The urban transportation technology of the 19th century is incorporated in four assumptions underlying the monocentric model(O'Sullivan, 2003. Ch. 8)[1]:

  • Central export node (i.e. railroad terminal)
  • Clean Streets (ie. no trash on streets)
  • Hub and spoke streetcar system
  • Agglomeration economies

This model also assumes: nothing except commuting cost varies. In reality this is not the case. There are variations in public goods, facilities, environmental quality, taxes, and amenities(O'Sullivan, 2003. Ch. 8)[1].

Bid Rent Theory in Monocentric ModelEdit

How much a firm is willing to pay for a land depends on how far the land is from the railroad terminal. A firm will be forced by competition from other firms to pay a certain price. As we move away from the central export node, freight costs increase, decreasing the amount a firm is willing to pay for a land(O'Sullivan, 2003. Ch. 8)[1].

Land Use Spatial Arrangement Features of Monocentric CityEdit

The spatial arrangement features(O'Sullivan, 2003. Ch. 8)[1]:

  • Office firms occupy the central area of the CBD
  • Employment is concentrated in the CBD, not distributed throughout the city.

The firm's location decision is determined by the outcome of a tug of war between central export node and the suburban workforce. In the monocentric city, the tug of war was won by the CBD because the cost of moving freight was large relative to the cost of moving workers (at that time is horse drawn wagon, which is slow and expensive, while workers travel with streetcar which is fast and inexpensive). So the wage difference between suburbs is not so much different(O'Sullivan, 2003. Ch. 8)[1].


  1. 1.0 1.1 1.2 1.3 1.4 O'Sullivan, Arthur. (2003) Urban economics (McGraw-Hill/Irwin, Boston)
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