ABSTRACT
In economic literature the most popular approach to measuring the urban quality of life is the hedonic price method, based on an index measuring the monetary value of a bundle of local goods and services. The index is a measure of the utility provided by the composition of local goods available in the city where an individual lives. The disamenities have a negative value for the implicit price and decrease the index value. Rosen ranked American cities on the basis of climate conditions, pollution, crime and market conditions. He first develops a partial equilibrium model where the hedonic price function emerges from the interaction between suppliers and demanders of a differentiated commodity. The hedonic price function provides an information on the marginal bids of the consumer for each amenity. The hedonic quality of life index is an attractive and compelling methodological tool for assessing quality of life in urban areas.
