Comparative Statics Analysis of Urban Land Values in the Presence of Government Regulation

Abstract

The paper undertakes comparative statics of urban land values in the presence of government regulation of density or rent in the central city or at the periphery. The principal finding is that the conclusions of Wheaton (1974) regarding the flattening of the rent curve due to a rise in income or its steepening following an increase in transport cost need not always hold in the presence of such regulation. Results of the comparative statics are used to derive practical implications for individual real estate investors and for urban planning.