The Energy Implications of City Size and Density

33 Pages Posted: 17 May 2014

See all articles by William D. Larson

William D. Larson

Federal Housing Finance Agency

Anthony M. Yezer

George Washington University - Department of Economics

Date Written: April 2, 2014

Abstract

This paper develops the first urban simulation model with endogenous population, housing supply and demand, and highway use and congestion. These features allow the model to simulate cities of different sizes with a single parameterization and hence to study the partial effect of city size differences on economic activity. The model is applied to the important problem of the energy implications of city size and density. Energy consumption in housing and commuting is calculated based on the structure type and size of housing units, consumption of a numeraire good, and commuting distances and velocities on congested roadways. The surprising conclusion is that per capita energy consumption does not vary as city size increases. Households in larger cities consume less housing, commute longer (and slower) and consume more of the numeraire good. The energy use implications of these effects are offsetting for a laissez-faire city. However, common land use policies can positively or negatively affect both city welfare and the elasticity of energy use with respect to city size.

Keywords: urban simulation, congestion, commuting, gasoline, greenbelt

JEL Classification: Q40, R14

Suggested Citation

Larson, William D. and Yezer, Anthony M., The Energy Implications of City Size and Density (April 2, 2014). Available at SSRN: https://ssrn.com/abstract=2437647 or http://dx.doi.org/10.2139/ssrn.2437647

William D. Larson (Contact Author)

Federal Housing Finance Agency ( email )

400 7th Street SW
Washington, DC 20552
United States

Anthony M. Yezer

George Washington University - Department of Economics ( email )

Monroe Hall, Suite 340
2115 G Street, NW
Washington, DC 20052
United States

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