Relationships Between Urban Density, Travel, and Business Productivity in the European Countries: Empirical Evidence and Its Policy Implications for Spatial Planning and Design

Relationships Between Urban Density, Travel, and Business Productivity in the European Countries: Empirical Evidence and Its Policy Implications for Spatial Planning and Design


Y Jin, Cambridge University, UK


We analyse effects of agglomeration & travel upon business productivity through studying correlations, mechanisms & microscopic examples, & examine design solutions that can harness the drive for productivity in low-carbon retrofit of key urban nodes


Recent academic and policy studies in many developed countries have in various ways indicated that there is an enormous challenge in reducing the carbon emissions that arise from transport and the wider built environment. Meeting the national level carbon budget (where there is one, legal or aspirational) in most cases requires a step change relative to the slow progress in recent years. Such a step change would require significant investment. In turn, the investment required ultimately has to be funded through improved productivity. It thus makes sense in policy research to examine how transport and land use planning measures impact upon business productivity, and to seek innovative design solutions that can raise business productivity whilst reducing carbon emissions and other environmental impacts.

The theoretical insights into the effects of business agglomeration upon productivity can be traced back to the beginning of neoclassical economics in the late 19th Century. However, practical analysis of such effects for policy purposes has only become possible very recently, thanks to the theoretical advancements made since the late 1970s in New Economic Geography, and the growing volume of empirical work in this field in the last 10 years.

This paper reports new research findings from a UK EPSRC Energy Efficient Cities project that examine the relationships between business productivity, travel patterns, and urban activity density in the European countries. Urban activity density is a short hand for densities of business activities (defined by different classes of outputs and jobs), of residential activities (defined by different classes of households and individuals), and of ancillary land uses.

The paper first gathers together and analyses the empirical evidence in terms of (1) correlations between the relevant variables at the level of city regions, (2) key mechanisms that are thought to have generated the correlations, and (3) microscopic examples in the built environment that serve to illustrate the functioning of the mechanisms. In particular, the business agglomeration effects that arise from high levels of urban activity density and fast transport links are analysed in detail using existing empirical evidence from the UK and the author?s own analysis of the firm?s production functions in Southern England using data extracted from the firm-level financial database FAME together with transport and residential activity data in the related labour market catchment.

The insights gained from the analysis above are then used in the paper to consider possible activity layout and urban design prototypes that could facilitate productivity improvements whilst reducing carbon emissions from transport and the wider built environment. In particular, different activity layout and urban design solutions of similar area-wide densities are tested through an activity and travel simulation model. The analysis aims to inform the retrofitting of cities in the developed world where the rate of change in the physical built environment is commonly slow. It explores the ways in which the drive to improve business productivity can be harnessed as a positive force for retrofitting key urban nodes in a way that contributes to a step change towards a low carbon future. The paper then considers the policy implications in transport, spatial planning and urban design.


Association for European Transport