Regional Science and Urban Economics 81 (2020) 103484

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Regional Science and Urban Economics

journal homepage: www.elsevier.com/locate/regec

Self-driving cars and the city: Effects on sprawl, energy consumption, and
housing affordability☆
William Larson a, ∗ ,1 , Weihua Zhao b
a
Federal Housing Finance Agency, United States
b
University of Louisville, United States

A R T I C L E I N F O A B S T R A C T

JEL classification: We adapt the classic monocentric city model to consider three main topics related to the possible widespread
R11 adoption of autonomous vehicles (AVs): sprawl, energy consumption, and housing affordability. AVs are modeled
R28 to reduce marginal commuting costs and in some cases, reduce demand for center-city and residential parking.
C60
This creates opposing forces that lead to sprawl in some models and increasing density in others. All models
point to welfare increases, but also increases to energy consumption due to longer commutes, greater traffic
Keywords: congestion, and higher productivity, calling into question claims that autonomous vehicles will save energy.
Autonomous vehicle In most models, AVs lead to greater housing affordability by making suburban areas more accessible, and by
Transportation
reclaiming land that was previously used for parking. Effects of AVs on cities are substantial and depend on the
Energy consumption
manner in which this new technology is implemented.
Land use

1. Introduction
A new technology is under development that has the potential to
reshape the city–the autonomous vehicle (AV).2 Passengers in these
vehicles, freed from the need to attend to driving, are likely to face
dramatically lower fixed and marginal costs of commuting. These cost
reductions are due to greater leisure possibilities while commuting,
reduced collision risk,3 greater fuel efficiency through more optimal
acceleration and breaking,4 greater road throughput,5 and higher auto-
mobile utilization rates through car sharing networks such as those pio-
neered by Uber and Lyft.6
However, unlike other recent transportation innovations such as
telework or electric vehicles, which simply reduce marginal transporta-
tion costs, AVs have a secondary benefit—they reduce the need for com-

☆
The views expressed in this paper are solely those of the authors and not necessarily those of the Federal Housing Finance Agency or the U.S. Government. The
authors declare that they have no relevant or material financial interests that relate to the research described in this paper.
∗
Corresponding author. Federal Housing Finance Agency, Constitution Center, 400 7th St SW, Washington DC, 20024, United States.
E-mail address: larsonwd@gmail.com (W. Larson).
1
Larson contributed to this research in his personal capacity and not as part of his official duties at the Federal Housing Finance Agency. The analysis and
conclusions are those of the authors alone and should not be represented or interpreted as conveying an official Federal Housing Finance Agency position, policy,
analysis, opinion or endorsement. Any errors or omissions are the sole responsibility of the authors.
2 We define an autonomous vehicle as the U.S. National Highway Traffic Safety Administration’s (2013) Preliminary Statement of Policy Concerning Automated

Vehicles definition of a Level 4 Autonomous Vehicle: “The vehicle is designed to perform all safety-critical driving functions and monitor roadway conditions for an
entire trip. Such a design anticipates that the driver will provide destination or navigation input, but is not expected to be available for control at any time during
the trip. This includes both occupied and unoccupied vehicles. By design, safe operation rests solely on the automated vehicle system.”
3
Blincoe et al. (2002), in a National Highway Traffic Safety Administration (NHTSA) report, estimate the costs of traffic collisions to be $230 billion in 2000.
KPMG (2015) estimates that 80% of all traffic collisions could be eliminated through widespread adoption of AVs.
4
A RAND Corporation (2016) report cites research suggesting AVs can increase fuel economy by 4–10% through more optimal acceleration and deceleration.
5
AVs are shown in traffic simulations to increase throughput by upwards of 500% (Fernandes and Nunes, 2012), and total vehicle miles travelled (VMT) by 35%
(Bierstedt et al., 2014). Shoup (2005) finds that nearly half of all congestion delays are caused by crashes, which AVs would reduce.
6 Santi et al. (2014) estimates that the New York City taxi fleet could be cut by 40% or more with ride sharing. Were an AV used in a commute to be re-purposed

to an autonomous taxi during the workday, both the number of vehicles and the number of parking spaces could be presumably reduced.

