Endogeneity in Residential Location Models

The development of models to understand the behavior of an Urban Transportation System (UTS) as a whole is crucial, not only for the evaluation and exploration of policies to manage the level of pollution and congestion in the cities, but also for solving problems such as the efficient provision of utilities, infrastructure and schools. UTS can be viewed as the result of the interaction of many regulated and deregulated markets, or subsystems, where different agents participate in diverse time and spatial horizons. The usual approach to manage this complexity corresponds to the division of the problem in many interrelated subsystems or stages that form the demand and the supply of this market. Figure 1: UTS Modeling Stages