ancient cities

868 Urban Entertainment Destination
different from the legal burden. In addition, local
governments respond to intergovernmental grants
by cutting taxes and shifting resources to other
programs. This response is consistent with voter
preferences and means that part of a grant is spent
on other public and private goods.
Urban Housing
Urban economics explores the unique features of
the urban housing market and evaluates the
merits of various housing policies. Housing is
different from other products because it is heterogeneous
(i.e., dwellings differ in size, age,
design, and location) and durable. Moreover, a
household faces substantial costs in moving
from one house to another. The hedonic approach
is based on the notion that given the heterogeneity
of housing, the price of a particular dwelling
can be decomposed into implicit prices for attributes
such as size, age, and accessibility to urban
activities such as schools, parks, and churches.
Hedonic studies estimate these implicit prices,
for example, the change in house value for an
additional bedroom or a one-block move closer
to a park or a noxious facility.
The filtering model of the housing market
explores the economic forces that cause dwellings
to move down the quality ladder to households
with progressively lower income. This has
important implications for housing policy
because it is typically more economical to accommodate
low-income households in existing housing
than in new construction. Urban economics
explores the trade-offs associated with housing
policies designed to help low-income households,
including public housing, subsidies for
private housing, and housing vouchers issued to
low-income households.
Conclusion
Urban economics lies at the intersection of geography
and economics, addressing the question of where
economic activity occurs. It shows how the decisions
of utility-maximizing households and profit-maximizing
firms lead to the development of cities of
varying size, scope, and spatial structure. The field
also applies economic analysis to urban problems,
such as poverty, crime, congestion, and dysfunctional
neighborhoods, and explores the role of local government
in a federal system of government.
Arthur O’Sullivan
See also Disinvestment; Housing; Local Government;
Urban Policy; Urban Theory
Further Readings
Fujita, Masahisa. 1991. Economic Theory: Land Use and
City Size. Cambridge, UK: Cambridge University
Press.
Henderson, J. Vernon. 1985. Economic Theory and the
Cities. 2nd ed. Orlando, FL: Academic Press.
Mills, Edwin. 1972. Studies in the Structure of the
Urban Economy. Baltimore: Johns Hopkins
University Press.
Mills, Edwin S. and Bruce Hamilton. 1997. Urban
Economics. 5th ed. New York: Addison-Wesley.
O’Flaherty, Brendan. 2005. City Economics. Cambridge,
MA: Harvard University Press.
O’Sullivan, Arthur. 2007. Urban Economics. 6th ed.
New York: McGraw-Hill/Irwin.
Thisse, Jacques-François and Masahisa Fujita. 2001.
Economics of Agglomeration: Cities, Industrial
Location, and Regional Growth. Cambridge, UK:
Cambridge University Press.
Ur b a n en t e r t a i n m e n t
De s t i n a t i o n
During the mid-to-late 1990s, the urban entertainment
destination was widely promoted in the
commercial real estate industry as the next big
thing. The term was introduced in 1994–1995 in
Urban Land, the flagship publication of the Urban
Land Institute, a lobby and educational group
supportive of the land development industry.
Urban entertainment destinations are defined as
mixed-use projects that feature megaplex cinemas,
sports arenas and stadiums, casinos, themed restaurants,
high-tech video arcades, and the like, as
anchors for massive retail–leisure complexes. As
such, they constitute the building blocks of the
theme park or fantasy city.
Urban entertainment destinations are typically
conceived as public–private partnerships of a