Contact Us
Sign In / Sign Up for FREE
Go to advanced search...

Theories of rent and urban economics - Essay Example

Comments (0) Cite this document
This paper presents an essay drawn on the theories of rent and urban economies. The theories explain in detail the patterns in office rent shown in the Colliers UK Office Rent Map. The first section covers the theory of neighborhood. …
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER96.6% of users find it useful
Theories of rent and urban economics
Read Text Preview

Extract of sample "Theories of rent and urban economics"

Download file to see previous pages The essay further outlines Smith’s rent gap theory and the agricultural land theory. The analysis is followed by an outline of the agent based land market model, and the microeconomic theory. The paper winds up with the central place theory and a conclusive remark on the varied rental patterns in an urban setting. The Collier Map show that there are different rent patterns for urban areas in UK and London in particular. The Western part of London records a mixture of rent patterns with a lower level of 10 pounds, and a higher level of 34pounds. The South East London has a rental pattern that way near similar with the difference between the highest and the lowest; levels being minimal (16-24 pounds). The same scenario applies to the North West and Yorkshire which has one of the lowest/cheapest rental rates. The outskirts of London and the hinterland towns have a low level of rent rates compared with the metropolitan. However, there are some urban areas outside the London Metropolitan which have higher rental patterns. A good example is Dublin with a high of 35 pounds. Urban economics is the study of economies that are organized as urban areas (Harvey and Jowsey, 2003). It also studies the cities which are the modern centre of culture, innovation and education. It is in the urban centers where major commercial activities takes place hence the aspect of many offices being located in the urban areas (MacDonald & McMillen, 2007). Urban economics is closely related to the field of real estate and rental properties. Rent is the amount paid by a tenant to a landlord on a rented or leased space. Many theories exist in the field of urban economics and real estate. They are outlined below; The Neighborhood Theory The first theory is based on the housing prices, neighborhood characteristics, and racial segregation. This theory stipulates that the price of an office premise is determined by the characteristics of the neighborhood as well as the characteristics of the house. These neighborhood factors directly influences the patterns of office rent in given urban areas. Neighborhood variable affect the pattern of office rent either positively or in a negative way. These two factors combine to determine the pattern of rent in a given section of an urban area. They include; crime rate in an area, property tax rate, economic strength of the neighborhood, air pollution, accessibility from nearest train/ bus stations, extent of traffic on the street as well as quality of education/ number of institutions of learning (McDonald & McMillen, 2007). This explains the different office rent patterns in an area like Cambridge which is an educational centre and Nottingham. There has been an increase in the quality of office buildings in some sections of urban areas. This results in changes in office rent patterns. Areas with good quality buildings have different office rent patterns with areas with low quality office buildings. The same case applies to areas with different races. There is a tendency for rental patterns to be high in areas populated by the whites, as opposed to areas with a mixture of races (King and Mieszkoski, 1973). This theory explains the difference rental patterns in the London Metropolitan. Areas such as Wimbledon (?30) and Heathrow (?28) with good quality houses have higher rental patterns as compared with those with low quality such as Norwich (?15). Natural Evolution Theory Natural evolution theory is a model which was advanced by Mieszkowski and Mills (1993). They argue that the filtering model provides a primary reason for the movement and relocation of offices in the suburbs. The result is the emergence of suburbs which acts as commercial centers, characterize by high and ...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
(“Theories of rent and urban economics Essay Example | Topics and Well Written Essays - 2500 words”, n.d.)
Retrieved de
(Theories of Rent and Urban Economics Essay Example | Topics and Well Written Essays - 2500 Words)
“Theories of Rent and Urban Economics Essay Example | Topics and Well Written Essays - 2500 Words”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Theories of rent and urban economics

International Business Economics

According to Adam Smith, the absolute advantage would be realised as long as the cost of production differed from between countries, one or both countries would gain by trading. An example to illustrate this is a situation where we have two countries A and B which produce two similar goods X and Y. The figures show labour cost in hours for producing one unit of a good

David Ricardo formulated the theory of comparative advantage and argued that even if one country is more productive in both lines of production it would be still profitable to trade. Country A is more productive in both lines of production but it will still be profitable to trade with country B, this is shown by first stating that country A is more advanta...
6 Pages (1500 words) Assignment

Human Performance: Theories and Principles of Motivation

I have been assigned two HRM consultants who are busy designing the motivation questionnaire to be administered to all the group employees. However, this also gave me an opportunity to reflect over my personal strengths and weaknesses as I would soon have the most responsible task of convincing the top management about the contents of the questionnaire and the finalization of motivation report and its possible uses in the group in the formulation of exact policies and tactics to improve employee morale. My immediate boss gave me this entire assignment breaking the line structure and formalized it by getting it ratified by the board. He also built an incentive and bonus deal for me to be awarded on the successful completion of the...
12 Pages (3000 words) Case Study

Organizational Analysis from the Perspectives of Organizational Learning, Psychodynamics, and Complexity Theories

Transform the vision into people and you have an organization.
Organizations are groups of people coming together for a certain purpose – whether it is dictated by blood, law, social affiliation, common interests or whatever reason that brings people together. What makes this “mix” of people rich is the variety of personal psychodynamics each member brings in. By Psychodynamics, I mean individual personalities, family dynamics, social network and other personal issues.

