City affordability and residential location choice: A demonstration using agent based model

Who lives where and why? – is a prominent issue studied in the field of urban economics. With urbanization on rise, housing transportation policies must strive to strike balance between accessibility affordability. The study builds an economic rational agent-based model, for hypothetical monocentric city, simulate pattern that emerges from households' residential location choice as they aim minimize their expenditure rent commute under different scenarios. model highlights significance costs spatial policy tool shaping growth. By manipulating these costs, cities can promote compactness, increase affordability, result more homogeneous density income distribution pattern. also finds mode travel plays crucial role determining choice, with private users tending reside city's inner areas public opting outer areas. However, when heavily subsidized, this reversed. We find inequality plot size variability lead income-based segregation city. Our findings, validated through review relevant empirical literature, provide valuable directions into underlying mechanisms shape growth