https://doi.org/10.1016/j.regsciurbeco.2019.103484
Received 17 November 2018; Received in revised form 9 August 2019; Accepted 8 October 2019
Available online 23 December 2019
0166-0462/Published by Elsevier B.V.
W. Larson, W. Zhao
muter parking, freeing up land for other uses.7 According to estimates
in Meyer et al. (1965) and Shoup (2005), parking typically occupies
between 20% and 40% of all land in center-cities in the U.S., and large
amounts in residential districts elsewhere in the city. With widespread
adoption of AVs, cities and households may choose to reduce or elimi-
nate most CBD commuter parking as car sharing and automated parking
becomes ubiquitous.
There has been intense research on the subject of AVs across a vari-
ety of disciplines, including engineering, urban planning, and urban
economics. As outlined above, researchers have made great strides
in understanding the technical aspects of AV cars and their perfor-
mance. However, it is much more difficult to apply partial-equilibrium
approaches to the general equilibrium of cities in which location of res-
idences and patterns of land use change in response to this new tech-
nology.
In order to address questions of a general equilibrium nature, we
adapt the standard monocentric city model of Alonso (1964), Mills
(1967), and Muth (1969). This model focuses on firm and household
location, commuting costs, and can incorporate labor mobility between
cities, making it the ideal platform on which to explore new technolo-
gies that affect transportation costs and land use. Using this model, cali-
brated numerically to an average mid-size U.S. city as a basis, we intro-
duce autonomous vehicles by altering parameters and functions, includ-
ing marginal commuting costs and the land used for parking. Finally
we layer onto this framework autonomous taxis, which we implement
through further reductions in parking needs and commuting costs.
We have identified three research questions that are not adequately
addressed in the current literature, to which we are able to contribute
using this model: 1) will AVs make the physical footprint of cities larger
or smaller; 2) will AVs save energy; and, 3) what are the implications of
AVs for housing affordability? We seek to answer these questions under
different assumptions regarding the manner in which the technology is
implemented.
We have several main findings related to these questions as they per-
tain to mid-sized U.S. cities.8 The first is that the effect of autonomous
vehicles on urban form is ambiguous for a city of a given size, and
depends heavily on the manner of AV implementation. The main rea-
son for this ambiguity is the tension between reductions in commuting
costs due to the direct effect of AVs, increases in commuting costs due
to increased traffic congestion, and greater density due to land previ-
ously used for parking that is now used for additional commercial and
residential purposes. If car-sharing technologies are not adopted and
substantial center-city land is still used for parking, then the model
result is substantial sprawl. However, if parking land is reclaimed, the
geographic footprint of the city shrinks.9
The second main finding is that in virtually all parameterizations,
autonomous vehicles increase energy use by households. While the par-
tial effect of AVs is to reduce energy consumption, the reallocation
of the household budget towards housing and the numeraire good,
combined with agglomeration externalities in goods production and
7
The distinction between commuter parking and other forms of parking is
intentional. This paper considers only parking and transportation costs borne
by commuters. While commuter trips are only a fraction of all trips made by
automobile, travel times for other purposes are likely correlated with commute
times.
8
Our model considers only a single city size calibration (about 1,000,000
people) and is not designed to model small cities without congestion, or large,
polycentric cities with alternative transportation technologies such as subways
or light rail.
9
Zakharenko (2016) models parking and autonomous vehicles in a mono-
centric framework, and finds the net effect to be sprawl for a city with a fixed
population. While an important contribution, this paper presents the results of
only a single parameterization. Rappaport (2016) calculates simulations of sys-
tems of cities, and predicts AVs to cause sprawl for a city with a fixed population
and no changes in demand for parking.
2
Regional Science and Urban Economics 81 (2020) 103484
increased traffic congestion, causes energy consumption to increase on
a net basis. This result runs counter to engineering studies that argue
AVs will save energy. We show that this finding, in particular, high-
lights the need to consider emerging technologies with a model that
allows for general equilibrium effects on the structure of a city.10
Finally, the model predicts that house prices will unambiguously
fall for a city of a given size if parking is reclaimed for other uses. This
occurs because the effective land supply is increased by the introduction
of AVs: suburban land becomes more accessible to the center-city due
to the reduction in commuting costs, and land within the city is made
available through repurposing land that was previously used for park-
ing. Due to the increase in land supply, additional interior space can
be added to the city at low cost, reducing housing prices on average,
and in nearly all locations due to the spatial equilibrium condition. In
models where migration occurs and the city population increases, the
average house price per square foot still falls. This result from the model
suggests autonomous vehicles may help increase housing affordability,
an increasingly salient issue in U.S. cities.
Beyond these new results, we also offer findings that corroborate
those in the literature, especially regarding the effects of AVs on traffic
congestion in a world occupied by endogenous actors. Duranton and
Turner’s (2011) hypothesis of a “fundamental law of road congestion”
is reinforced by our work. The idea is that any short-run reductions in
commuting times in large cities will simply induce in-migration until
the roads are nearly as congested as before. Rappaport (2016) also
reaches this conclusion in his simulated response of high-productivity
cities to the introduction of AVs. Autonomous vehicles are perhaps no
different than adding additional highway capacity in this regard.11
Overall, the cumulative effect of AVs and car-sharing technologies
is dramatic. Household utility increases under all AV assumptions con-
sidered, as reflected directly in the utility calculation for cities with
no migration and population increases for cities with migration. The
model predicts lower house prices, higher productivity, greater popula-
tion density, and higher energy consumption and carbon emissions. AV
cars have the potential to reshape cities, and as we demonstrate in the
following sections, the standard urban model continues to be an ideal
platform on which to consider emerging urban technologies.
2. Background
The standard urban model (SUM) of Alonso (1964), Mills (1967),
and Muth (1969) treats as endogenous housing production, housing
consumption, commuting costs, and location choice within an urban
environment. Extensions within this framework are numerous, with
those particularly relevant to the study of autonomous vehicles includ-
ing the allocation of roads (Wheaton, 1998), space for parking (Brueck-
ner and Franco, 2017, 2018), and energy consumption (Larson et al.,
2012) within the city. Its foundations and extensions have demon-
strated that the SUM is an ideal basis for modeling and predicting the
general equilibrium effects of changes to transportation technologies.
Here, we present a brief, conceptual overview of the textbook SUM and
how it relates to AVs.
10
A number of studies consider transportation and residential location in an
endogenous system. Studies which predict AVs will reduce energy consumption
in cities include Brown et al. (2014), Greenblatt and Saxena (2015), Fagnant
and Kockelman (2015), Wadud et al. (2016), and many others. Studies that
consider energy use in the standard urban model include Larson et al. (2012),
Larson and Yezer (2015), Larson and Zhao (2017), with inclusion of model
choice in Borck and Brueckner (2018). To our knowledge, no study exists which
considers the energy implications of AVs considering housing, commuting, and
numeraire consumption together.
11
It should be noted that we do not consider the intensive margin of vehicle
use. As marginal transportation costs fall, the number of trips will also likely
rise, further adding to congestion. In our model, we only consider commuting.
W. Larson, W. Zhao
While many papers on the SUM present analytical solutions, this
is not always possible. Because of the increasing layers of complex-
ity needed to augment the base model in innovative ways, extensions
are often solved numerically, or “simulated” (e.g. Muth, 1975, Altmann
and DeSalvo, 1981, Bertaud and Brueckner, 2005, and Borck, 2016, to
name several). The strategy in this numerical simulation literature is
to calibrate the model to a real-world city or an average of cities, and
then alter the core parameters in the model to produce counterfactual,
general equilibrium predictions.
In the classic rendition of the SUM, the city lies on a feature-
less plane, with no geological or regulatory features that would
inhibit development. Firms occupy the Central Business District (CBD),
and they exogenously demand identical workers to produce a single
exported good, which provide the impetus for households to locate and
remain in the city. An agricultural hinterland determines the reserva-
tion land rent at the edge of the city. Between the CBD and the hinter-
land is the residential district, which houses the workers who commute
to the CBD, always by car. There is typically no mixing of market-driven
land use at a particular location, but there are some exceptions, includ-
ing Wheaton (2004).
Housing producers and households receive a reservation profit and
level of utility, respectively, at every location inside the city. The house-
hold iso-utility condition, as given by “Muth’s (1969) equation,” gov-
erns the relation between house prices, housing consumption and trans-
portation costs. At locations where commuting costs are low, house-
holds have greater willingness to pay for housing. The production func-
tion for housing involves structure and land inputs. Because areas near
the CBD are valued higher by households, and the land endowment
is fixed at each location, density and house prices are higher near the
CBD, and quantity consumed is lower.
The model is typically presented as a long-run solution that is fully
“putty-putty.” When parameters in the model are altered, all endoge-
nous variables react without respect for initial conditions, including
road networks and urban density. The result of changing parameters
and functions in the model is to construct a completely new and dis-
tinct city.12
The key features in this model as it pertains to AVs are transporta-
tion costs and land use for parking. Because the city is an endoge-
nous system, a change to either affects the character of the entire city.
Changes to parking land use or transportation cost parameters have
directionally predictable effects based on the existing SUM. However,
magnitudes and net effects when both are incorporated simultaneously
along with endogenous road congestion are a significantly greater chal-
lenge, as we now discuss.
Changes to transportation costs have been examined in the litera-
ture. It is well-established that Muth’s equation predicts lower trans-
portation costs result in a city with greater land area and lower
density—in a word, sprawl—and AVs are no different. But there is a
countervailing effect of AVs on urban form that must be considered.
AVs will reduce demand for parking compared to a baseline city, thus
resulting in a city with less land used for parking and more land for
goods and/or housing production. AVs have two main channels that
might cause lower demand for commuter parking, both in the CBD and
in the residential district. First, AVs will not need to be parked near the
destination, with automation enabling parking in less costly areas of
the city. Second, car sharing may increase automobile utilization rates,
reducing the number of necessary parking spots, holding population
constant. This parking demand effect increases density.
When combining these effects, we see that the effects of AVs on
urban form are complex and ambiguous. While both Rappaport (2016)
and Zakharenko (2016) predict sprawl, Rappaport’s model does not
12
It is common in the literature to discuss the results of counterfactual simu-
lations as “changes” to a city. To be clear, simulations here are not meant to be
changes to an existing city.
3
Regional Science and Urban Economics 81 (2020) 103484
include the possibility of land repurposing from parking to other uses,
and Zakharenko’s model does not include traffic congestion or residen-
tial district parking.
These complexities flow through to the effects of AVs on energy con-
sumption. While energy consumption may fall due to effects of lower
congestion and faster commuting speeds, it may rise because sprawled
cities include larger houses and longer commutes. Greater productivity
and output increases goods consumption, increasing energy consump-
tion, all else equal. Finally, and autonomous parking may save land for
parking, but it results in additional trips that consume energy. Some
of these rival forces are considered by Borck (2016), Larson and Zhao
(2017), and others in the context of height limits, greenbelts, and tele-
work. But as with urban form, the effect of AVs on energy consumption
is theoretically ambiguous.
What is needed is a thorough treatment of both parking and traffic
congestion, and an evaluation of the sensitivity of modeling decisions
on outcomes in order to evaluate the various effects on the city. The
model in the next section is based on the SUM, but incorporates func-
tional forms that allow the general equilibrium effects of AVs to be
modeled.
3. Baseline model structure
The purpose of the baseline model is to produce solutions that
numerically mimic a present-day city, while providing a platform on
which experimental scenarios related to AVs can be explored. The first
step is to assume functional forms for the behavior of the agents, pro-
duction functions, and other attributes of the city such as traffic conges-
tion and land use. Values and functions are then taken from the prior
economics literature or engineering relationships, and then calibrated
with respect to a vector a city attributes. The following model describes
a baseline city in which each commuter drives a car to the CBD for
work. In later AV scenarios, attributes of the baseline city are modified,
giving new counterfactual cities.
3.1. The central business district
The role of the CBD in the standard urban model is to exist as a
location that demands labor in the city. Households then seek to locate
near the CBD to economize on commuting costs. Though there are some
notable exceptions, little attention is typically paid to the treatment of
the CBD in models that require numerical simulations. A singularity at
the center of the city is often assumed; in other models where a singular-
ity would interfere with the model solution, such as in the case of con-
gestible roads, the CBD typically occupies a fixed land area. Recently,
there have been some attempts to model the production, land use, and
agglomeration economies present in the CBD (Rappaport, 2016). Oth-
ers have developed models with parking production and land use, either
without (Brueckner and Franco, 2017) or with production (Brueckner
and Franco, 2018). Models including endogenous land use within the
city include Fujita and Ogawa (1982) and Lucas and Rossi-Hansberg
(2002), but these do not include parking land.
It is necessary for us to model production, parking, and land use in
the CBD because of the parking land that may be reclaimed once AV
cars are introduced. AV cars are expected to reduce the need for center-
city parking, and in some solutions of the model, induce migration into
the city. The CBD therefore needs to have both a production function for
goods that can incorporate land, labor, and agglomeration economies.
We then assume the CBD is a single, homogeneous area, in order to
avoid a singularity at the center. Finally, we assume the CBD is a fixed
land area, starting at a point in the center of the city and extending to
radius kCBD . While the CBD area may expand or contract due to changes
in relative prices and bid-rent curves, this is a standard assumption in
the literature and one that greatly simplifies the model and allows us to
focus on residential location.
W. Larson, W. Zhao
Land use in the CBD is fixed and divided between fixed shares of
parking, export goods production, and other uses, with values of 𝜃 indi-
cating land use shares. The CBD extends from radius zero to radius kCBD .
𝜃park + 𝜃prod + 𝜃other = 1, 0 < k < kCBD (1)
We now turn to the two activities that are modeled within the CBD,
parking and goods production.
3.1.1. Goods production
Because the city is circular and radial, land used for goods produc-
tion (and other areas in the city) can be expressed using the standard
formula for the area of a circle. The radius of the CBD is kCBD and the
share for production is 𝜃 prod , so the land endowment for production is
Lq,CBD = 𝜃prod 𝜋 k2CBD (2)
Following Glaeser and Gottlieb (2009), the export good in the city is
produced by a single perfectly competitive firm using a Cobb-Douglas
production function F(N, L, K), where N is an endogenous number of
workers and is equal to the city population, L is the CBD land exoge-
nously devoted to commercial production, and K is the endogenous
capital input. Localized agglomeration externalities in labor inputs are
present, giving a technology function B(N) = BN𝜓 , where B′ > 0,
B′′ < 0, and 0 < 𝜓 < 1. The production function is:
𝜈
F (N , L, K ) = BN 𝜓 N 𝜈1 Lq2,CBD K 1−𝜈1 −𝜈2 (3)
The firms’ first-order conditions result in a city-level labor demand
equation,
( ) −1
𝜈1 +𝜈2
𝜓𝜈1 1 pK
W = pK 𝜈2 (4)
1 − 𝜈1 − 𝜈2 N (1 − 𝜈1 − 𝜈2 )BN 1 L
𝜈 +𝜓
q,CBD
The key feature in this expression as it relates to the model concerns
relations among parking land, commercial land, and labor demand. As
land is reallocated from parking towards goods production, demand for
labor increases, resulting in some combination of higher wages and/or
population.
3.1.2. Parking production
Parking is supplied at a fixed price pparkCBD in the CBD. We do not
explicitly model the production of parking spaces, but we arrive at a
constant price under the following logic. Suppose parking is produced
using capital and land inputs that are perfectly substitutable. Given an
exogenous land input, the land endowment is used to supply a fixed
number of parking garages that may add or subtract floors under con-
stant marginal cost in order to fully satisfy demand. While this may be
unrealistic in the case of small cities with CBD surface parking, or large
cities where increasing the capacity of garages becomes problematic,
for moderate city sizes, this assumption should approximate reality.
There are numerous extensions possible within this CBD modeling
framework. One of possible first-order concern is modal choice in com-
muting (e.g. walking vs automobile transport). While modal choice
would add richness to the model, the solution would become more com-
plex along a number of dimensions. For instance, modal choice would
create differentials in the effects of private versus employer-paid park-
ing (Brueckner and Franco, 2018). Additionally, optimizing behavior
would result in an equilibrium price and quantity of parking spaces
supplied, rather than the fixed values we assume here.
3.2. The residential district
The residential district occupies land between kCBD and k. While
kCBD is set exogenously, the city boundary, k, is endogenous. Land use
in the residential district is divided among parking, roads, housing, and
other uses.
𝜃park (k) + 𝜃hous (k) + 𝜃road + 𝜃oth = 1, kCBD ≤ k ≤ k (5)
4
Regional Science and Urban Economics 81 (2020) 103484
The fractions of land for roads 𝜃 road and other uses 𝜃 oth within the
residential district are constant across k, as found empirically by Duran-
ton and Puga (2015), who show land used for transport, and the fraction
of developed residential land (𝜃 hous + 𝜃 park in our model), is roughly
