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A "Bid-Price Curve": A set of combinations of land prices and distances among which the individual is indifferent. It shows the land rent the household could pay at each distance in order to achieve a predetermined utility level (thus there is a bid price curve for every utility level). The bid price function answers the question: As the individual considers residential locations at different locations in the city, i.e. at increasing distances from the city center, what price of land would allow her to buy sufficient amount of land (and other goods) to enjoy as much satisfaction as a given (starting) price (and amount of land) at the city center.
The residential bid price curve is "the set of prices for land the
individual could pay at various distances while deriving a constant level
of satisfaction." (p.59)
Alonso stresses three points in his characterization of the bid price curve:
The bid price function for the urban firm would be defined as follows: It describes the prices which the firm is willing to pay at different locations (distances from the city center) in order to achieve a certain level of profits.
Alonso, William (1933-1999)
Other Literature (related to Alonso urban land-use work):
Harrison S. Campbell, Jr., Bid Rent and Location Gradients: The Importance of Relative Location
Egan DJ, Nield K., Towards a theory of intraurban hotel location, URBAN STUDIES 37 (3): 611-621 MAR 2000 Times Cited: 0
Workers trade long commutes for less expensive housing Seattle Times, Tuesday, May 28, 2002 [incl. by county commuting times data]By Rebecca Cook