Amenity changes,property values,and hedonic prices in a closed city

The effects of changes in amenity levels on the bid prices for land and on the marginal worth of an amenity are examined. The vehicle for analysis is a closed-city urban spatial model containing an explicit utility function and explicitly specified, spatial distributions of amenities. Issues addressed include the behavior of bid price (and property value) schedules in response to amenity changes; the impact of such changes on the utility of renters, under conditions of both identical and disparate tastes; the effect of amenity changes on the amenity's schedule of marginal worth; and the relation of such a schedule in a closed city to that in an open city.