constant between 5 and 15 km from the center of Paris.
The land used for parking and housing is determined endogenously,
and varies by k. To derive these land shares, we begin with the follow-
ing expression, where c is the (constant) size of a parking space, 𝜖 is the
(constant) number of parking spaces per household, and h(k) the size of
each housing unit at radius k.13
c𝜖
𝜃park (k) = 𝜃hous (k) (6)
h (k )
The proportion of land used for housing can then be expressed as a
function of a single endogenous variable, the average dwelling size, and
then solved as part of the final system of partial differential equations
in Section 3.3.
1 − (𝜃road + 𝜃oth )
𝜃hous (k) = (7)
1 + c𝜖∕h(k)
3.2.1. Housing and parking production
Housing H at distance k from the CBD, is produced by combining
structure, S, and land, L, inputs under a constant returns to scale tech-
nology according to a CES production function:
[ ]1∕𝜌
H (k) = A 𝛼1 S(k)𝜌 + 𝛼2 L(k)𝜌 (8)
Structure inputs are perfectly elastically supplied. Land is supplied from
𝜃 hous (k).14 Housing is rented at a price r(k).
Parking has the same production function as housing, following
Brueckner and Franco (2017). The logic in using this production func-
tion for parking is that at high land prices, liveable space above
the garage will be standard. As land prices fall, stand-alone garages
will become more common. Effectively, the producer has a cost-
minimization problem, as 𝜖 parking spaces per unit of size c is fixed.
The rental price for a parking space is assumed r(k) per square foot.
3.2.2. Household budget constraint
All households are identical and maximize a CES utility function
consisting of two goods, rental housing h and a numeraire consumption
good y, subject to a budget constraint.
[ ]1∕𝜂
U = 𝛽1 y𝜂 + 𝛽2 h𝜂 (9)
𝛽 1 and 𝛽 2 are related to consumption shares between the two argu-
ments, and 1∕(1 − 𝜂) represents the constant elasticity of substitu-
tion between housing and the numeraire good. Household income, w, is
divided among a basket of goods and costs that vary based on residen-
tial location, and include the numeraire good, y(k), housing purchases,
r(k)h(k), parking, tp (k), and total transportation costs given by the prod-
uct of workers per household, 𝜖 , and transportation costs per worker,
T( k ) .
w = y ( k ) + r ( k ) h ( k ) + tp ( k ) + 𝜖 T ( k ) (10)
The treatment of parking and transportation costs is one of the key
features of the model. Parking, tp (k), includes both CBD and residential
parking. The price of parking in the CBD is pparkCBD and the price at
13 To illustrate, let c = 300, the size of each parking space, 𝜖 = 1.25, the
number of commuters per household, and h(k) = 1500, the size of each house
for some k. Then, the land share for parking is 0.25 the land share for housing,
or 20% (0.25/1.25) of a typical residential lot.
14
This model ignores the role of maintenance, rehabilitation and durability of
structures in housing production.
W. Larson, W. Zhao
home is r(k). In both places, households have 𝜖 commuters each requir-
ing c units of parking.
tp (k) = c𝜖(pparkCBD + r (k))
Transportation costs, T(k) are borne by each commuter 𝜖 , and
include a fixed cost tf , which includes taxes, insurance, and obsoles-
cence; pecuniary costs t(k), which includes both the constant marginal
cost per unit distance m and a variable marginal cost which depends
upon traffic congestion; and a time-cost, tw (k). There are two trips each
day, so each of these costs is multiplied by two.
T ( k ) = tf + t ( k ) + tw ( k )
where
k
1 land shares as a function of commuting costs and housing unit density,
t (k) = 2(mk + pg d𝜅)
∫0 G(V (M (𝜅)))
k
1 There are two different model closing conditions that can be
tw (k) = 2(𝜏 w d𝜅)
∫0 V (M (𝜅))
In t(k), the first term is the constant marginal cost of distance mul-
tiplied by distance to give mk. The constant marginal cost of distance
includes costs based on miles travelled, i.e. tires, oil changes, and other
routine maintenance. The variable marginal cost of distance is the price
of gasoline, multiplied by the fuel spent going through each annulus of
the commute, contained within the integral. This integral contains the
inverse of the fuel economy of the vehicle G, a function of the speed
of the vehicle V. The speed is a function of traffic congestion, which
includes the argument M, the ratio of commuters to roads.
We follow Larson et al. (2012), who specify G(V(k)) in Equation (12)
as a 4th degree polynomial.15
G(V (k)) = .822 + 1.833V (k) − .0486V (k)2 + .000651V (k)3
− .00000372V (k)4
This function gives about 14 miles per gallon at 10 miles per hour,
up to a maximum of 29 miles per gallon at 50 miles per hour, and
then falling to about 25 miles per gallon at 70 miles per hour. Under
the assumptions that each worker in the city owns the same vehicle as
the average vehicle in the U.S. fleet, this function gives an appropriate
representation of commuting fuel used in the simulation.
For V(M(k)), we use the “Bureau of Public Roads” congestion func-
tion used by Muth (1975), where velocity is related to the ratio of cars
⃖⃖⃗(k) = ∫ 𝜖 2𝜋𝜃hous (k)kD(𝜅)d𝜅 , to the
travelling through the annulus, N
k is re-initialized with a higher or lower house price and solved again
k
⃖⃖⃗(k)∕R(k). The parameters a, b, and c are
road area, R(k), or M (k) = N
calibrated congestion parameters.
1 reservation utility level. The solution method involves first establishing
V (k ) =
a + bM (k)c
The term tw (k) in equation (12) represents the time-cost of commut-
ing. The expression 𝜏 w relates the time cost of commuting to the wage
in a multiplicative fashion as a fraction 𝜏 , of the wage rate, w. The total
time cost spent per commute is the integral of the time spent travelling
through each annulus. The parameter 𝜏 is assumed to be 0.5 by Bertaud
and Brueckner (2005), and we follow this assumption in our baseline
city. In the AV scenarios, we reduce this to 0.3 to reflect enhanced
leisure activities available while commuting, though we also consider
other values in an Appendix.
3.3. Model solution
The solution method follows Muth (1975), Arnott and MacKinnon
(1977), Altmann and DeSalvo (1981), and McDonald (2009). The sys-
15
Larson et al. (2012) estimate this function using data gathered by West et
al. (1999) for an average vehicle in the U.S. fleet.
Regional Science and Urban Economics 81 (2020) 103484
tem of equations described above can be solved and reduced to a system
with two simultaneous nonlinear differential equations with initial val-
ues. After a solution is obtained, the remaining gradients can be found
(11)
recursively. The two-equation system of equations includes differential
commuting costs and the household density at radius k, with known ini-
tial values at the CBD. This system is solved numerically using Matlab’s
ODE 45 solver with a differential of 0.1 mile and default convergence
tolerance.
[ ] [ ]
dT (k) T (kCBD )
and (15)
dN (k) N (kCBD )
(12)
After solving this system, it is possible to derive house prices, hous-
ing demand, land prices, structure/land ratios, and housing and parking
following Altmann and DeSalvo (1981). Then it is possible to calculate
energy consumption using methods found in the next section.
assumed depending on the purpose of the model. The first is the “closed
city” model closing condition, which assumes a fixed population but
allows utility to vary. This solution can be interpreted in several ways,
including a single city in autarky, the response of a nation-wide inno-
vation that has an equal effect on all cities and has no effect on net
migration, or as a snapshot of a city within a given size class under
different parameterizations.
The second set of closing conditions considers an “open city” model,
which assumes a fixed utility, allowing population to vary. This is the
typical assumption in a regional equilibrium or system of cities frame-
work, and is useful to analyze a city-specific technology shock. Because
our model is putty-putty and there is no durable housing, we caution
against this interpretation, as the introduction of AVs in a real-world
city will take decades to be fully implemented, and potentially cen-
turies to have complete effects on the urban spatial structure.16 Rather,
(13)
these models are meant to represent a highly stylized world where AVs
are introduced and the city fully and immediately adjusts to its new
equilibrium.
To implement the “closed city” (i.e. constant population) rendition
of the model, first, the land price at the edge of the city must be equal to
the agricultural land rent pL (k) = paL , and second, the number of workers
in the city must be equal to the number of jobs available 𝜖 N = E. The
simulation is initialized by assuming a house price at the edge of the
CBD. If either of these equilibrium conditions is not met, the simulation
until subsequent iterations achieve an equilibrium solution. Note that
in this city, equilibrium utility can rise or fall.
In the “open city” rendition, population adjusts in order to achieve a
(14)
a closed city solution, then if the utility is above (below) the reservation,
increasing (decreasing) the population and then re-solving the closed
city, assuming full employment. In equilibrium, utility is equal to the
reservation and the population may be different than that which was
initialized at the beginning of the solution algorithm.
3.4. Energy consumption
After solving the model, energy consumption can be calculated
recursively following Larson and Zhao (2017). Household energy con-
sumption at radius k, E(k), can be categorized into three main types:
electricity in the dwelling, ED (k), gasoline while commuting, EC (k),
and numeraire, which embodies all other forms of consumption, EN (k).
All energy is measured in terms of British thermal units (BTUs) and
16
Transportation networks are remarkably path-dependant. Historic structure
designations also encourage path dependance.
5
W. Larson, W. Zhao
includes energy consumed in production and transmission.17
C D N purposes of computing energy consumption. The sum of these com-
E (k ) = E (k ) + E (k ) + E (k ) (16)
Energy used in commuting by a household living in annulus k who
commutes to the CBD is given by
k
1 This numeraire expenditure value is multiplied by an (inverse)
EC (k) = Eg d𝜅 (17)
∫0 G(V (M (𝜅)))
where G(V(M)) is described in Equation (13), and Eg is the energy
embodied in a gallon of gasoline in BTUs, described as follows.18 The
base energy content of a gallon of 100% petroleum-based gasoline is
125,000 BTUs. According to the Federal Register (2000) published by
the Energy Information Administration, 1 gallon of gasoline requires an
additional 25,602 BTUs to be expended in the process of production and
distribution. Thus, Eg = 150, 602 BTUs of total energy are embodied
in final consumption. Eg is multiplied by the amount of fuel consumed
in gallons to arrive at the value for commuting energy consumption.
Dwelling energy consumption is determined by three major factors:
the income of the household, the square feet of interior space, and
structure type. Larson et al. (2012) also estimate residential energy
demand parameters using the 2005 Residential Energy Consumption
Survey (RECS). They find the partial elasticity of household energy
consumption with respect to interior space is 0.23 and the estimated
income elasticity is 0.07. Compared with the energy consumption in
single-family detached units, single-family attached dwellings consume
7% less energy and multi-family units consume 31% less energy. In the
simulation, the structure type, s(q(k)), is determined by the structure
to land ratio, q, defined as the ratio of housing square footage over lot
size, denoted q = H∕L, which varies over k. The critical values of q for
each structure type are calibrated. The structure type is single-family
detached if q ∈ [0, 0.6], single-family attached if q ∈ (0.6, 0.7], 2–4
unit multifamily if q ∈ (0.7, 0.8] and 5 + unit multifamily when q is
above 0.8.
For simplicity, it is assumed all energy consumed in the dwelling is
electricity.19 Each kilowatt hour of electricity consists of 3412 BTUs of
energy. As with gasoline, there is also energy embodied in production
and distribution. The total energy consumed in the production, distri-
bution and final dwelling energy use can be calculated by dividing final
dwelling energy use by electricity efficiency parameter 0.303, giving Ee ,
which is the product of the efficiency parameter for fossil fuel electric-
ity production 0.328 and efficiency parameter for electricity transmis-
sion 0.924 (Federal Register, 2000). This gives dwelling electricity as a
function of dwelling size, with multiplicative shift factors that depend
on income, the energy price, and structure type.
[ ]
ED (k) = Ee exp 𝛾1 + 𝛾2 ln w + 𝛾3 ln pe + 𝛾4 ln h(k) + s(q(k))′ Γ (18)
In the expression above, the partial effects of covariates are represented
by 𝛾 s for income, energy prices and interior square feet, and the vector
Γ for different structure types.
Calculation of numeraire energy consumption begins with
numeraire good consumption. Added to this are expenditures on non-
gasoline commuting costs and non-energy dwelling costs, which are
17
Different types of energy consumption may carry with them different types
of externalities, and these are not considered. For instance, fossil fuels burned
miles away from a city in a power plant may produce less particulate matter and
volatile organic compounds that harm households versus those burned within
the city in the form of gasoline. The simulation model in this paper does not
consider these nor other local environment or climate-related externalities.
18
While AV cars in the future may be electric and thus have different power-
trains, these are not considered. The primary goal of the paper is to establish
the effects of AVs, not electric vehicles.
19
Electricity-only consumption is associated with lower per-household energy
use compared to homes with natural gas, wood, or oil, according to the RECS.
Therefore, estimates in this paper serve as the lower bound of energy consumed
in the home.
6
Regional Science and Urban Economics 81 (2020) 103484
assumed to have the same energy content as the numeraire good for
ponents is calculated as a residual from earnings net of gasoline and
electricity expenditures, w − pg EC (k)∕Eg − pe ED (k)∕Ee . The values
pg EC (k)∕Eg and pe ED (k)∕Ee are the expenditures on gasoline and elec-
tricity, respectively, following Equations (17) and (18).
energy intensity parameter to calculate numeraire energy consumption.
( )
EN (k) = EN w − pg EC (k)∕Eg − pe ED (k)∕Ee (19)
The energy embodied in $1 of numeraire consumption is estimated
to be EN = 7, 470 BTUs, which is the average energy intensity of
the U.S. economy (Energy Information Administration, 2011). Energy
intensity is used for this measure because it implicitly includes all
energy in the raw materials, intermediate input production, final pro-
duction, and transportation of the goods and services.
Finally total energy consumption in the city is the integral of E(k)
multiplied by the housing unit density D(k) over the city area.
k [ ]
E= 2𝜋 D(k) EC (k) + ED (k) + EN (k) dk (20)
∫kCBD
4. Baseline calibration and counterfactual cities
4.1. Baseline city
We calibrate the model with respect to the characteristics of an aver-
age present-day U.S. city. Cities are selected based on three filters which
are set to capture cities that have low regulation, few topographic inter-
ruptions, and are of moderate size. The regulation filter is based on the
Wharton Residential Land Use Regulatory Index (Gyourko et al., 2008),
and includes cities with an index value of less than zero. The topog-
raphy filter includes cities with over 90% of nearby area topographi-
cally available for development (Saiz, 2010). Finally, the city size filter
includes cities with between 300,000 and 700,000 housing units in the
principal cities. The principal cities of Charlotte, Indianapolis, Kansas
City, and San Antonio pass these criteria, and our simulation is cali-
brated to a simple average of values in these cities.20
Parameters are either taken from the existing literature or cali-
brated to give reasonable simulation outputs. These parameter values
are shown in Table 1. Once calibrated, the housing and utility parame-
ters are close to those found in Altmann and DeSalvo (1981). Altmann
and DeSalvo (1981) employs elasticities of substitution between struc-
ture and land inputs in the housing production function, and housing
and the numeraire consumption good, of 0.75 in both equations. Land
shares to housing and roads are similar to Muth (1975), as well as the
speed parameters in the congestion function. Fixed and marginal com-
muting costs are from the American Automobile Association. The time
cost of commuting for drivers is from Bertaud and Brueckner (2005),
and set to 50% of the wage. The reservation agricultural rental price
per acre per year is $500, which corresponds to $10,000 per acre at a
5% capitalization rate. Parking space per car is set to 300 square feet of
land area, and the annual parking fee per car in CBD is set to $1200.
The resulting baseline city is remarkably similar to the four-city
composite. The major difference is the city we simulate is slightly
denser and geographically smaller.21 Gradients within the baseline city
20
Suburbs are not included in the tabulation because the simulation is focused
on areas nearest to the center of cities where gradients are closest to being
monotonic.
21
This is a well-known characteristic of cities simulated with a single income
group (Muth, 1975), and previous research has shown this characteristic—and
small perturbations in other simulation parameters—to have negligible effects
on differences between baseline and counterfactual cities (Larson and Zhao,
2017).
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Table 1
Baseline simulation parameters.
Parameter Value Description Source
Central Business District
kC BD 1 Radius of the CBD (miles) Assumed
𝜃 park 0.25 fraction of CBD land used for parking Shoup (2005)
𝜃 prod 0.55 fraction of CBD land used for commercial production Assumed
𝜃 road 0.2 fraction of CBD land used for roads Muth (1975)
𝜈1 0.7 Labor share parameter in CBD production function Assumed
𝜈2 0.1 Land share parameter in CBD production function Assumed
pparkCBD $1200 Annual parking fee in CBD Various online sources
N 450,000 Households American Community Survey
W 49,867 Earnings per household per year American Community Survey
Residential District
𝜃 road 0.2 fraction of residential land devoted to roads Muth (1975)
𝜃 oth 0.45 fraction of residential land devoted to other use Muth (1975)
1∕(1 − 𝜌) 0.75 Elasticity of substitution in the housing production function Altmann and DeSalvo (1981)
𝛼1 1 Structure share parameter in housing production function Muth (1975), Altmann and DeSalvo (1981)
𝛼2 0.03 Land share parameter in housing production function Muth (1975), Altmann and DeSalvo (1981)
A 0.105 Housing production technology parameter Calibrated
1∕(1 − 𝜂) 0.75 Elasticity of substitution in the utility function Altmann and DeSalvo (1981)
𝛽1 1 Numeraire share parameter in utility function Numeraire
𝛽2 0.2863 Housing share parameter in utility function Calibrated
𝜏 0.5 Time-cost of commuting (fraction of wage) Bertaud and Brueckner (2005)
s 300 parking area per car (sq. ft) Authors’ measurement
paL 500 Reservation agricultural price per acre of land Bertaud and Brueckner (2005)
pg 3.5 Gasoline price per gallon Energy Information Administration
tf 2123 Fixed cost of commuting American Automobile Association
m 0.222 Dollars per mile of depreciation American Automobile Association
G(V(k)): constant 0.822 coefficient in gasoline-speed equation Estimated by Larson et al. (2012)
G(V(k)): 𝛽 V (k) 1.833 coefficient in gasoline-speed equation Estimated by Larson et al. (2012)
G(V(k)): 𝛽V (k)2 −0.048 coefficient in gasoline-speed equation Estimated by Larson et al. (2012)
G(V(k)): 𝛽V (k)3 0.000651 coefficient in gasoline-speed equation Estimated by Larson et al. (2012)
G(V(k)): 𝛽V (k)4 −3.7E-06 coefficient in gasoline-speed equation Estimated by Larson et al. (2012)
vlow 5 Minimum commuting speed Assumed
vhigh 45 Maximum commuting speed Assumed
c 1.75 Parameter in speed function Calibrated
Eg 150.6 Energy per gallon of gasoline (125 × 1/0.83 efficiency) Energy Information Administration
q0 0.8 5 + unit building Calibrated
q1 0.7 2–4 unit building Calibrated
q2 0.6 sf. attached Calibrated
Ee 0.303 Production and transmission efficiency for electricity Energy Information Administration
EN 7470 BTUs per dollar of GDP Energy Information Administration

