Urban Economics and Policy
We are at the first point in history where over half of the world population lives in cities, and urbanization is only expected to grow with time: as high as 70% of the population by 2050. Any study of the policy approaches to improving the quality of life therefore ought to consider the role of cities in economic development and human welfare. The importance of cities is something of a puzzle to economics: why would someone move to one given their many disadvantages: traffic, crime, pollution and a high cost of living? The answer to this puzzle must lie in something about the role of proximity in economic and social welfare. Part of the usefulness of economics in this context is its ability to relate outcomes that are determined simultaneously in proximate markets: for example the interaction of outcomes in school districts with those in nearby housing markets. This course tries to unpack these relationships by applying the tools of microeconomics to explore how urban economies work and the effects of policy on their outcomes. The approaches and topics in the course will be relevant for those expecting to work in urban policy or politics in the US and internationally. We will discuss the effects of policies to address crime, local economic development, inequality, and pollution. Finally we will try to understand important factors that affect cities in developing and emerging market countries such as informal housing, infrastructure development and the effects of pollution on health.