Simulation of urban revenues dynamics using systems dynamics approach

Municipalities are among the organizations that play an important role in the development of cities and the expansion of civic areas. Today, one of the most important issues for municipalities is creating sustainable sources of income and financing municipal services. Also, one of the biggest problems of the municipality is the reduction of the relative share of sustainable revenues, which will reduce the power of long-term and sustainable planning of this urban institution. In this research, as an applied research, the dynamics of municipal revenues, both stable and unstable, have been investigated using system dynamics. The use of systems dynamics method made it possible to study the causal relationships affecting the issue under study and by modeling the conditions prevailing in municipalities, it was possible to provide solutions to improve the current situation. The simulation results on one of the districts of Tehran Municipality show that with the continuation of the current situation, the share of stable municipal revenues will increase from 5% to only 21% in 1404. This is while the percentage of fulfillment of municipal revenue obligations reaches about 5% in 1404. Based on the simulation results in different scenarios, paying attention to the development of waste recycling infrastructure and focusing on increasing the collection of municipal toll revenues can increase the percentage of sustainable municipal revenues by up to 45%. The proposed model can be used as a basis for decisions of municipal managers to strengthen sustainable revenue sources and reduce costs.