Table 2
Simulation calibration.
City Charlotte Indianapolis Kansas City San Antonio Average Simulation Baseline
CBSA Code 16740 26900 28140 41700
Lot Size (acre) – Occupied Unitsa 0.36 0.31 0.25 0.20 0.28 0.16
Unit (square feet) – Occupied Unitsa 1694 1668 1655 1382 1599 1520
Area (sq. miles)b 444 409 515 505 468 290
Radius (assuming circle)b 11.9 11.4 12.8 12.7 12.2 9.6
Wharton Regulatory Index (Gyourko et al., 2008) −0.53 −0.74 −0.79 −0.21 −0.57 –
Unavailable Land (Saiz, 2010) 5% 1% 6% 3% 4% 0%
Median Incomeb 50,702 46,970 49,001 43,586 47,565 49,868
Total Occupied Unitsb 412,445 410,594 360,109 547,627 432,694 450,000
Time to workb 25.1 23.8 22.3 24.6 23.9 20.1
Fraction housed in 1 unit structuresb 71% 71% 70% 54% 66% 64%
Fraction housed in 2–4 unit structuresb 12% 12% 15% 14% 13% 17%
Fraction housed in 5 + unit structuresb 16% 17% 15% 32% 20% 19%
Energy consumed in dwelling, per capita (mmBTUs)c – – – – 49.8 89.6
CBD Parking Cost per Month 120 110 70 100 100 100
a
Source for actual values: AHS (2011).
b
Source for actual values: ACS (2010).
c
Source for actual values: RECS (2009) households with 100% electricity consumption.

