The Effects of Inequality, Density, and Heterogeneous Residential Preferences on Urban Displacement and Metropolitan Structure: An Agent-Based Model

TL;DR

This paper introduces an agent-based model to explore how inequality, density, and diverse preferences influence urban displacement and gentrification, revealing complex dynamics of settlement growth and resident displacement.

Contribution

It presents a novel agent-based simulation capturing the interplay of socioeconomic factors and amenities in urban displacement and structure formation.

Findings

Displacement occurs as land values rise with densification.

High-income residents tend to cluster around amenities regardless of direct use.

Urban displacement dynamics are sensitive to inequality and amenity preferences.

Abstract

Urban displacement - when a household is forced to relocate due to conditions affecting its home or surroundings - often results from rising housing costs, particularly in wealthy, prosperous cities. However, its dynamics are complex and often difficult to understand. This paper presents an agent-based model of urban settlement, agglomeration, displacement, and sprawl. New settlements form around a spatial amenity that draws initial, poor settlers to subsist on the resource. As the settlement grows, subsequent settlers of varying income, skills, and interests are heterogeneously drawn to either the original amenity or to the emerging human agglomeration. As this agglomeration grows and densifies, land values increase, and the initial poor settlers are displaced from the spatial amenity on which they relied. Through path dependence, high-income residents remain clustered around this original amenity for which they have no direct use or interest. This toy model explores these dynamics, demonstrating a simplified mechanism of how urban displacement and gentrification can be sensitive to income inequality, density, and varied preferences for different types of amenities.

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