ECONOMICS Jibgar Joshi

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Syllabus

Basics of Economics: Economics and economic

problems in relations to human settlements; Basic concepts in economics- economic resources and economic concepts of land; Demand and supply; Opportunity or social costs; Internal and external economics and urban growth; Valuation-market structures, equilibrium analysis and price determination; Pricing of public utilities and economic infrastructure- marginal pricing vs. other methods of pricing; Macroeconomic variables; Product and income national, regional and settlement level; Standard of living, PQLI; Economic growth and development of human settlements; Keynesian theory of income determination and Changes in the concept of economic development
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 Economic Principles and Land Use Planning:

Economic principles of land utilization and settlement development, Economic rent of land and values and land use patterns Locational economics: factors influencing locational decisions; Analysis and location of specific land uses such as industrial, residential etc.

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Introduction

Anthropocentric Human behavior to satisfy/achieve ends with the use

of means Science of scarcity Optimum utilization of scarce resources to produce the best combinations of goods and services that most satisfies human wants, needs and aspirations

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Definitions Scarcity is a situation in which there is not enough of a resource to meet all of peoples wants and needs. Resources are said to be scarce when people do not have enough of them to meet their wants and needs. Everyone faces the problem of scarcity. Economics is the study of the choices people make and the actions they take in order to make the best use of scarce resources in meeting their wants and needs. Economics studies the allocation of scarce resources in society as a means of satisfying human needs, wants and desires. In doing so, it takes into account the availability of resources, methods for the production of goods and services, their exchange and the distribution of income within society. Economics is anthropocentric and as such provides useful tools that can support decision making. Economics defines the conditions required to secure the most efficient allocation of scarce resources in a variety 5/8/2013 5 of contexts.

Human settlements

Settlements of any size from a small rural town to a

mega polis Ever-increasing population pressure The rapid change in the nature of needs and wants Declining ability to produce goods and services Exclusion of a large number of the poor Inequitable access of the poor to urban goods and services Key concern: Production and distribution of urban goods and services

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Human settlements development

In order to raise the living standards of all the people in our town (impact), we aim at the sustainable provision of safe, reliable and affordable goods and services for all (community, business, and the government) (outcomes) with the construction and production of infrastructure and services (outputs) through the implementation of the projects and programs (activities) and through decentralization and divestment and other appropriate strategies (strategic interventions) by deploying, mobilizing and managing (process) land, capital, and labor (inputs) owned by the community, business and the government (stakeholders). 5/8/2013 7

Micro and Macro-economics

Microeconomics is the branch of economics that

deals with the choices and actions of small economic units. Macroeconomics is the branch of economics that deals with large-scale economic phenomena such as national income, inflation, unemployment and economic growth.

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Land

Return due to indestructible and original power of the

soil. The supply of land is fixed. The supply price is zero. The whole of its return is rent.

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Land is seen as both a private and a public good. The use value of land as a private good is obvious. No one can exist without occupying a piece of land; all activities must take place somewhere. To understand the public good manifested in land-use, the following points will be of particular relevance: Except in a marginal sense, land is a permanent asset. Since it cannot be consumed or destroyed, land is passed over to successive generations. Land is also a fixed asset. It cannot be moved around. The use value of land is largely a function of its relative location.

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 Much of the values taken on by land are unearned.

They are the results of public investments in infrastructure and services and various social and economic processes including urbanization. These values can be realized in market exchange. The use of land for any particular function may produce externalities. These affect the use of proximate localities, for instance, pollution and traffic congestion.

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Seminar Topics

Affordability of Apartment Housing and Economics

of Informal Settlements Use of Land Pooling Projects for Enhancing Efficiency and Equity in the Kathmandu Valley Economics of Inclusive Transport Services and Sustainable Urban Mobility Prioritizing Investments for Making Cities more Inclusive

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I.

Affordability of Apartment Housing and Economics of Informal Sector

The purpose is to assess the affordability of AH and suggest ways and means of making it more affordable while integrating IS within the urban economy. You are expected to: analyze cost effectiveness of AH, suggest ways and means to make AH more affordable to economically weaker section of the society as well, make a brief study on the contribution of IS to the urban economy and to housing and social capital they create.
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II. Use of Land Pooling Projects for Enhancing Efficiency and Equity in the Kathmandu Valley The purpose is to ensure better utilization of the products of land pooling projects in enhancing efficiency and equity. You are expected to: list the economic gains of such projects, analyze the existing condition of their products and the possibility of exploiting their potentials, and prepare an action plan for further development in the project site.

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III.

Economics of Inclusive Transport Services and Sustainable Urban Mobility

The purpose is to link the road network with the goal of enhancing urban mobility in Kathmandu Valley in a sustainable way. You are expected to: make an economic analysis of the recent initiative of the government on road widening, make a rough estimate of the costs involved, show whether the investments required are economically feasible or not, and suggest strategies for making transport services more inclusive. 15

IV.

Prioritizing Investments for Making Cities more Inclusive

The purpose is to determine investments that will enhance inclusiveness in the production, distribution and consumption of urban infrastructure and services. In order to ensure universal access of infrastructure and services, you are expected to prioritize investments for: enhancing community participation, encouraging private sector, and integrating informal sector . 16

Assignment 1. Mention briefly the goals and objectives of human settlements development? What are the economic problems of their development? Discuss their contributions to national and local economy. Discuss how different types of resources should be managed and mobilized for achieving the goals and objectives? 2. How is the level of urbanization related with the economic growth of a nation? Discuss the economic reasons of rapid urbanization in Nepal? What are the benefits and costs of urbanization in Nepal?

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3. Discuss different perspectives on land. Explain why land is considered both as a public good and a private good. Discuss the economic use of land resources. What do you mean by the unearned income? How can this be captured for enhancing the public good? What are the economic reasons for the rapid increase in the price of urban land? How does the urban land and real estate market influence urban economy and productivity?
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4. What are the economic reasons for the growth of cities? Explain what you mean by agglomeration economies and a primate city. Is there anything like optimum city size? What do you mean by urban economic base? How can you enhance the productivity of local economy? 5. Explain the significance of Economic Location Theory in the placing of different economic activities within a city. What do you mean by a footloose industry? What are the factors that determine the location of economic activities? Discuss the major factors that determine the location of central places? Explain how the land use within a city is determined. 19