This paper considers the economic impact of an urban transportation thoroughfare emanating from the central business district of a city to agricultural land. Utilizing the elements of microeconomic theory, namely the models of the producer and of the consumer, we have made an analysis of how a residential area develops around a thoroughfare under different assumptions including transportation costs along the thoroughfare, and the technology of producing residential dwellings in the surrounding area. This contribution can be looked upon as the analysis of residential development in a star-shaped city; the focus is on one branch of the star. With the aid of computer graphics, alternative economic landscapes surrounding the thoroughfare are simulated. The purpose of this paper is to demonstrate the nature of city-forming forces which are generated by the decision making of producers and consumers in spatially defined areas. By demonstrating in the particular case of an urban thoroughfare the powerful city-forming influences of decision making of city dwellers, it is hoped that urban policy makers may be alerted to some different aspects of the ongoing processes of urban change.