Location Decisions Of Households Research Articles

A behavioral housing search model: Two-stage hazard-based and multinomial logit approach to choice-set formation and location selection

Residential location search has become an important topic to both practitioners and researchers as more detailed and disaggregate land-use and transportation demand models are developed which require information on individual household location decisions. The housing search process starts with an alternative formation and screening stage. At this level households evaluate all potential alternatives based on their lifestyle, preferences, and utilities to form a manageable choice set with a limited number of plausible alternatives. Then the final residential location is selected among these alternatives. This two-stage decision making process can be used for both aggregate zone-level selection as well as searching disaggregate parcel or building-based housing markets for potential dwellings. In this paper a zonal level household housing search model is developed. Initially, a household specific choice set is drawn from the entire possible alternatives in the area based on the average household work distance to each alternative. Following the choice set formation step, a discrete choice model is utilized for modeling the final residential zone selection of the household. A hazard-based model is used for the choice set formation module while the final choice selection is modeled using a multinomial logit formulation with a deterministic sample correction factor. The approach presented in the paper provides a remedy for the large choice set problem typically faced in housing search models.

Real estate function impact on its value exemplified by the city of Gdańsk

Spatial planning is connected with speculations in real estate market, which deepens the process of urban sprawl. Adequate land management supporting free market – both investment decision of businesses and location decisions of households – is necessary if amorphous city growth is to be prevented. A change, or even information about change in the local plan determines decisions in the real estate market. On the basis of the studies conducted it can be said that the factor causing the greatest value increment is the possibility of development. To assess the possible success of investment projects and the value of real estate it is important to identify the changes that have been occurring in the growth of urban areas and their suburban expansion; whether they follow a certain pattern and whether it is possible to foresee them. The article presents city growth stages and models as well as selected concepts of sustainable growth as a response to the adverse process of suburbanisation.

A random-parameter hazard-based model to understand household evacuation timing behavior

The goal of this paper is to develop a random-parameter hazard-based model to understand hurricane evacuation timing by individual households. The choice of departure time during disasters is a complex dynamic process and depends on the risk that the hazard represents, the characteristics of the household and the built environment features. However, the risk responses are heterogeneous across the households; this unobserved heterogeneity is captured through random parameters in the model. The model is estimated with data from Hurricane Ivan including households from Alabama, Louisiana, Florida and Mississippi. It is found that the variables related to household location, destination characteristics, socio-economic characteristics, evacuation notice and household decision making are key determinants of the departure time. As such the developed model provides some fundamental inferences about hurricane evacuation timing behavior.

The influence of (toll-related) travel costs in residential location decisions of households: A stated choice approach

In this paper, we investigate the impact of travel costs, in particular toll costs, on the residential location choice of households, using a stated choice survey. Within the stated choice experiment, car drivers that frequently face traffic congestion, traded-off several trip-related (including toll costs) and house/location-related factors in their decision where to locate. If we look at the influence of different variables, toll and fuel costs seem to be important. Respondents are more sensitive to travel costs (i.e. toll and fuel costs) than to equally high (monthly) housing costs. Travel time appears to play a less important role, as indicated by a low value of time (VOT). In addition, location-related factors, such as the type of location and the number of bedrooms, turn out to be important factors as well. It can be concluded that respondents generally speaking prefer to pay higher housing costs and accept longer travel times to avoid (high) travel costs. Finally, if we look at the difference in preferences in relation to toll and fuel cost, we can conclude that toll costs are valued more negatively than fuel costs, although the differences are small.

The racial geography of street vice

Street vice (anonymous prostitution, gambling, and the sale of illicit drugs) is spatially concentrated and confined largely to Black neighborhoods in central cities, even though demand is quite evenly distributed throughout the general population. We show how this pattern can arise through the interacting location decisions of sellers, buyers, and non-user households. Areas with high demand density (cities) have lower prices and more tightly packed sellers in equilibrium relative to areas with lower demand density (suburbs) under autarky. When trade between city and suburb is possible, competitive pressure from the city lowers suburban prices and seller density. Higher income households distance themselves from street vice, causing the exposed population to become poorer and disproportionately Black. Even mild preferences over neighborhood racial composition can then induce lower income Whites to exit, resulting in racial segregation. The relationship between segregation and exposure to vice can be non-monotonic and discontinuous: decreased segregation implies greater sorting by income, and hence larger wage disparities between city and suburb. If such disparities get too large, all sales can shift discontinuously to the city and result in higher overall Black exposure even though more Blacks now reside in the suburbs.

