OPTIMUM LOCATION OF PUBLIC FACILITIES UNDER THE INFLUENCE OF THE LAND MARKET*

ABSTRACT. This paper discusses the problem of the optimal location of public facility(ies) in a long narrow city, especially taking into consideration the externality-internalizing effect of the land market. It shows a systematic approach to dealing with the land market mechanism in first a one-facility and then a two-facility case. The analysis assures the importance of posing the location-optimizing problem even under the influence of the land market.