Planning the Trajectories of Land and Development Rights Rents via Discrete Programming Models

The Koopmans and Beckmann assignment model approach to problems of urban economics has led to considerable discussion. In our recent papers some of the issues raised were reviewed and also extensions that resolve many of the dilemmas suggested by the original model were proposed. Most of the approaches surveyed in our previous paper make little use of the duality properties of the assignment model. In the present paper it is argued that, under certain circumstances, dual variables interpretable as site rents and other dual variables that suggest the values of transferable development rights (TDRs) appear with model solutions. This view enhances the importance of assignment models to city planners and sheds light on how planners can guide optimal development along with the implementation of TDR policies.