Commuting patterns and Firm Decentralization.pptVIP

Commuting patterns and Firm Decentralization Introduction This paper written by Robin Dubin exams commuting patterns of employed individuals and firm decentralization by testing the monocentric model. By examining the monocentric model, the paper will show us how sex, income, race, household responsibilities, residential and job mobility determine commuting behavior as firms decentralize. Monocentric model Most employed individuals must travel between home and work on a daily basis, work place commuting thus has provided the point of departure for the monocentric model of residential location. In the monocentric situation, all employment is located at the central business district; decentralized firm location enables workers to shorten their commutes as firms have left the central business district, to move into the residential area. One of the major behavioral assumptions of the monocetric model is that comsumers prefer less commuting to more. Hence the model predicts that workers will take advantage of firm decentralization. Assumption (a) The employees are willing to move in order to be near the new suburban location (people prefer less commuting) (b) The firm’s employees are located in one portion of the city so that the firm can locate nearer to them by suburbanizing; (c) the firm can change employees and thereby employ people who live near the new location. Discussion Suppose homogeneous jobs, workers and housing,all employment is located in the central business district. If a firm suburbanized, in the very short run, total commuting in the city will increase. But two adjustments reduce commuting: workers can follow the firm, and the company can hire new workers that live near the new location. Commuting will reduce eventually. More realistically, workers differ by incomes, preferences or training; Jobs differ by skill requirements, and the housing stock is not homogeneous. Workers are not indifferent among all residentia