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|Title||Applying Urban Economics to Hong Kong|
|Institution||University of Zurich|
|Faculty||Faculty of Economics, Business Administration and Information Technology|
|Abstract Text||The monocentric model compiled by Alonso (1964), Mills (1967) and Muth (1969) defines commuting costs to a city business district (CBD) to be the sole spatial determinant influencing land rents, housing rents and population densities within cities. This thesis tests the accuracy of the underlying assumptions in the monocentric model by applying the model to Hong Kong. The empirical testing reveals that commuting costs to a CBD have a strong impact on housing prices, whereas the density allocation in Hong Kong cannot be explained comprehensively by the premises of the monocentric model. A Further expansion of the model shows that local amenities slightly affect transaction prices, whereas the distance to the CBD is clearly the dominant spatial variable. In a final step, the observations of the development of the rent and density gradient over time provide ambiguous results.|