn, background trends, estate development, and transport supply. The city region's performance at each time horizon affects the recursive variables for the next. The model builds on field leaders of urban general equilibrium, spatial interaction, and nonequilibrium dynamic models, and offers theoretical and practical improvements in order to fill an important gap in long-range urban forecasting. Linking the equilibrium and nonequilibrium models enables the simulation of path dependence in urban evolution trajectories that neither could produce in isolation. At the same time the model provides quantification of impacts of different policy interventions on a consistent basis for a given time horizon. The model is tested on the main archetypal urban development strategies for large-scale development and restructuring.