Cost economies, urban patterns and population density: The case of public infrastructure for basic utilities1. (17th January 2014)

• Record Type: Journal Article
• Authors: Prieto, Ángel M.; Zofío, José L.; Álvarez, Inmaculada
• Is Part Of: Papers in regional science. Volume 94:Number 4(2015:Nov.)
• Page Start: 795
• Page End: 816
• Publication Date: 2014-01-17
• Subjects: C3 -- D24 -- H1 -- H4 -- R53; Resource management -- regional governments -- cost economies -- population density -- translog cost function; Regional planning -- Periodicals; City planning -- Periodicals; Urbanization -- Periodicals; Economic geography -- Periodicals; 307.12
• DOI: 10.1111/pirs.12096
• Languages: English
• ISSNs: 1056-8190

Abstract

Abstract: Determination of optimal population densities underlies the economic rationality when planning the provision of basic public infrastructure by local governments. Using econometric techniques based on the translog cost function, we investigate the existence of economies of scale, associated to a larger urban size in terms of population and housing, determine the effect of alternative urban patterns – compact or dispersed – on the cost of provision, and calculate optimal population densities as targets for urban planning. We illustrate the practicality of our model using Spanish municipal data, and unveil latent economies of scale and suboptimal urban densities due to excessive dispersion. Based on these findings we propose specific policy guidelines in terms of desirable urban structures.