Sex Changes Everything

The average U.S. male historically commutes further and longer than his female counterpart. Yet pivotal changes at home, as younger women especially increase their influence on household location and work decisions, and in the labor market, and as women's participation rates and profiles approach men's, strongly suggest that gender's influence on travel might be changing as well. Furthermore, the independent and interactive influence of other demographic factors, not least age and race, remain unclear. This study analyzes national microdata covering the past 20 years to examine both issues. We find sources of both convergence and divergence in travel behaviors by sex. The gender gap in commute length of older workers is growing, even while that of younger workers steadily closes. At the same time, racial differences in mode choice and commute times are becoming less pronounced—both by race and by gender. Thus, gendered elements of travel demand are indeed evolving, if not in predictable directions.

Migration and hedonic valuation: The case of air quality

Conventional hedonic techniques for estimating the value of local amenities rely on the assumption that households move freely among locations. We show that when moving is costly, the variation in housing prices and wages across locations may no longer reflect the value of differences in local amenities. We develop an alternative discrete-choice approach that models the household location decision directly, and we apply it to the case of air quality in US metro areas in 1990 and 2000. Because air pollution is likely to be correlated with unobservable local characteristics such as economic activity, we instrument for air quality using the contribution of distant sources to local pollution—excluding emissions from local sources, which are most likely to be correlated with local conditions. Our model yields an estimated elasticity of willingness to pay with respect to air quality of 0.34–0.42. These estimates imply that the median household would pay $149–$185 (in constant 1982–1984 dollars) for a one-unit reduction in average ambient concentrations of particulate matter. These estimates are three times greater than the marginal willingness to pay estimated by a conventional hedonic model using the same data. Our results are robust to a range of covariates, instrumenting strategies, and functional form assumptions. The findings also confirm the importance of instrumenting for local air pollution.

Fujita and Ogawa Revisited: An Agent-Based Modeling Approach

This paper builds on and extends a classic paper (hereafter referred to as F–O) published by Masahisa Fujita and Hideaki Ogawa in 1982. Their paper models the emergence of urban centers brought about by household and firm location decisions in the context of spatially differentiated labor and land market interactions. Their approach is an analytical one that seeks to characterize the equilibrium values of the system. In contrast, we employ an agent-based modeling (ABM) approach that seeks to replicate the individual household and firm behaviors that lead to equilibrium or nonequilibrium outcomes. The F–O model has little to say about what happens outside of equilibrium, while the ABM approach is preoccupied with this question and is particularly well suited to address questions of path dependency and bounded rationality that lie well beyond the scope of the F–O original. We demonstrate that the urban outcomes that emerge depend critically upon the bidding behavior of agents and the institutional context within which their decisions are made.

Have Amenities Become Relatively More Important than Firm Productivity Advantages in Metropolitan Areas?

We analyze patterns of compensating differentials to determine whether a region's bundle of site characteristics has a greater net effect on household location decisions relative to firm location decisions in U.S. metropolitan areas over time. We estimate skill-adjusted wages and attribute-adjusted rents using hedonic regressions for 238 metropolitan areas in 1990 and 2000. Within the framework of the standard Roback model, we classify each metropolitan area based on whether amenities or firm productivity advantages dominate and analyze the extent to which these classifications change between 1990 and 2000. We then decompose compensating differentials into amenity and firm productivity advantage components and examine how these components change. Empirical results suggest that while the relative importance of amenities appears to have increased slightly between 1990 and 2000, firm productivity advantages continued to dominate amenities in the vast majority of metropolitan areas during this decade.

