Evolution of Urban Economics:A Review of Theory and Empirical Methods
China's economy is moving forward and striving for high-quality development,and clarifying the evolu-tion of urban economics is essential to grasping the logic of urban development and telling China's story.In reality,sev-eral cutting-edge issues in urban economics have emerged,such as the transformation of urban spatial structure from monocentric to polycentric pattern,the industrial division of labor and functional positioning across large,medium,and small cities,and the sorting and selecting effects of heterogeneous agents(labor,enterprises,and industries)among dif-ferent cities.Existing theories have not provided effective support or perfect explanations for these new phenomena.Reviewing the evolution of urban economics,this paper finds that spatial general equilibrium models have delved deeper,but there are still problems of overly rigid assumptions,an inability to effectively respond to reality,and a lack of complementarity between theory and reality.Specifically,urban economics has evolved from the Alonso-Mills-Muth(AMM)model to the Rosen-Roback model,and then to heterogeneous agents'agglomeration and quantitative spatial equilibrium models,consistently focusing on the spatial agglomeration of cities,and studying the flows and distribution of people and economic activities among cities.A series of frontier issues in urban studies have emerged.Therefore,to relax the assumptions of homogenous space,transportation costs,and competitive equilibrium,more reasonably explain the lo-cation choices of urban micro-agents,and apply more scientific methods to study diversified real-world problems,this pa-per summarizes the latest theories and methods in urban economics and looks ahead to future research directions.This paper focuses on four major frontier issues in urban economics.The first is the evolution of spatial structure within cities.In existing literature,measuring spatial structures based on the flow of factors like population or land serves as a re-search foundation,and the comprehensive analysis of the functional connections of units and their corresponding economic performance is the focus.The second is the division of labor and equilibrium among cities.Early studies mainly focused on measuring and evaluating urban size distribution,and then turned to the evolution of industrial specialization and the eco-nomic performance of intercity knowledge exchange among cities.The third is the heterogeneous agglomeration pattern.Heterogeneous agglomeration theory attaches importance to the spatial links among micro-agents with different characteris-tics,providing a micro-framework and new mechanisms to study the distribution and evolution of public service facilities,housing rents,labor,etc.within cities.The fourth is the quantitative spatial equilibrium analysis.As micro-level traffic net-work data becomes more widespread,the quantitative equilibrium analysis has gained prominence in urban and regional eco-nomics,involving topics like labor mobility,enterprise location,and infrastructure construction.Based on this,this paper provides an application example by constructing a model to determine city equilibrium size and conducting counterfactual analyses using China's urban data.In the future,using micro-level big data to study relevant topics may be indispensable for telling a good story with Chinese characteristics.These research topics include but are not limited to the following.(1)Expanding on the findings related to the impact of new information and communication technologies,such as telecommuting,on urban spatial struc-ture.Telecommuting can significantly impact the patterns of labor agglomeration,and follow-up studies can consider the effect of telecommuting on labor commuting and introduce the differences in the efficiency of firms utilizing telecommut-ing to examine the changes in urban land rent curves.(2)Reinforcing the analysis of the impact of enterprise dynamics and innovation clusters on urban functional division and urban size.Further research can introduce the impacts of labor dy-namics and knowledge accumulation on firms'production to explain the evolution of the functional division of labor among cities.(3)Strengthening the study of the relationship between heterogeneous labor mobility and public product supply in the context of metropolitan areas(urban clusters)integration.The development of public service networks can attract labor force inflows,especially in small and medium-sized cities with well-developed transportation networks and desirable living conditions within metropolitan areas.Future research directions may involve constructing efficient inter-city public service supply networks to promote coordinated regional development.
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