This course introduces the fundamental theories of how space matters for economic activities. It introduces the fundamental theories of urban and regional economics and covers the newest development in quantitative spatial economics.

There will be lecture slides for all the topics. In the following list, *denotes essential readings, and those without * means they are supplementary. Our materials focus on fundamental theories in urban and regional economics, as well as quantitative spatial economics. We will also review some important development in the empirical literature. Most of the materials are based on important research papers. We will use a few chapters from an undergraduate textbook for urban economics -- Brueckner, Jan (2011), Lectures on Urban Economics, MIT Press.

Topic 1: Introduction to “Cities”
• *Chapter 1, Brueckner’s textbook
• Rozenfeld, Hernan, Diego Rybski, Xavier Gabaix and Hernan Makse. 2011. “The area and
population of cities: New insights from a different perspective on cities,” American Economic
Review 101(5): 2205-2225.

Topic 2: Internal Structure of A City
• *Chapters 2 and 3, Brueckner’s textbook
• R.E. Lucas Jr., E. Rossi-Hansberg (2002), “On the internal structure of cities,” Econometrica,
70(4), pp. 1445-1476.

Topic 3: Urban Transportation
• *Notes
• *Duranton, Gilles, and Matthew A. Turner. (2011). “The fundamental law of road congestion:
Evidence from US cities,” American Economic Review 101(6): 2616-52.
• *Hsu, W. T., & Zhang, H. (2014). “The fundamental law of highway congestion revisited:
Evidence from national expressways in Japan,” Journal of Urban Economics, 81, 65-76.

Topic 4: Local Public Finance; Henry George Theorem
• *Notes
• *Arnott and Stiglitz (1979)

Topic 5: System of Cities; Central Place Theory
• *Salop, Steven C. (1979), “Monopolistic competition with outside goods,” The Bell Journal of Economics: 141-156.
• *Hsu, W.-T., T. J. Holmes and F. Morgan (2014), "Optimal City Hierarchy: A Dynamic Programming Approach to Central Place Theory," Journal of Economic Theory, 154, pp. 245- 273.
• *Hsu, W.-T. (2012), "Central place theory and city size distribution," Economic Journal, 122, pp. 903-932.
• *Mori, T., Smith, T. E., & Hsu, W. T. (2020). “Common power laws for cities and spatial fractal structures,” Proceedings of the National Academy of Sciences, 117(12), 6469-6475.
• Fujita, M., Krugman, P. and Mori, T. (1999), "On the evolution of hierarchical urban systems," European Economic Review, vol. 43, pp. 209–51.

Topic 6: New Economic Geography
• *Krugman, Paul (1991), “Increasing returns and economic geography,” Journal of Political
Economy, 99, pp. 483-499.
• *Helpman, E. (1998), “The size of regions,” in D. Pines, E. Sadka, Y. Zilcha (Eds.), Topics in
Public Economics, Cambridge University Press, New York, pp. 33-54.
• *Murata, Yasusada (2003). “Product diversity, taste heterogeneity, and geographic distribution of economic activities: market vs. non-market interactions,” Journal of Urban Economics 53.1: 126-144.
• Redding, Stephen and Daniel Sturm. 2008. “The costs of remoteness: Evidence from German division and reunification.” American Economic Review 98(5): 1766-1797.
• Fujita, Krugman, and Venables (1999), The Spatial Economy, MIT Press.

Topic 7: Quantitative Spatial Economics
• *Eaton, J., & Kortum, S. (2002). “Technology, Geography, and Trade,” Econometrica, 70(5), 1741-1779.
• *Allen, T., & Arkolakis, C. (2014). “Trade and the Topography of the Spatial Economy.” Quarterly Journal of Economics, 129(3), 1085-1140.
• *Ahlfedlt, Gabriel, Steven Redding, Daniel Sturm and Nikolaus Wolf (2015), “The Economics of Density: Evidence from the Berlin Wall,” Econometrica, 83(6), 2127-2189.
• *Donaldson, D. (2018). Railroads of the Raj: Estimating the impact of transportation infrastructure. American Economic Review, 108(4-5), 899-934.
• *Heblich, S., Redding, S. J., & Sturm, D. M. (2020). “The making of the modern metropolis: evidence from London.” Quarterly Journal of Economics, 135(4), 2059-2133
• Hsieh, Chang-Tai and Enrico Moretti (2019), “Housing Constraints and Spatial Misallocation,” American Economic Journal: Macroeconomics, 11(2), April 2019.