A PRACTICAL LOCATION EQUILIBRIUM MODEL TO STUDY MEASURES PROMOTING COMPACT CITY POLICY

Abstract

This paper develops a theoretical and a practical location equilibrium model to apply to the study of measures promoting compact city policy. The theoretical model is extended to a time series model of housing and, aiming for higher accuracy of the estimation, assumes that households classified by the age of household heads are the locational subjects, and that the moving demand is endogenously determined. The practical model uses the data of the year of 2000 in Toyama Area divided 979 zones to estimate the parameters and verifies good reproducibility of the model at the time of 2005 and 2010. As a result of the numerical simulation considering two measures promoting compact city policy, which are rent subsi-dy and supermarket installation, using the practical model, population increase in expected zones and the improvement of access are verified. In addition, it is indicated that the administrative costs necessary for the above two measures equivalent to about 0.3% of the annual expenditure of the local government.