7
W. Larson, W. Zhao
are shown in Fig. 1, including downward sloping house price and struc-
ture density, and upward sloping housing consumption and energy use
gradients.22
4.2. Counterfactual cities
To model the effects of autonomous vehicles, we alter various
parameters and functions from the baseline model. The numerical solu-
tions to these new models give counterfactual cities that can then be
compared to the baseline or other counterfactual cities.
We consider three different parameterizations, each representing
different technological assumptions regarding implementation of AVs
within a city. It is useful to consider a range of models due to the range
of technological and public policy possibilities, including variation in
commuting costs, car ownership, parking reallocation, and means of
adjustment to a new urban equilibrium. In this section, we describe the
each of these counterfactual cities in turn, before moving onto results
in the following sections.
4.2.1. City 1: basic autonomous vehicles
In our first counterfactual city, we model the introduction of AVs in
the most direct manner possible; we reduce the time-cost of commuting
and make no other changes. There are no coincident technologies such
as car sharing or electric vehicles, and there is no change in demand for
parking anywhere in the city. This is implemented by reducing the time
cost fraction, 𝜏 , in Equation (12). This is originally set at 0.5, or 50% of
the wage rate for the baseline city. For the AV city, we set 𝜏 = 0.3 to
reflect a lower disamenity of time spent commuting. This new value for
𝜏 is speculative, so we also consider alternative parameterizations of 𝜏 ,
ranging from 0.1 to 0.4, shown in the Appendix.
It is known a reduction in the marginal cost of distance will flatten
the house price, land price, and density gradients, and increase housing
consumption, and energy consumption, all else equal (see Coulson and
Engle, 1987, Mieszkowski and Mills, 1993, Brueckner et al., 2001, and
Larson and Zhao, 2017, for instance).23 The purpose of this model is
to capture this straightforward transportation cost effect before moving
on to more complex models.
4.2.2. City 2: No CBD commuter parking
In the next counterfactual city, we introduce commuters who have
autonomous vehicles that return to home to park during the work day.
This involves four one-way trips per day for the vehicle, with people
riding in the vehicles for two of them. Because commuter parking no
longer occurs in the CBD, this land is instead used by goods producers.24
To implement this technological alternative in terms of parameters
and functions in the model, we set 𝜏 = 0.3 as in the basic AV city,
but in addition, we make three other changes to the model. First, we
22
For a complete set of gradients for the baseline city, see Appendix Figs. A.1
and A.2. Dwelling and total energy use gradients have discrete jumps at struc-
ture type transitions from multifamily, to single-family attached, to single-
family detached.
23
Analytic predictions of a fall in transportation costs in the standard urban
model are available in Brueckner (1987). These predictions encompass the
effects of a simple model with a reduction in commuting costs for any reason,
including AVs. Unfortunately, analytic solutions of models with traffic conges-
tion layered onto other model complexities, such as we do here, are unavailable
(this also includes models of endogenous land use such as Fujita and Ogawa,
1982). Congestion is a first-order concern in our model due to the additional
traffic AVs may cause in different regions of the city. We therefore leave ana-
lytic solutions of the effects of simple AVs under linear transportation costs to
these prior works, and proceed with numerical solution methods in this paper.
24
We have also considered reallocation to residential uses. However, we have
found goods production to dominate residential housing production in the
model.
8
Regional Science and Urban Economics 81 (2020) 103484
reallocate the center-city land endowment from parking to goods pro-
duction, or 𝜃 park from 0.25 to 0 and 𝜃 prod from 0.55 to 0.8. Second,
because there is no center-city parking, the vehicle must make a return
trip to the place of residence to park during the day, then go back to the
CBD to pick up the worker for the commute home. This raises t(k), the
k 1
pecuniary costs of commuting, from t (k) = 2(mk + pg ∫0 G(V (M (𝜅)))
d𝜅)
k 1
to t (k) = 4(mk + pg ∫0 G(V (M d𝜅). Finally, the total parking cost is
(𝜅)))
reduced by eliminating CBD parking. The parking cost falls from
tp (k) = c𝜖(pparkCBD + r(k)) in the baseline and City 1 to tp (k) = c𝜖 r(k),
which is simply the cost of parking in the residential district.
4.2.3. City 3: autonomous taxis
One of the main drawbacks of eliminating CBD parking is the two
“wasted” trips spent by the empty vehicle returning to the home parking
spot during the day and then back to the CBD to pick up the commuter
for the trip home. This problem is exacerbated the further the parking
spot is from the CBD. In this city, we wish to implement a technological
alternative that uses a fleet of autonomous taxis rather than owner-
occupied automobiles.
In this city, we introduce a perfectly competitive firm that owns and
operates a fleet of fully-autonomous vehicles. Commuters pay a hailing
fee and then marginal costs for units of time and distance, as is standard
for current taxi services, including traditional taxi cabs, Uber, and Lyft.
Commuters still dislike commuting, with a time cost fraction 𝜏 = 0.3
of the wage rate.
This scenario is operationalized by making the following additional
changes to the model. First, there is no land used for parking any-
where in the city, including in both the residential and central business
districts.25 Second, the pecuniary fixed and marginal commuting cost
functions are both substantially different, and are instead based on a
taxi-fare model. Accordingly we re-specify tf = 𝜑0 , tp (k) = 0, and
k
t (k) = 𝜑1 k + 𝜑2 ∫0 V (M1(𝜅)) d𝜅 , where 𝜑0 is the fixed hailing fee, 𝜑1 is
the cost per mile, 𝜑2 is the cost per unit of time.
The values for 𝜑0 , 𝜑1 , and 𝜑2 are based on current Uber rates
for Washington, DC (as of March 2018) and from a report by UBS
(2017). Uber rates are chosen to give a reasonable parameterization
under a business model where their stated goal is to eventually shift
to autonomous taxis.26 The UBS report estimates that current taxi rates
will fall by about 54% for autonomous taxis due to market efficiencies,
labor savings, and other cost reductions due to the widespread adop-
tion. This results in 𝜑0 = $1.36 per trip fixed costs, 𝜑1 = $0.50 per
mile, and 𝜑2 = $0.078 per minute.27
This AV taxi cost structure steepens the bid-rent curve by shifting the
cost share from fixed to marginal costs of distance and time. To illus-
trate, suppose an 8 mile trip that takes 25 min at a constant speed (19.2
mph). The AV taxi trip cost is $7.31, with $1.36 fixed costs and $5.95
variable costs. In contrast, for owner-occupied vehicles (both owner and
autonomously driven), the total trip cost is $7.28, with an average fixed
cost of $4.25 and variable cost of $3.04.28 In this case, there is little dif-
ference in the total pecuniary commuting costs. However, because the
cost share changes from fixed to variable commuting costs, the house
price gradient will flatten less than in City 1.
25
Parking for the autonomous vehicles is not specified in the model, but in
practice an autonomous fleet of taxis could be housed on streets and/or in
suburban parking lots outside of the city when not in use.
26
Uber has invested substantial resources experimenting with autonomous
taxis, see https://www.wired.com/story/bet-uber-bet-self-driving/.
27
These autonomous taxi rates are based on current Uber rates of $2.95 per
pickup, $1.08 per mile, and $0.17 per minute, with each parameter multiplied
by 0.46. To explore the robustness of the model solution to these parameters,
we also consider other values in the Appendix.
28
This assumes all fixed costs are divided by the total number of trips, and the
entire 25 min trip is taken at a constant speed, or 19.2 miles per hour, which
gives 22.2 miles per gallon.
W. Larson, W. Zhao
Fig. 1. The baseline model and effects of autonomous vehicles on urban gradients.
5. Autonomous vehicles and sprawl
The first question posed in the introduction relates to sprawl. The
major unresolved issue is whether autonomous vehicles will cause cities
to become more dense because of the land saved from reduced park-
ing demand, or sprawl because of the lower transportation costs. In
attempting to answer this question, we consider six models; the three
counterfactual cities, with both open and closed city model closing con-
ditions.
5.1. City 1 results; basic autonomous vehicles
We first compare the basic AV model solutions to the baseline model
solution. This is the simplest counterfactual scenario we consider, and
involves a 100% adoption of AVs for commuters, but no changes to
any other aspect of the model, including parking behavior. This simu-
9
Regional Science and Urban Economics 81 (2020) 103484
lation is designed to give the maximum sprawl for an owner-occupied
autonomous vehicle because it includes only the reduced transportation
costs.29
The first thing we wish to examine is the change to the bid-rent
curve for housing with the implementation of AVs, shown in Fig. 2. In
the closed city model (with a constant population), the bid-rent curve
rotates to maintain the iso-utility condition. This reflects a lower will-
ingness to pay in areas near the CBD and a greater willingness to pay
in areas far from the CBD. Accordingly, the city sprawls. In the open
city model, the same rotation occurs, but to reach an inter-city equi-
librium, in-migration occurs, shifting the bid-rent curve up. This shift
occurs because there are greater levels of congestion at every radius.
Table 3 column 2 shows tabulations of results for the closed city,
29
This is analogous to the main AV simulation in Rappaport (2016).
W. Larson, W. Zhao
Fig. 2. Direct effect of autonomous vehicles on bid-rent curves.
and Fig. 1 shows some important gradients.30 The city sprawls as pre-
dicted, with the city radius expanding from 9.6 to 10.7 miles. The city
has higher welfare, with household utility rising from 2549 units to
2626 units. When the model is solved using the open city model clos-
ing conditions, migration occurs because the city utility is higher in
the closed city than in the baseline. In this case, as shown in Table 4
column 2, the population, measured by the total number of occupied
housing units, increases from 450,000 in the baseline to about 565,000,
or about 26%. The city radius also expands a further 0.6 miles to 11.3
miles. Clearly, AVs in this most basic scenario cause sprawl.31
5.2. City 2 results; No CBD commuter parking
Next, we consider the case where the AV cars are still owner-
occupied, but center-city commuter parking is no longer available.
In this simulation, CBD land used in previous simulations for park-
ing is now allocated to goods production. Commuter vehicles travel
autonomously (and empty) back to the housing unit during the day to
park, then return to the CBD in the evening to pick up the worker for
the return trip home.
In the closed city rendition of the model, shown in Table 3 column
3, the city radius falls from 9.6 miles in the baseline to 8.8 miles. This
occurs because the bid-rent curve steepens substantially, as depicted in
Fig. 1. In the open city model, shown in Table 4 column 3, the number
of households increases by 65%–743,000, which is larger than the Basic
30
For a complete set of gradients for both open and closed cities, see
Appendix Figs. A.1–A.4.
31
Other gradients behave predictably, including a rotation in the land and
house price gradients, increase in commuting times, and a decrease in structure
density per unit of built-up land area.
10
Regional Science and Urban Economics 81 (2020) 103484
AV simulation and reflects the greater utility in the closed city. This
indicates households are better off under an AV scenario where CBD
parking is eliminated, even though cars must now travel home during
the day to park. Because of this extra marginal cost of distance, the resi-
dential bid-rent curve steepens substantially, and the city radius shrinks
from 9.6 miles in the baseline to 9.4 miles despite the much larger pop-
ulation. Under this model, both the open and closed city results suggest
owner occupied AVs make the city smaller.
5.3. City 3 results; autonomous taxis
Finally, we examine commuter vehicles that are autonomous taxis
instead of owner-occupied vehicles. This frees both CBD land for addi-
tional production, and residential land for additional housing. In the
closed city, the city radius falls from 9.6 miles in the baseline to 9.2
miles, as seen in Table 3 column 4. While the bid-rent curve flattens in
Fig. 1, more land is available for housing so the city radius still shrinks.
In the open city, as shown in Table 4 column 4, the population is higher
than in any previous open-city model, with 1.16 million households, an
increase of about 150%. Even with this dramatic increase in the popu-
lation, the city only sprawls an additional 0.3 miles relative to the base-
line. This is reflected by a large increase in density, from about 1600
households per square mile in the baseline to 3800 in the open-city sce-
nario. Accordingly, while about 19% of all households occupy units in
5 + unit structures, this changes to about 66% in the AV scenario with
autonomous taxis in an open city.
To summarize the results: 1) AVs increase welfare in all models con-
sidered, as reflected directly by utility increases for closed city solu-
tions, and population increases for open cities; 2) when AVs are imple-
mented alone with no changes to parking behavior, additional sprawl is
the result; 3) when technology permits parking land reallocation from
parking to goods production, sprawl decreases slightly; 4) the introduc-
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Table 3
Baseline and closed city model solutions.
Model [1] [2] [3] [4]
City Name Baseline Basic AV (1) No CBD Parking (2) Autonomous Taxis (3)
Assumptions
Day Parking Land CBD CBD Home None
Night Parking Land Home Home Home None
Time-Cost of Commuting (x Wage) 0.50 0.30 0.30 0.30
Urban Form
Total Occupied Units 450,000 450,000 450,000 450,000
Lot Size (acres, detached avg) 0.15 0.17 0.16 0.21
Unit Size (Sq. ft. avg.) 1520 1578 1656 2059
Residential Struct./Land ratio (CBD) 1.40 1.06 1.73 1.73
Residential Density (hh per sq. mile) 1571 1262 1874 1713
Time to work (avg) 20.1 21.0 19.4 19.6
Fraction housed in 1 unit structures 65% 78% 48% 49%
Fraction housed in 2–4 unit structures 17% 15% 16% 15%
Fraction housed in 5 + unit structures 19% 7% 37% 35%

