The modern capital serves its residents in many ways: we live, work, seek leisure and simply walk its paths. In the past, space was not sharply divided along these lines, but during the 19th century, the various uses of city space began to be differentiated, so as to prevent certain uses of some land from causing nuisance or harm to other parts.The combination of land uses within a city varies across Israel’s municipalities and local councils, and the particular mix generally reflects the character of the metropolis. For example, a local council with a particularly high percentage of residential areas will serve primarily as a bedroom suburb whose residents seek employment and recreation elsewhere.Land use plays a major part in the city’s socioeconomic status. We would expect, for example, that a town with large industrial zones – a main source of employment – would have many residents employed as blue-collar workers in the industrial sector. In contrast, a town with a lot of office space would serve as a home for many professionals. The combination of land uses is extremely significant in relation to the municipal budget, which is based on arnona (municipal tax) from city apartments and properties, some of which yield higher taxes than others: commerce zones yield a much higher arnona than residential ones. In other words, the combination of land uses in large part determines the city’s economic base.Jerusalem is Israel’s largest city after Dimona in terms of area of jurisdiction, covering 125 square kilometers – significantly higher than Tel Aviv at 52 sq.km., and Haifa at 65. Yet only 47 percent of Jerusalem comprises built-up areas, compared with 73% of Tel Aviv and 55% of Haifa. The large discrepancies between these cities become strikingly apparent when we examine how their built-up areas are divided for various uses.Among the major cities with a population greater than 200,000, Jerusalem dedicates the highest percentage of its built-up areas to residential purposes (71% ). This is high relative to what we might expect for the country’s largest metropolis. Among the major cities, Ashdod and Haifa have the lowest percentages of residential areas as a proportion of builtup areas; they have large areas zoned for industry, as well as the infrastructure and transportation necessary for the ports they contain.Another striking discrepancy among the major cities is the difference in percentage of area zoned for commerce and office space. Only 6% of the built-up area in Jerusalem serves as commerce or office space, while it is 17% in Tel Aviv – nearly threefold. Haifa comes in at 13%, more than twice that of Jerusalem.Areas zoned for commerce and office space are particularly significant in terms of the municipal budget, because they yield higher arnona revenues than other land uses. As most of a municipality’s independent revenue comes from arnona, the motivation to expand areas of commerce and office space is evident. This is apparently the reason that the big plans for city development focus on the business zone now taking shape and form at the entrance to the capital. It is important to keep in mind, however, that zoning land for commerce and office space does not guarantee it will be used for this purpose.After zoning land for a particular use, and before printing those promising arnona bills, the city must create incentives for companies and business owners to come and set up shop in the new business zone, and thus actualize its intended use. Translated by Merav Datan.