GY210 Half Unit
The Economics of Cities
This information is for the 2025/26 session.
Course Convenor
Prof Henry Overman
Availability
This course is compulsory on the BSc in Economic History and Geography and BSc in Geography with Economics. This course is available on the BA in Geography, BSc in Economics, BSc in Environment and Sustainable Development, BSc in Environment and Sustainable Development with Economics, BSc in Environmental Policy with Economics, Erasmus Reciprocal Programme of Study and Exchange Programme for Students from University of California, Berkeley. This course is freely available as an outside option to students on other programmes where regulations permit. It does not require permission. This course is freely available to General Course students. It does not require permission.
This course is capped at 80 students.
Requisites
Additional requisites:
Microeconomics I (EC1A1 or EC1A3 or EC1A5) in combination with Macroeconomics I (EC1B1 or EC1B3 or EC1B5), and 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 agglomerations of firms and workers) emerge and in what locations? (3) How and why are economic activities within cities unequally distributed in general and between the city centre and the suburbs?
The main topics covered in this course include:
- Why do cities exist and why do firms cluster?
- What determines equilibrium city size and features of the urban system?
- City growth and spatial transformation
- Diseconomies in cities: Urban location, land rents and land use patterns
- The role of local governments
Teaching
7 hours of classes and 18 hours of lectures in the Winter Term.
This course has a reading week in Week 6 of Winter Term.
In the Department of Geography and Environment, teaching will be delivered through a combination of classes/seminars, pre-recorded lectures, live online lectures and other supplementary interactive live activities.
Formative assessment
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., Urban Economics. Boston: Irwin- McGraw-Hill, 9th Edition, 2019.
- Greenstone M. R. Hornbeck & 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.
- Duranton, G. & Puga, D. (2001). Nursery cities: Urban diversity, process innovation, and the life cycle of products. American Economic Review, 91(5).
- Ahlfeldt, G. M., & McMillen, D. P. (2018). Tall buildings and land values: Height and construction cost elasticities in Chicago, 1870–2010. Review of Economics and Statistics, 100(5), 861-875.
- Hilber, C. A., & Vermeulen, W. (2016). The impact of supply constraints on house prices in England. The Economic Journal, 126(591), 358-405.
- Hilber, C.A.L. & Lyytikäinen, T. (2017). Transfer Taxes and Household Mobility: Distortion on the Housing or Labor Market? Journal of Urban Economics 101, 57-73.
Assessment
Exam (100%), duration: 120 Minutes in the Spring exam period
Key facts
Department: Geography and Environment
Course Study Period: Winter Term
Unit value: Half unit
FHEQ Level: Level 5
CEFR Level: Null
Total students 2024/25: 78
Average class size 2024/25: 13
Capped 2024/25: Yes(105)Course selection videos
Some departments have produced short videos to introduce their courses. Please refer to the course selection videos index page for further information.
Personal development skills
- Problem solving
- Application of information skills
- Communication
- Application of numeracy skills