House Prices
House Price per Sq. Ft. (CBD) 15.17 14.72 15.21 12.33
House Price per Sq. Ft. (avg) 13.88 13.66 13.90 11.33

Land Use
City Radius (assuming circle) 9.6 10.7 8.8 9.2
City Area (sq. miles) 289.5 359.7 243.3 265.9
Area (Production) 1.7 1.7 2.5 2.5
Area (Residential) 80.6 101.0 68.7 92.0
Area (CBD Parking) 0.8 0.8 0.0 0.0
Area (Residential Parking) 19.6 23.8 15.3 0.0

Expenditure Accounting
Income per household $ 49,868 $ 49,868 $ 52,259 $ 52,259
Numeraire Expenditure $ 23,472 $ 22,898 $ 24,312 $ 25,195
Housing Services Expenditure $ 21,098 $ 21,542 $ 23,021 $ 23,331
Commuting Expenditure $ 5298 $ 5427 $ 4926 $ 3734

Energy Consumption per Household (million BTUs)

Total 524.2 530.0 563.7 543.5
Commuting 24.7 31.9 72.5 56.0
Dwelling 142.6 144.8 128.5 126.1
Numeraire 356.9 353.3 362.7 361.5

Welfare Accounting
Utility 2549 2626 2777 3194

tion of autonomous taxi technology has an ambiguous sprawl effect,
with the open city showing an increase due to in-migration and the
closed city showing a decrease.32
These results imply the effects of AVs on the urban form of the city
depend on the manner in which AV technology is implemented. The
area of the land used by the city depends on the ability of the city
to adjust land use patterns to changes in demand for parking, and the
extent to which cities grow in response to the introduction AV cars.
This includes cities for a given size class, as given by the closed-city
models, and for cities with in-migration in response to AVs, as given by
the open-city models.
6. Autonomous vehicles and energy consumption
The second question we wish to consider, using the solutions in
Tables 3 and 4, is the issue of energy consumption and whether
autonomous vehicles save energy. One factor influencing the result
is how the introduction of AVs affects the relative prices of housing,
commuting, and the numeraire good, and how these changing relative
prices affect energy consumption vis a vis expenditures. Additionally,
there are two channels in the model that increase incomes. First, CBD
32
These results are robust to alternative parameterizations of 𝜏 found in the
Appendix, including the ambiguity of the sprawl effect under the autonomous
taxi scenario.
land that is repurposed from parking to production increases the wage
rate through an increase in the land endowment and the marginal prod-
uct of labor. Second, the production function has increasing returns in
labor inputs, so in the open-city renditions of the model, population and
incomes are endogenous and positively related.33
6.1. City 1 results; basic autonomous vehicles
Expenditure substitution is best illustrated by closed-city version of
the Basic AV model (Table 3, column 2). In this model, income is the
same as the baseline model because population and the land endow-
ment are identical. Effects on energy consumption are therefore due to
substitution prompted by changes in relative prices and a small income
effect from a change in the average price level for the expenditure bas-
ket. In this model, household energy consumed while commuting rises
from about 25 million BTUs (mmBTU) annually to about 27 million
BTUs. This occurs due to the suburbanization of households and the
associated longer average commute, which rises from about 20 min to
33
It should be noted from the outset that we only consider energy consumed
by households through their dwellings, commuting, and numeraire consump-
tion. However, this still provides a relatively complete picture of energy con-
sumption through energy intensity multipliers described in Section 3.4, which
account for all energy embodied in all stages of production, transportation, and
consumption.

