“…In particular, the predictions of the monocentric models describe an equilibrium condition which also reflects additional sources of spatial heterogeneity over which households have specific preferences (Irwin, 2010 p77). Such preferences are related, for instance, to the presence of local public goods such as open spaces (Turner, 2005;Wu and Plantinga, 2003), environmental amenities (Tajibaeva et al, 2008;Wu, 2006), or a combination of both (Kovacs and Larson, 2007), and agricultural amenities (Coisnon et al, 2014), and are likely clustered in space. Since we do not observe such features in our data, we are confident that unobserved spatial heterogeneity is an important issue in the econometric estimation and should be considered appropriately.…”