TESTS OF THE STANDARD URBAN MODEL: A Micro (Trade-Off) Alternative

Three methods of testing the validity of the monocentric model (the negative house price gradient, the wasteful commuting approach, and the hypothesis of a trade-off between housing expenditures and commuting costs) are evaluated. The negative house price gradient is not supported by several recent hedonic models. "Wasteful" commuting is a poor test because it persists even a policentric world and may be more the result of the weakness of journey-to-work minimization as a key determinant of residence and/or workplace location. This study uses the commuting information presented in the 1985 American Housing Survey in eight large metropolitan areas to show that the trade-off hypothesis fails badly. Heterogeneous Preference for housing, commuting and indeed for all goods and services, combined with a wide variety of workplaces and choice of residential locations at highly, variable rents and house prices may be the major reason why the trade-off is not generally observed.