Household Location Choices: Implications for Biodiversity Conservation

Successful conservation efforts require understanding human behaviors that directly affect biodiversity. Choice of household location represents an observable behavior that has direct effects on biodiversity conservation, but no one has examined the sociocultural predictors of this choice relative to its environmental impacts. We conducted a case study of the Teton Valley of Idaho and Wyoming (U.S.A.) that (1) explored relationships between sociodemographic variables, environmental attitudes, and the environmental impact of household location choices, (2) assessed the potential for small household sizes in natural areas to multiply the environmental impacts of household location decisions, and (3) evaluated how length of residency predicted the environmental attitudes of people living in natural areas. We collected sociodemographic data, spatial coordinates, and land-cover information in a survey of 416 households drawn from a random sample of Teton Valley residents (95% compliance rate). Immigrants (respondents not born in the study area) with the lowest education levels and least environmentally oriented attitudes lived in previously established residential areas in disproportionately high numbers, and older and more educated immigrants with the most environmentally oriented attitudes lived in natural areas in disproportionately high numbers. Income was not a significant predictor of household location decisions. Those living in natural areas had more environmental impact per person because of the location and because small households (<3 people/household) were 4 times as likely in natural areas as large households. Longer residency in natural areas predicted less environmentally oriented attitudes, suggesting that living in natural areas does not foster more concern for nature. Because populaces are rapidly aging, growing more educated, and potentially growing more environmentally oriented, these patterns are troubling for biodiversity conservation. Our results demonstrate a need for environmentalists to make household location decisions that reflect their environmental attitudes and future research to address how interactions between education level, environmental attitudes, population aging, and household location choices influence biodiversity conservation.

What Causes Spatial Variations in Economic Development in the United States?

AbstractThis article examines the causes of spatial disparities in economic development in the United States. A theoretical model is developed to analyze the location decisions of firms and households. An empirical model is estimated to quantify the contribution of alternative factors to spatial variations in wage, employment density, housing price, and land development density. Results suggest that remoteness is a primary cause of spatial disparities in economic development, while natural amenities are a major determinant of housing prices. Despite the dominant role of geography, public investments in infrastructure and human capital development could contribute to economic development in remote areas.

Verkehrskosten der Randwanderung privater Haushalte

Location-specific costs are of major significance for a private household's location decisions. The paper estimates the additional transport costs a household has to face as a consequence of residential suburbanisation. The major components of these costs are changes in household motorisation and travel distances covered by specific modes. The results indicate significant increases in transport costs as an effect of suburbanisation. The increase is particularly strong for employees and households purchasing (an) additional automobile(s). A household composed of one employee and one non-employed individual who purchases one additional car has to expect additional transport costs ranging between 350 and 400 € per month, depending on the chosen location.

Do Two-earner Households Base Their Choice of Residential Location on Both Incomes?

This article focuses on the role of individual incomes in the residential location decisions of two-earner households. Conventional studies often treat households as a black box and describe them by a single utility function. The article raises the question, "Is the household utility paradigm an adequate framework for understanding the location decisions of two-earner households?". It tests an implication of the household utility paradigm-the income-pooling hypothesis for location decisions. The results provide evidence for rejecting the hypothesis among childless families, but fail to provide evidence for rejecting it when children are present. The results raise the need to address intrahousehold dynamics in modelling location decisions.

Latent lifestyle preferences and household location decisions

Lifestyle, indicating preferences towards a particular way of living, is a key driver of the decision of where to live. We employ latent class choice models to represent this behavior, where the latent classes are the lifestyles and the choice model is the choice of residential location. Thus, we simultaneously estimate lifestyle groups and how lifestyle impacts location decisions. Empirical results indicate three latent lifestyle segments: suburban dwellers, urban dwellers, and transit-riders. The suggested lifestyle segments have intriguing policy implications. Lifecycle characteristics are used to predict lifestyle preferences, although there remain significant aspects that cannot be explained by observable variables.

You Can Take It with You: Transferability of Proposition 13 Tax Benefits, Residential Mobility, and Willingness to Pay for Housing Amenities

In 1978, Californians approved Proposition 13, which fixed property tax rates at 1% of housing prices at the time of purchase. Beyond its fiscal consequences, Proposition 13 created a lock-in effect on housing choice because of the implicit tax break enjoyed by homeowners living in the same house for a long time. In this paper, I provide estimates of this lock-in effect, using a natural experiment created by two subsequent amendments to Proposition 13 - Propositions 60 and 90. These amendments allow households headed by an individual over the age of 55 to transfer the implicit tax benefit to a new home. I show that mobility rates of 55-year old homeowners are approximately 25% higher than those of 54-year olds. The second contribution of this paper is the incorporation of transaction costs, due to Proposition 13, into a household location decision model, providing a new way to estimate marginal willingness to pay (MWTP) for housing characteristics. The key insight of this model is that because of the property tax laws, different potential buyers have different user costs for the same house. The exogenous property tax component of this user cost then works as an instrument to solve the main identification problem of revealed preference models - the correlation between price and unobserved quality of the product.

