Monocentric Model Version en Cours

N. Coulombel 1/29 WORKING PAPER A Monocentric Analysis of Housing Budget Restrictions, Including and Without Transportation a Nicolas Coulombel a Université Paris-Est, Laboratoire Ville Mobilité Transport, 19 rue Alfred Nobel, Cité Descartes – Champs sur Marne, F-77455 Marne la Vallée Cedex 2, FRANCE Contact Information for the Corresponding Author: E-mail: nicolas.coulombel@enpc.fr Tel: (+33) 1 64 15 21 30 Fax : (+33) 1 64 15 21 40 Paper Information: Word Count: 5067 words + 9 Figures Corresponding Author: Nicolas Coulombel A Monocentric Analysis of Housing Budget Restrictions, 2008, Working Paper Including and Without Transportation N. Coulombel 2/29 ABSTRACT Considering the last surge in fuel prices, the policy to limit the share of housing expenses in the households’ budget, so as to secure their solvency, has been criticized. Supposedly, it induces people to get farther from the city center in search of cheaper housing prices, but with subsequent increased transportation costs that are often disregarded during the house search process. To address this issue, several researchers have advocated to set a constraint on the share of both housing and transportation expenditure. The present paper analyzes and compares the effects of the two policies on the main features of the city and on the households’ utility. The analysis is carried out within the classical monocentric model of urban economics. After a general ...