Strategic interactions of urban land developers in the housing market

This thesis studies the supply side of the housing market taking into account the strategic interactions that occur between urban land developers. The thesis starts by reviewing the literature on new housing supply, concluding that there are very few studies where strategic interactions are taken into account. Next, we develop a model with two urban land developers, who rst decide the quality of housing and then compete in prices, considering that the marginal production costs depend on the housing quality. First, we analyze the price competition game and characterize the Nash equilibrium of the price game. Finally, we examine the rst stage of the game and determine numerically the subgame perfect Nash equilibrium (SPNE) of the quality-price game. In the price competition game, our results show that the equilibrium price of an urban land developer is an increasing function of its own quality, while it is a non-monotonic function of the rival s quality. The behavior of the equilibrium pro ts reveals that, in general, urban land developers gain by di¤erentiating their quality. However, the urban land developer located at the Central Business District (CBD), may prefer to have the same quality than the rival when transportation costs are high by exploiting its locational advantage. The analysis of the rst stage of the game also reveals that, in general, the rms best response is to di¤erentiate their quality and that, in most cases, there are two subgame perfect Nash equilibria that involve quality di¤erentiation. However, the results depend on transportation costs and the quality valuation parameter. For small quality valuations, in equilibrium, the market is not fully covered and, if the unit transportation costs are high, only the urban land developers located at the CBD operates. For higher quality valuations, all the consumers are served. Furthermore, the equilibrium qualities and pro ts are increasing with quality valuation parameter. RESUMO: Esta tese estuda a oferta no mercado da habitação, tendo em conta as interações es- tratégicas que ocorrem entre os produtores de habitação. A tese revê a literatura sobre a oferta de habitação, concluindo que existem poucos estudos que tenham tido em conta as interações estratégicas. De seguida, desenvolvemos um modelo com dois produtores de habitação, que primeiro decidem a qualidade da habitação e depois competem em preços, considerando que os custos marginais de produção dependem da qualidade. Primeiro analisamos o jogo em preços e caracterizamos o equilíbrio de Nash. Posteriormente, ex- aminamos o primeiro estágio do jogo e determinamos numericamente o equilíbrio perfeito em todos os subjogos (SPNE) do jogo. No jogo de competição em preços, os resultados mostram que, o preço de equilíbrio, é uma função crescente da qualidade da habitação, sendo uma função não monótona da qualidade do rival. O lucro de equilíbrio revela que, geralmente, os produtores de habitação têm ganhos em diferenciar a qualidade. No entanto, o produtor localizado no Centro (CBD), pode preferir oferecer a mesma qualidade que o rival, caso os custos unitários de transporte sejam elevados, através da sua vantagem de localização. A análise do primeiro estágio do jogo, revela que, geralmente, a melhor resposta de um produtor é a de diferenciar a qualidade. Na maior parte dos casos existem dois SPNE que envolvem essa diferenciação. No entanto, os resultados dependem dos custos unitários de transporte e da valorização da qualidade por parte do consumidor. Para uma reduzida valorização da qualidade, em equilíbrio, o mercado não é totalmente coberto e, se o custo unitário de transporte é elevado, apenas o produtor localizado no CBD opera no mercado. Para uma valorização elevada da qualidade, todos os consumidores são servidos. Além disso, as qualidades e os lucros de equilíbrio são crescentes com a valorização da qualidade.