Impact of Local Public Services and Taxes on Dwelling Choice Within a Single Taxing Jurisdiction: A Discrete Choice Model

Discrete choice models of household location assume local public finance variables remain the same within a given taxing jurisdiction. Thus far, no such model has tested the validity of this assumption. This study employs McFadden’s (1978, 2001) discrete choice model to test or the significance of dwelling-specific local taxes and public services on household location decisions within a single taxing jurisdiction. The findings indicate that such variables are significant determinants of location decisions even within a single taxing jurisdiction, and should not be assumed away. Failure to include such variables in a model may, thereore, result in biased statistical results.

MOBILITY AND ACCESSIBILITY EFFECTS OF B2C E‐COMMERCE: A LITERATURE REVIEW

ABSTRACTThis paper explores the mobility and accessibility effects of business‐to‐consumer (b2c) e‐commerce by means of a literature review. The main questions are how b2c e‐commerce affects (a) individual activity patterns and travel behaviour, (b) the freight transport and logistic decisions of firms, and (c) the location decisions of households and firms. The review shows that the direct (short‐term) mobility effects of b2c e‐commerce are relatively clear, and that an overall increase in both individual travel and freight transport can be expected. The indirect (long‐term) changes for physical accessibility and mobility, however, are less clear and harder to deal with, due to the complex relationships, time lags, data problems and methodological (attribution) problems. Still, it appears that processes of decentralisation and sub‐urbanisation of distribution systems for b2c e‐commerce may gradually extend and shift, respectively, towards more remote and less densely populated areas in the Netherlands. This would reinforce the ongoing process of retail store closures in these areas, i.e., the spatial redistribution in retailing facilities, thus limiting physical accessibility. As a result, average trip lengths and car use for shopping trips may on the whole increase. With freight transport also increasing due to b2c e‐commerce, its overall long‐term effect may be an increase in motorised mobility, with urban consumers saving trips for shopping purposes and consumers elsewhere adding to their travel burden. Only certain products are feasible for e‐commerce, however. Hence, the impact of b2c e‐commerce on mobility and accessibility varies between product categories.

The effects of telecommuting and intelligent transportation systems on urban development

This study examines the state of knowledge on the effects of telecommuting and intelligent transportation systems on location decisions of households and businesses and it defines the policy and planning implications for metropolitan areas. The study suggests an increased trend toward multinucleated urban structure where a number of urban satellite nodes, containing mixed business and residential land uses are located at some distance from the central core and along transportation corridors.

Environmental Risk and Uncertainty: Insights from Yucca Mountain

Abstract This study examines the effects of the risk from transporting high–level radioactive waste to the proposed Yucca Mountain repository on housing location decisions in Southern Nevada. Using data from a survey of southern Nevada households, we develop a model–based subjective risk estimate for each household. We then explore different factors that may influence the household's location decisions if the proposed transportation route is ultimately chosen for nuclear waste transport. We extend the conventional expected utility model to allow for uncertainty surrounding the actual risks borne by the household. Finally, we examine the impact of federal government compensation on households’ location decisions. The findings indicate that residents currently living near the proposed transportation route express subjective risk estimates much larger than those reported by the Department of Energy. In general, households that are uncertain about the future risks are more likely to relocate than those expressing certainty. When everything is considered, the model predicts that between one and three percent of households living near the transportation route are likely to relocate. Compensation can influence some households to remain at their present location and bear the transport risk.

Modeling Agglomeration Forces in Urban Dynamics: A Multi-Agent System Approach

Urban dynamics is driven by the location decisions of firms and households. The preferences of households and firms for a certain location generally depend on the presence of other households or firms at the same location. In this paper, we propose and illustrate a multi-agent model that takes such agglomeration effects into account. In the model, the households or firms that are potentially interested in a candidate site for (redevelopment are individually represented as agents that can indicate their interest by making a bid. In compiling a proposal based on bids of individual agents, the model takes positive and negative synergies between agents into account. Planners and developers are also represented in the model as agents playing specific roles in the process. Simulations in the area of retailing demonstrate the model and show that agglomeration effects have an impact on generated proposals. It is argued that the model can be used as a location-decision component in dynamic multi-agent, land-use systems for simulation or planning support.