Abstract

The assumption that population and structural densities are defined over parcels of land with zero area is problematic when interpreting the standard residential land use model as approximating a large finite economy. This paper extends revealed preference theory to depict a spatial economy with land parcels of finite area. The model generalizes the standard utility function approach, allowing for many consumer types with different tastes and incomes and labor-leisure choice, to show that the most important predictions of the standard theory hold in the general finite framework studied here.

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