11
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Table 4
Baseline and open city model solutions.
Model [1] [2] [3] [4]
City Name Baseline Basic AV (1) No CBD Parking (2) Autonomous Taxis (3)
Assumptions
Day Parking Land CBD CBD Home None
Night Parking Land Home Home Home None
Time-Cost of Commuting (x Wage) 0.50 0.30 0.30 0.30
Urban Form
Total Occupied Units 450,000 564,855 743,483 1,162,530
Lot Size (acres, detached avg) 0.15 0.16 0.14 0.16
Unit Size (Sq. ft. avg.) 1520 1524 1496 1612
Residential Struct./Land ratio (CBD) 1.40 1.30 2.80 5.86
Residential Density (hh per sq. mile) 1571 1419 2709 3815
Time to work (avg) 20.1 28.1 38.9 77.3
Fraction housed in 1 unit structures 65% 70% 34% 24%
Fraction housed in 2–4 unit structures 17% 17% 12% 10%
Fraction housed in 5 + unit structures 19% 13% 54% 66%

House Prices
House Price per Sq. Ft. (CBD) 15.17 15.08 16.35 14.24
House Price per Sq. Ft. (avg) 13.88 13.84 14.50 11.90

Land Use
City Radius (assuming circle) 9.6 11.3 9.4 9.9
City Area (sq. miles) 289.5 401.1 277.6 307.9
Area (Production) 1.7 1.7 2.5 2.5
Area (Residential) 80.6 112.1 77.1 106.7
Area (CBD Parking) 0.8 0.8 0.0 0.0
Area (Residential Parking) 19.6 27.3 19.0 0.0

Expenditure Accounting
Income per household $ 49,868 $ 49,585 $ 51,607 $ 51,034
Numeraire Expenditure $ 23,472 $ 22,926 $ 24,318 $ 24,540
Housing Services Expenditure $ 21,098 $ 21,085 $ 21,701 $ 19,179
Commuting Expenditure $ 5298 $ 5574 $ 5589 $ 7315

Energy Consumption per Household (million BTUs)

Total 524.2 531.4 556.2 544.5
Commuting 24.7 26.7 46.3 23.5
Dwelling 142.6 148.6 138.5 146.3
Numeraire 356.9 356.0 371.3 374.6

Welfare Accounting
Utility 2549 2549 2548 2549

21 min per trip. Due to greater suburbanization, congestion at each
radius increases, reducing the speed and fuel economy of each vehicle
as it passes through each successive annulus on the way to the CBD.
The greater suburbanization has an additional effect on housing con-
sumption. Because the average rental price per unit of housing in the
city falls, from about $13.9 per year in the baseline model to $13.7
in the Basic AV model, average housing consumption increases from
about 1520 square feet per household to 1580 per household. Also,
the average structure type changes, from 64% single-family detached
in the baseline to 78% in the AV scenario. Due to both of these factors,
dwelling energy consumption rises from 143 mmBTUs to 149 mmB-
TUs, nearly 3 times the direct effect from commuting alone (2 = 27-25
mmBTUs).
Because house prices fall relative to the numeraire good, the substi-
tution effect causes a reduction in numeraire good consumption and
its associated energy consumption. The income effect slightly coun-
ters this, but on a net basis, the effect of the fall in house prices is a
reduction in numeraire goods consumption, from 357 mmBTUs to 356
mmBTUs. Overall, when considering all three consumption categories,
annual household energy consumption rises by about 7 mmBTUs after
the introduction of AVs, or about 1.3%.34
The effect on energy consumption in the open city version of the
model (Table 4, column 2) is slightly lower than in the closed city
model, though there are a variety of mostly offsetting factors that
must be considered. In addition to the substitution and income effects
increasing energy consumption, there is also additional population due
to the regional equilibrium condition. This increases productivity due
to agglomeration economies. However, in order to achieve the regional
utility, population rises to the point where the wage rate is actually
below the baseline—even with agglomeration—due to the benefits of
AVs. Finally, due to the greater population and higher transportation
and housing costs at each radius, housing consumption falls and struc-
ture density rises. Thus, there are both positive and negative effects
of AVs on household energy consumption when population is endoge-
nous. Overall, commuting energy consumption rises by more than in
the closed-city model, housing energy consumption rises by less, and
numeraire energy consumption falls by more. The net effect is a slightly
lower increase in household energy consumption, from 524 mmBTU in
the baseline, to 530 mmBTU in the open city vs 531 mmBTU in the
closed city.

34
It should be noted that this AV effect is purely a commuting effect. The
reduction in marginal transportation effects may change non-commuting travel
behavior as well, including shopping, school, etc. Thus, our model gives, per-
haps, a lower bound because we do not consider other means of adjustment.

