Re-investing in the Built Environment: A Spatial Network Approach

Before launching ambitious and expensive development programmes to induce new regional technology corridors and clusters, it is critical to appreciate existing spatial economic patterns in a region. Initial economic conditions drive location decisions of firms and a labour force such that any changes must intercede onto an existing landscape built for current economic conditions. This work adopts a simple regional economic model to integrate and review traditional and modern urban location theories in order to illustrate the power of initial conditions to determine a final result. A simple spatial dynamic simulation model captures many of the pertinent effects of real estate pricing patterns to frame both opportunities and constraints to re-shape an urban landscape. Attention to 'ground up' spatially correlated location patterns revealed in price data that suggests close attention to strategic zoning can have profound impacts on the success or failure of economic development. Relatively modest policy interventions that carefully utilize existing preferences for urban amenities and concurrent real property investments involve fewer policy risks with potentially more powerful stimulative economic consequences than promised in more ambitious programmes.