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We set out a small, open economy model of a city, one with local housing, government production and a non-traded good. We observe that a positive shift in labor productivity in the export sector generally results in a larger, higher-wage and more densely settled city. Production of the local public good increases for the special case of the public good 'counting' small in the utility function of the representative resident. Similar results obtain for the case of a city experiencing an exogenous improvement in a local climate amenity.

We set out a city as a price-taking exporter and importer with its own local structure (housing (land per household) and a local pure public good are produced endogenously). We improve labor efficiency in the export sector, observe a jump in the local wage, and trace the impact, particularly on production of the public good. In one case the population, output of the public good, and residential density expand (the law of urban growth) and in another, population, output of the public good and density contract.