Telecommuting refers to a system under which employees work at home for one or more days per week and use personal computers and telephone lines to interact with people in the office. Consider an office firm that must decide whether to locate in the Central Business District or along a suburban beltway (to be closer to its suburban workforce). Discuss the effects of telecommuting on the relative attractiveness of the CBD.
(1.)Telecommuting refers to a system under which employees work at home for one or more days per week and use personal computers and telephone lines to interact with people in the office. Consider an office firm that must decide whether to locate in the Central Business District or along a suburban beltway (to be closer to its suburban workforce). Discuss the effects of telecommuting on the relative attractiveness of the CBD.
(2.)Consider a modern city in which office employment has been steadily shifting from the city center to suburban locations along beltways. Suppose that the city improves its mass-transit system, decreasing the monetary and time costs of radial travel. Assume that the improvement in the transit system does not affect the spatial distribution of residents. Will the improvement in the system speed up or slow down the movement of office firms to the suburbs?
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