ØKB2113 Urban and regional economics

Course description for academic year 2019/2020

Due to Covid-19, changes may occur in course descriptions for the spring semester of 2020. Changes in each course will be published on Canvas. When a course description has been changed on Canvas, the description on web is no longer valid. Examples of such changes could be accomplishment of practice, course type, or whether letter grades or passed/not passed will be used as grading scales.

Contents and structure

This course begins by discussing how the location decisions of firms depend on transport costs, input prices, market conditions, competition, and access to information. As a natural extension, central place theory is presented, related to a discussion of possible explanations to the emergence of clusters of industrial activities. As a next step, the focus is on bid rent curves, land use, and housing market conditions in urban areas. It is also a central part of the course to discuss the local impact of different kinds of exogenous shocks. This analysis is made within the framework of economic base modeling and regional input-output models. Finally, regional labor market theory and models of spatial interaction are used to analyze spatial disparities in wages, unemployment, migration flows, and population growth. Throughout the course, we make extensive use of case studies from south west Norway.

Learning Outcome


The student:

  • Understands how different factors influence the location decisions of firms.
  • Understands why industrial activities are often clustered, and how geographies are typically organized in a hierarchical order of central places.
  • Is familiar with theories of how different activities typically occupy different areas in an urban area, and how this is related to prices of land.
  • Is familiar with basic models for analyzing the local impact of exogenous shocks.


The student:

  •  Is able to use economic theory to explain patterns of central places, and has a basic understanding of spatial disparities in land and housing prices within a region.
  • Is able to conduct simple analyses of how different kinds of exogenous shocks may affect a region. Such a shock may, for instance, be that a major firm is being closed down or relocated.
  • Is able to do simple analyses of how changes in the transportation infrastructure may affect the location decisions of firms, and the pattern of central places in a region.
  • Has a basic understanding of problems related to spatial disparities in unemployment, employment, and population growth.

General Competence

The student:

  •  Is able to explain the spatial distribution of economic activities in a framework based on a general equilibrium way of thinking.
  • Is equipped, overall, with analytical tools providing a firm understanding of key relationships in the economic policy debate related to urban and regional economics.

Entry requirements


Recommended previous knowledge

Microeconomics and Macroeconomics

Teaching methods

Lectures and working in groups with portfolio.

Course requirements

Yes, the terms may vary from one year to the next, and will be announced when the course starts. Acceptance of the portfolio applies for the present term. Students with accepted portfolio from previous years do a reduced and simplified version of the current portfolio.


Written exam, 4 hours, 100%

Grades A-F

The exam builts on the syllabus and the work done with portifolios.

Examination support material

Elementary calculator

More about examination support material

Course reductions

  • SØ6-2001 (1) - Urban and regional economics - Reduction: 7.5 studypoints