GY210      Half Unit
The Economics of Cities

This information is for the 2018/19 session.

Teacher responsible

Prof John Henderson STC.S506b


This course is compulsory on the BSc in Geography with Economics. This course is available on the BA in Geography, BSc in Economic History and Geography, BSc in Economics, BSc in Environment and Development and BSc in Environmental Policy with Economics. This course is available as an outside option to students on other programmes where regulations permit and to General Course students.


Economics A (EC100) or Economics B (EC102). ST107 (or equivalent course in statistics) strongly recommended.

Course content

Urban economics is concerned with the spatial form of cities and the division of national economic activity into cities, both at a point in time and over time.  Three fundamental questions are: (1) Why are economic activities within a country so unequally distributed across space? (2) Why do cities (and more broadly agglomeration of firms and workers) emerge and in what locations? (3) Why are economic activities within cities unequally distributed in general and between areas near the city centre and those near or in the suburbs? 

The main topics covered include:

Why do cities exist and why do firms cluster? Diseconomies in cities: Urban location, land rents, and land use patterns? What determines equilibrium city size and features of the urban system? City growth, location, and spatial transformation Land use regulation.


18 hours of lectures and 9 hours of classes in the LT. 1 hour of classes in the ST.

Students on this course will have a reading week in Week 6.

Formative coursework

Students will be expected to prepare for group discussion of some readings and hand in short essays or problem sets.

Indicative reading

O’Sullivan. A. (8th edition) Urban Economics. Boston: Irwin- McGraw-Hill, 2012.

Greenstone M. R. Hornbeck and E. Moretti (2010), “Identifying agglomeration economies: Evidence from winners and losers of large plant openings”, Journal of Political Economy, Vol. 118, No. 3, 536-598.

Linden L and J.E. Rockoff, (2008) “Estimates of the Impact of Crime Rates on Property Values from Megan’s Law,” American Economic Review, 98, 1103-1127.

Eid, Jean & Overman, Henry G. & Puga, Diego & Turner, Matthew A. (2008), “Fat city: Questioning the relationship between urban sprawl and obesity”, Journal of Urban Economics, Vol. 63, No.2, 385-404.

Duranton G. (2008), “Viewpoint: From cities to productivity and growth in developing countries”, Canadian Journal of Economics, Vol. 41, No. 3, 689-736, Sections 1, 2.1, 2.2, 2.3.3, 2.3.4, 2.4, 3.1, 3.2.

Henderson J.V. (2010), “Cities and development”, Journal of Regional Science, Vol. 50, No. 1, 515-540.

Henderson J.V., T. Regan and A.J. Venables (2016) “Building functional cities” Science 20 May 2016

Collin M. (2014)  “The price of empowerment: Experimental evidence on land titling in Tanzania”  Centre for Global Development WP #369


Exam (50%, duration: 1 hour and 30 minutes) in the summer exam period.
Essay (20%, 1000 words) and other (30%) in the LT.

Key facts

Department: Geography & Environment

Total students 2017/18: Unavailable

Average class size 2017/18: Unavailable

Capped 2017/18: No

Value: Half Unit

Guidelines for interpreting course guide information

PDAM skills

  • Problem solving
  • Application of information skills
  • Application of numeracy skills