12
W. Larson, W. Zhao
6.2. City 2 results; No CBD commuter parking
The city with no CBD commuter parking also has increased house-
hold energy consumption for both closed-city and open-city versions
(Table 3, column 3 and Table 4, column 3, respectively). After driving
the commuter to the CBD, the vehicle returns to the place of residence
to park for the day. Then before the end of the work day, returns to the
CBD to pick up the worker for the return trip. These additional trips
add substantial energy consumption and steepen the bid-rent curve.
Additionally, the land that used to be CBD parking in the baseline
model is now allocated to goods production, increasing earnings from
about $49,900 per year to about $52,300 per year (closed city) and
$51,600 (open city). This additional income is spent on expenditures
which embody energy.
This model shows reduced energy consumption in dwellings. The
price of housing increases from $13.88 per square foot in the baseline
to $13.90 (closed city) and $14.50 (open city). When combined with the
additional income, consumption increases from about 1520 square feet
in the baseline to 1660 in the closed city, but falls to 1500 in the open
city. These dwellings exist in more efficient multi-unit structures, caus-
ing a drop in dwelling energy consumption overall, with 143 mmBTU
in the baseline falling to 139 mmBTU (closed city) and 129 mmBTU
(open city).
Offsetting this reduction, the model result is an increase in energy
consumption in both commuting and numeraire good consumption.
While relative prices change slightly, the additional income creates
substantial additional demand for the numeraire good, with embod-
ied energy consumption rising from 357 mmBTU in the baseline to 371
mmBTU (closed city) and 363 mmBTU (open city). Due to the addi-
tional vehicle trips to park at the place of residence, commuting energy
consumption rises from 25 mmBTU to 46 mmBTU (closed city) and
72.5 mmBTU (open city). In the closed city, the effect of doubling the
number of trips is less than double of that on energy because of the
reduction in sprawl, whereas in the open city, the effect is more than
twice the baseline because of the additional population and congestion.
Overall, in this model, energy consumption summed over the three cat-
egories increases, from 524 mmBTU in the baseline to 556 mmBTU
(closed city) and 564 mmBTU (open city), for a 6.1% and 7.6% increase,
respectively.
6.3. City 3 results; autonomous taxis
The city with autonomous taxis has energy consumption patterns
that fall in between the Basic AV model and the scenario with no CBD
commuter parking. For autonomous taxis relative to owner occupied
vehicles, marginal pecuniary commuting costs are higher and fixed
commuting costs are lower. This rotates the bid-rent curve relative to
the previous models. Because parking land in the residential district is
no longer required for commuters, the land available for housing con-
struction increases substantially. This effect reduces the price of land,
which has a host of effects on patterns of housing consumption in the
closed city. A lower land price reduces the price of housing, which both
reduces the amount of structure produced on each unit of land and
increases housing consumption. But because there is more land avail-
able, population per annulus actually rises, implying a larger number
of lower-density homes per square mile. Combined with the rotation in
the bid-rent curve, the autonomous taxi model has dramatically higher
population density in both cities, increasing from 1571 housing units
per square mile in baseline model to 1713 (closed city) and 3814 (open
city). The housing unit size effect dominates in the closed city, increas-
ing energy consumption from 143 mmBTUs in the baseline to 146 mmB-
TUs, while the density effect dominates in the open city, decreasing
energy consumption to 126 mmBTUs.
Commuting energy consumption falls in the closed city model to
24 mmBTU from the baseline value of 25 mmBTU because the city
becomes more compact with a constant population. With the higher
13
Regional Science and Urban Economics 81 (2020) 103484
population of the open city, energy consumed commuting increases
to 56 mmBTU. In autonomous taxis, commuters are willing to bear
extremely long commutes in the open city, with the average commute
stretching to 77 min per one-way trip, relative to 20 min in the baseline.
As the city area increases only modestly, this increase in commuting
time can be attributed to additional traffic congestion.
Numeraire energy consumption rises substantially in both scenarios,
from 356 mmBTU in the baseline to 575 mmBTUs (closed city) and 362
mmBTUs (open city), respectively. This is due to an effect of rising
incomes that is partially offset by an increase in the relative price of
the numeraire good. Overall, total energy consumption per household
increases from 524 mmBTUs in the baseline to 545 in the closed city
and 544 mmBTU in the open city, for increase in energy consumption
of 3.9% and 3.7%, respectively.
Across all simulations, energy consumption increases. This is due
to greater labor productivity, and depending on the model, greater
housing consumption, a larger number of trips, and/or more congested
roads. While autonomous vehicles may reduce energy consumption in
some sectors (commuting, housing, or numeraire consumption), when
summed, the model result is an increase in total energy consumption in
every case.
7. Autonomous vehicles and housing affordability
The final issue we address with our series of models is the effect of
autonomous vehicles on housing affordability. By reducing commuting
costs, AVs increase CBD accessibility; and by reducing the land nec-
essary for parking, AVs increase the land available for housing con-
struction in currently built-up areas. Both effects increase housing sup-
ply, making housing more affordable in partial equilibrium. However,
when moving to a general equilibrium analysis, the models we have
developed suggest that AVs increase housing affordability in many but
not all cases. In this section, the key variable of interest is the average
house price per square foot across the city. Lower values relative to the
baseline are interpreted as an increase in housing affordability, even if
the average unit size rises making the total expenditure on each housing
unit higher.
7.1. City 1 results; basic autonomous vehicles
As with the other sections, the model that gives the pure trans-
portation cost effect is the Basic AV simulation under the closed-city
model closing condition. This model holds population, income, and
CBD parking land use constant, and therefore focuses exclusively on
the accessibility effects of AVs on affordability. Because transportation
costs fall, the price falls from an average price of $13.9 in the base-
line model to $13.7 in the Basic AV model. For a city that introduces
AVs and then grows in a response, we turn to the open-city rendition
of the model. In this city, the population increases, but housing still
becomes slightly more affordable, with average house prices falling
from $13.9 (baseline) to $13.8. Overall, AVs and the associated trans-
portation cost reduction increases housing affordability, even when it
causes an increase to the city size.
7.2. City 2 results; No CBD commuter parking
With owner-occupied vehicles, when CBD parking land is reallo-
cated to goods production and the vehicle makes the additional two
trips each day, the effect on housing affordability is ambiguous. In the
closed city, the house prices rise slightly ($0.02 per square foot) but
incomes rise by 4.8%, from about $49,900 to $52,300. Because incomes
rise faster than housing costs, we conclude that housing is more afford-
able in this city than in the baseline. On the other hand, in the open city,
the population is much larger, with lower incomes and higher house
prices. In this case, housing is less affordable. We therefore conclude
W. Larson, W. Zhao
that the effect of this scenario on housing affordability is ambiguous,
a finding reinforced by the alternative parameterizations shown in the
Appendix.
7.3. City 3 results; autonomous taxis
Autonomous taxis dramatically increase housing affordability.
Because AV cars both make accessible more land area proximate to
the city and increase the land available to housing in the residential
district, the land price falls. Because the land price falls, so too does the
house price. In the closed city, the average house price falls from $13.9
per square foot to $11.3 in the closed city model and $11.9 in the open
city model. It is remarkable that the open city has 250% the popula-
tion of the baseline city, yet is physically smaller with lower housing
costs.
Overall, in 5 of the 6 models considered, housing becomes more
affordable, while in 1 of the 6, it becomes more expensive. Generally,
house prices fall because more land area in the city is accessible to
development, either through a reduction in commuting costs or because
land for parking is reclaimed for other uses. In the model where house
prices rise, the cause is the dramatic influx of people into the city. In
all models, however, the introduction of AVs results in greater utility,
as demonstrated through the higher utility level in the closed cities and
the higher population in the open cities.
8. Conclusion
In this paper, we have presented a rendition of the canonical mono-
centricy city model and solved this model under assumptions that emu-
late the introduction of autonomous vehicles (AVs). Long-run solutions
to this model are then used to address three salient questions: will
AVs cause cities to sprawl or become more compact; will AVs increase
or decrease household energy consumption; and, will AVs make hous-
ing more expensive or more affordable? Three alternative technologies
under which AVs may operate are considered.
AV cars have an uncertain effect on the urban form of the city. The
direct effect of AVs clearly increases sprawl, and this effect dominates
in some models. But the indirect effects of reduced land for parking act
as forces making the city more compact. The net result is dependent on
the particular implementation of AVs in the city, whether parking land
can be reclaimed for other uses, and if AVs induce in-migration.
Predictions involving energy consumption are much clearer. In all
model cities, energy consumption is higher compared to the current
baseline city. Energy consumption embodied in commuting, housing
consumption, or numerare consumption may rise or fall, but on a net
14
Regional Science and Urban Economics 81 (2020) 103484
basis, it always rises. This is the case for cities within a size class (i.e.
holding population constant) or in a regional equilibrium where the city
population increases in response to the introduction of AV cars.
Finally, housing becomes more affordable in most of the model
cities. The mechanism for the increase in housing affordability is an
increase in the effective land supply brought about by 1) greater acces-
sibility of land far from the CBD due to falling transportation costs, and
2) more available land within the city due to lower demand for park-
ing. Lower commuting and housing costs give rise to substantial utility
increases in all AV scenarios considered.
The approach we have taken in this paper is different than prior
work in several ways. First, engineering studies do not tend to incorpo-
rate the dynamic response of households and firms to the fall in trans-
portation costs and reduction in parking demand, and thus overstate the
effects of AVs on reductions to energy consumption. Second, empirical
studies are hampered by the fact that data do not exist on the adop-
tion of AVs—AVs are, after all, a nascent technology. Finally, previous
models of the city tend to present a single view of how a city responds
to the introduction of AVs. In the present paper, we consider a variety
of dimensions across which the city may or may not adjust, including
changes to population, reduction to demand for center-city and resi-
dential parking, and whether commuter vehicles are owner-occupied.
In sum, our paper is the first to consider these combined margins for
adjustment in a general equilibrium framework.
Despite the progress made here, there are several ways in which the
model could be improved in future research. We only consider auto-
mobile commuters. In reality, workers have a rich variety of modal
choice available, including walking, subway, light rail, buses, or tele-
work (Borck and Brueckner, 2018). The open-city models assume a
fixed regional utility. In reality, other cities’ utility will also rise were
AVs to be introduced in those cities as well. Even in cities that do
not face congestion, there will still be benefits, even if they are small.
Modeling a true system of cities, similar to Rappaport (2016) would
be an excellent next step. Finally, other coincident technologies could
be considered, including electric cars, and there may be interactions
with regulations such as historic designations (density cannot increase
optimally) or greenbelts (density is forced). As this research shows, the
monocentric city model is a flexible platform on which to examine such
issues.
Acknowledgments
The authors would like to thank seminar participants at the AREUEA
national meetings and the University of Louisville, Tony Yezer, Jan
Brueckner, Jordan Rappaport, our editor Jeff Lin, and anonymous ref-
erees for valuable advice and feedback.
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Appendix A.

A.1. Appendix figures

Fig. A.1 Autonomous Vehicles and Urban Gradients (Closed City).

15
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Fig. A.2 Autonomous Vehicles and Energy Gradients (Closed City).

16
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Fig. A.3 Autonomous Vehicles and Urban Gradients (Open City).

17
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

Fig. A.4 Autonomous Vehicles and Energy Gradients (Open City).

18
W. Larson, W. Zhao Regional Science and Urban Economics 81 (2020) 103484

A.2. Appendix tables

Table A.1
CBD radius (kCBD ) robustness.
CBD Radius House Price City Radius Energy Per Capita
Baseline 0.75 Miles 13.85 9.75 522.49
1 Mile∗ 13.90 9.60 524.16
1.5 Miles 13.98 9.60 527.17

%Δ relative to Baseline at same CBD Radius

Basic AV 0.75 Miles −1.72% 9.23% 1.35%
1 Mile∗ −1.92% 11.46% 1.39%
1.5 Miles −2.16% 11.46% 1.45%

No CBD Parking 0.75 Miles 0.28% −8.21% 5.68%

1 Mile∗ 0.15% −8.33% 6.11%
1.5 Miles −0.17% −7.29% 7.03%

Autonomous Taxis 0.75 Miles −18.29% −5.13% 3.87%

1 Mile∗ −18.58% −4.17% 3.89%
1.5 Miles −19.05% −5.21% 3.98%
Note: ∗ indicates original parameter value in Tables 2–4. Each model is solved under closed-city assump-
tions.

Table A.2
Time-cost of commuting (𝜏 ) robustness.
Time-Cost Fraction House Price City Radius Energy Per Capita
Baseline 0.50∗ 13.90 9.60 524.16

%Δ relative to Baseline
Basic AV 0.10 −3.86% 23.96% 2.69%
0.20 −2.86% 16.67% 2.08%
0.30∗ −1.92% 11.46% 1.39%
0.40 −0.98% 6.25% 0.68%

No CBD Parking 0.10 −1.50% 0.00% 7.43%

0.20 −0.51% −7.29% 6.63%
0.30∗ 0.15% −8.33% 6.11%
0.40 0.87% −10.42% 5.58%

Autonomous Taxis 0.10 −19.46% 3.13% 5.13%

0.20 −19.03% 0.00% 4.53%
0.30∗ −18.58% −4.17% 3.89%
0.40 −18.13% −8.33% 3.38%
Note: ∗ indicates original parameter value in Tables 2–4. Each model is solved under closed-city assumptions.

Table A.3
Autonomous taxi (𝜑0 , 𝜑1 , 𝜑2 ) robustness.
Pecuniary Costs House Price City Radius Energy Per Capita
Baseline See Text∗ 13.90 9.60 524.16

%Δ relative to Baseline
Autonomous Taxis −20% −19.44% 3.13% 5.77%
See Text∗ −18.58% −4.17% 3.89%
+20% −17.76% −11.46% 3.65%
Note: ∗ indicates original parameter value in Tables 2–4. Each model is solved under closed-city assumptions.

Appendix B. Supplementary data

Supplementary data to this article can be found online at https://doi.org/10.1016/j.regsciurbeco.2019.103484.

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