Cities Spatial Model: Bridging research and practice in urban policy
Building the Cities Spatial Model: Bridging research and practice in urban policy
Cities shape growth, productivity, and opportunity, yet urban investment decisions often rely on tools that miss city-wide economic and spatial effects. The Cities Spatial Model - developed by the International Growth Centre and the City of Cape Town – is an open-source tool to help policymakers embed economic reasoning in urban planning. Discover more about how it was developed, in this post.
Cities have the potential to drive economic growth, but this depends on governments’ ability to overcome the downsides of dense living. Urban leaders make decisions every day about infrastructure investments and regulations that shape productivity and opportunity for decades. Yet these decisions often rely on tools that fail to capture the wider economic and spatial effects of change.
The Cities Spatial Model (CSM), developed through a partnership between the City of Cape Town (CCT) and the International Growth Centre (IGC) under its Cities that Work initiative, was created to close that gap.
What began as a local effort to strengthen the CCT’s use of economic appraisal has become a globally relevant, open-source model – and with the launch of a new user-friendly interface and free online training course for practitioners, it is now more accessible than ever.
From local urban challenges to a global tool
In the last few years, the City of Cape Town has invested a great deal in developing its capacity to use economic analysis to inform decisions across a wide range of urban issues. This includes two complementary strands of economic work:
1. Appraisal: Using cost-benefit analysis (CBA) to decide whether new projects or policies should be undertaken
2. Evaluation: Assessing the impacts of existing initiatives
While CBA remains essential, many of the CCT’s strategic questions required going further to answer questions such as: How would a new transport corridor affect where people live and work? How would densification influence housing prices and productivity? What should be prioritised in the face of funding and implementation capacity constraints? These decisions involve complex, city-wide adjustments that standard project appraisal cannot capture.
At the same time, new urban economics research was beginning to model exactly these effects. Academic research showed how quantitative spatial-equilibrium models can simulate interactions between workers, firms, and land markets, and how transport or land-use policies can reshape a city’s economic geography. For example:
- In Bogota, a study assessing the impact of the world’s largest Bus Rapid Transit (BRT) system – the TransMilenio – also looked at how land value capture tools might have altered the outcomes had they been implemented at the same time.
- In Mexico City, research evaluated the link between the new subway line, informality, and overall economic efficiency.
- In Kampala, a study explored the impact of land tenure systems on land use patterns and economic activity in the city.
- In Chicago, research looked at the welfare consequences of land-use regulations – in particular, zoning and floor-to-area ratios.
- In India, a paper investigated the spillovers from high-rise developments on slum dwellers.
Yet academic researchers rarely have incentives to repeat this analysis for every project or city. What was needed was a reusable, adaptable model that local governments could operate themselves.
What the Cities Spatial Model does – and why it matters for urban policy
Recognising the potential of these methods, the City of Cape Town and IGC’s Cities that Work team sought to translate these academic insights into a practical tool.
Thus emerged the Cities Spatial Model: a collaboration that combined IGC research expertise, CCT’s data and policy knowledge. Cape Town served as the pilot city and co-designer, ensuring that the model reflected the realities of policymaking rather than remaining a purely academic exercise.
The CSM is a quantitative spatial-equilibrium framework that captures how residents and firms choose where to locate within a city. By incorporating travel times, land and floor-space costs, and local productivity, it can simulate how policy changes reshape commuting patterns, employment, rents, and welfare across a city.
Where traditional CBA examines projects in isolation, the CSM reveals city-wide ripple effects. It helps policymakers see, for example, how a new BRT corridor might shift housing demand, improve access to jobs, or alter land values elsewhere in the metro.
Importantly, the model is usable in data-scarce settings. Its basic version requires a spatial grid of zones, travel times between them, indicative land or floor prices, employment data, and infrastructure costs.
Where traditional data sources fail, mobile phone data and other sources can be used to fill the gaps. This means many cities across Africa and beyond can adapt the model to their own context.
An open-source and open-access tool for cities everywhere
The Cities Spatial Model is now available as an open-source R package on CRAN. To broaden its reach, the IGC Cities that Work initiative has launched a new web-based interface (ShinyApp) that eliminates the need for coding.
Through the ShinyApp, users can upload data, run simulations, and visualise results in an intuitive dashboard. This will make the model accessible to a wider community of practitioners – municipal economists, planners, consultants – who want evidence-based insights without specialised software skills.
To support adoption, the IGC has also created a free online training course, hosted on Moodle, that introduces the model’s theory and practical application. The course includes step-by-step examples, data templates, and case studies to help users apply spatial-equilibrium thinking to their own cities.
What is next for urban decision-making?
As cities seek to plan for sustainable, inclusive growth, understanding spatial dynamics is essential. This partnership between the City of Cape Town and the International Growth Centre demonstrates how governments and researchers can co-create tools that embed economic reasoning in urban planning.
What began as a shared desire to improve appraisal has evolved into a global public good: an open-source model connecting data, economics, and policy. With the launch of the ShinyApp and online training course, the Cities Spatial Model enters a new phase – empowering practitioners worldwide to analyse, learn, and act.