FLEXIBLE FORM METHODS FOR MEASURING RENT GRADIENTS

We develop and demonstrate an empirical methodology for measuring rent gradients in the presence of consumers that have varying tastes for distance to the city center. We derive easily calculated measures of rent gradients, own price elasticities, and income elasticities. We demonstrate the ease of calculation of these functions, even in the presence of consumers who have nonidentical preferences. We also demonstrate how to test for bias in rent gradient estimation that arises from assuming identical preference functions.