Transportation and spatial development : an overview and a future direction

THE INFLUENCE OF URBAN FORM AT DIFFERENT GEOGRAPHICAL SCALES ON TRAVEL BEHAVIOR; EVIDENCE FROM U.S. CITIES

Suburban lifestyle is popular among American families, although it has been criticized for encouraging automobile use through longer commutes, causing heavy traffic congestion, and destroying open spaces (Handy, 2005). It is a serious concern that people living in low-density suburban areas suffer from high automobile dependency and lower rates of daily physical activity, both of which result in social, environmental and health-related costs. In response to such concerns, researchers have investigated the inter-relationships between urban land-use pattern and travel behavior within the last few decades and suggested that land-use planning can play a significant role in changing travel behavior in the long-term. However, debates regarding the magnitude and efficiency of the effects of land-use on travel patterns have been contentious over the years. Changes in built-environment patterns is potentially considered a long-term panacea for automobile dependency and traffic congestion, despite some researchers arguing that the effects of land-use on travel behavior are minor, if any. It is still not clear why the estimated impact is different in urban areas and how effective a proposed land-use change/policy is in changing certain travel behavior. This knowledge gap has made it difficult for decision-makers to evaluate land-use plans and policies. In addition, little is known about the influence of the large-scale built environment. In the present dissertation, advanced spatial-statistical tools have been employed to better understand and analyze these impacts at different scales, along with analyzing transit-oriented development policy at both small and large scales. The objective of this research is to: (1) develop scalable and consistent measures of the overall physical form of metropolitan areas; (2) re-examine the effects of built-environment factors at different hierarchical scales on travel behavior, and, in particular, on vehicle miles traveled (VMT) and car ownership; and (3) investigate the effects of transit-oriented development on travel behavior. The findings show that changes in built-environment at both local and regional levels could be very influential in changing travel behavior. Specifically, the promotion of compact, mixed-use built environment with well-connected street networks reduces VMT and car ownership, resulting in less traffic congestion, air pollution, and energy consumption.

Quantifying the Resilience of an Urban Traffic-Electric Power Coupled System

Transportation system resilience has been the subject of several recent studies. To assess the resilience of a transportation network, however, it is essential to model its interactions with and reliance on other lifelines. In this work, a bi-level, mixed-integer, stochastic program is presented for quantifying the resilience of a coupled traffic-power network under a host of potential natural or anthropogenic hazard-impact scenarios. A two-layer network representation is employed that includes details of both systems. Interdependencies between the urban traffic and electric power distribution systems are captured through linking variables and logical constraints. The modeling approach was applied on a case study developed on a portion of the signalized traffic-power distribution system in southern Minneapolis. The results of the case study show the importance of explicitly considering interdependencies between critical infrastructures in transportation resilience estimation. The results also provide insights on lifeline performance from an alternative power perspective.

Air pollution levels measured at traffic hot spots : Brisbane urban corridor study

Air pollution levels were monitored continuously over a period of 4 weeks at four sampling sites along a busy urban corridor in Brisbane. The selected sites were representative of industrial and residential types of urban environment affected by vehicular traffic emissions. The concentration levels of submicrometer particle number, PM2.5, PM10, CO, and NOx were measured 5-10 meters from the road. Meteorological parameters and traffic flow rates were also monitored. The data were analysed in terms of the relationship between monitored pollutants and existing ambient air quality standards. The results indicate that the concentration levels of all pollutants exceeded the ambient air background levels, in certain cases by up to an order of magnitude. While the 24-hr average concentration levels did not exceed the standard, estimates for the annual averages were close to, or even higher than the annual standard levels.

How can land and urban development make houses healthier?

Traditionally, the main focus of the professional community involved with indoor air quality has been indoor pollution sources, preventing or reducing their emissions, as well as lowering the impact of the sources by replacing the polluted indoor air with "fresh" outdoor air. However, urban outdoor air cannot often be considered "fresh", as it contains high concentrations of pollutants emitted from motor vehicles - the main outdoor pollution sources in cities. Evidence from epidemiological studies conducted worldwide demonstrates that outdoor air quality has considerable effects on human health, despite the fact that people spend the majority of their time indoors. This is because pollution from outdoors penetrates indoors and becomes a major constituent of indoor pollution. Urban land and transport development has significant impact on the overall air quality of the urban airshed as well as the pollution concentration in the vicinity of high-density traffic areas. Therefore, an overall improvement in indoor air quality would be achieved by lowering urban airshed pollution, as well as by lowering the impact of the hot spots on indoor air. This paper explores the elements of urban land and vehicle transport developments, their impact on global and local air quality, and how the science of outdoor pollution generation and transport in the air could be utilized in urban development towards lowering indoor air pollution.