Although a group develops its own culture, as Wilfred Bion, a renowned psychoanalyst has thoroughly worked on, it is not immune to the surfacing of its members’ individual psychodynamics every so often. This usually creates te...
9 Pages (2250 words) Essay

Business Economics: Small and Medium

The entry of small firms into the global markets has proven to be the main aspect of the creation of economies of scale. Markets are fast evolving to the needs of varied tastes and customer preferences, so necessary knowledge and technology asset has a major role to play for small firms to rise and to match up to the situation. However, small firms are characterized by “smallness of the market share (a large number of similar-sized firms) and hence lack of individual market power, corresponding to the theoretical concept of Pure Competition.” (Waite 1973. P. 154).

They need to overcome the handicap of smallness by strategic alliances and mergers with larger or technically more competent entities. Small firms...
10 Pages (2500 words) Assignment

Issues in Applied Economics

A major issue then, becomes the convincing obligation by the polity not to abuse its force. Because institutions are planned by people with different bargaining powers and not for sake of effectiveness, some models may be less competent than others and due to path dependency, may continue for a long time, resulting in sluggish economy. The shortage of realistic commitment by the state not to suitable property human rights accounts for the incompetent institutions that have developed in different countries. To humor, such situation provides disincentives to investment in socially profitable enterprises, and generates groups with vested interests in preserving the status quo constraints.

Institutions present the fundament...
6 Pages (1500 words) Term Paper

The Philosophy and Theories of John Locke

The ‘state of nature’ according to social contract theory describes the hypothetical condition of humanity before the state’s foundation and its monopoly on the legitimate use of physical force (Wikipedia). The 17th and 18th-century thinkers believed that whatever good things one had in the ‘state of nature’ should not be lost when one entered into society. They even evaluated the government based on this condition. The citizens of New Orleans like everyone else had been living in the ‘state of nature’ and hence their sentiments and revolt against the government is natural when their expectations have not been met. Locke believed that in the state of nature, men mostly kept their promises....
6 Pages (1500 words) Term Paper

Porter nd Kotler's Theories

UK consumers аre the biggest spenders per cаpitа on clothing in the EU. While the import аnd export mаrket increаsed over the yeаrs, locаl production fell rаpidly by аpproximаtely 1 bn pounds. Аs а result of these figures it is obvious thаt the British fаshion industry is highly dependent on other countries’ textile.

А lаrge number of British consumers hаve becаme more price-sensitive under the slogаn ‘look good-pаy less’ however some consumers аre willing to buy higher-priced аnd exclusive clothing. The number of millionаires in the UK increаsed by more thаn 80% between 2001(230000) аnd 2004(425000) (Finch, 2007). This leаds to luxury аnd strong brаnd аwаreness. Аlthough the formаl weаr is more аnd mo...
10 Pages (2500 words) Case Study

Economics or Ethics

Several CEOs in America have in coalition with top managers deviated from the norms of corporate governance and caused immeasurable woes to the stakeholders. Using their power and ego they chased the wealth for personal gains without any concern for the shareholders or other stakeholders of the company. Enron, the world’s largest energy trader at one time, had to file bankruptcy under Chapter 11 when about 5000 workers lost their job (Bhattacharya, 2004). Arthur Anderson, one of the big five auditing firms was charged to have colluded with the management to misappropriate funds and project a picture different from the reality. Income was inflated and then all concerned papers were destroyed. The leadership at Enron was conce...
6 Pages (1500 words) Assignment

Managerial Economics and Business Environment

Once the above said subject matter is clearly sorted out, the next emphasis would be on the concepts like the opportunity costing, incremental principle, marginal principle, discounting principle, the principle of time perspective, and calculation of economic profit as the guidelines to the scope of managerial economics. (Surender. V, 2008).
To start with, we consider a firm for which different processes have to be carried to achieve its objectives of profit maximization (assuming that all the organizations work with the view to maximize profits). If firms from different sectors are identified simultaneously, then the working of the economy as a whole could also be analyzed which in turn is useful in the decision-making proce...
15 Pages (3750 words) Assignment

Traditional Theories of Leadership

They now focus more on doing things whilst thinking about the times that will follow; building upon their strengths and aiming to address the grey areas. The eventual emphasis within the modern theories of leadership has been centered on the premise of bringing about a change that remains abreast of the times that will come ahead (Lynch, 2006). Changing the dynamic mindset of the organizational processes and behaviors is a significant undertaking and this has rightly been pointed out by these modern theories under the leadership tenet. The visionary role of leadership has made things easier, focused on the long term actions and sought clarification from the goal setting and objectives’ regimes (Zaleznik, 1989). The new theor...
6 Pages (1500 words) Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic Theories of rent and urban economics for FREE!

Contact Us