Spatial interaction models applied to the design of retail trade areas

Intermetropolitan trade areas are geographical zones defined by consumer movements over space -retail flows- from their municipalities of residence towards a head town, to purchase special goods: clothing and footwear, furniture, food, etc. These market areas own an economic sense that do not have other more commonly used territorial divisions, such as towns, provinces or regions. Since 1992, the Lawrence R. Klein Institute -Autonoma University of Madrid-actualises the Spanish Retail Trade Atlas and determines regional trade areas and sub-areas, using spatial gravity models and survey. The authors' experience in this Project allows them to analyse the different procedures suggested for modelling the consumer store-choice process and from this, estimating the market share of a retail outlet or a town. Store choice models can be classified into two main groups. First, the descriptive-determinist approach includes a group of techniques that rely on observation or normative assumptions. It is well-known the procedure devised by Applebaum (1961) for constructing primary trade areas from customers spotted on a location map or the classical central place theory, based on the nearest-centre hypothesis. 'Reilly's law of retail gravitation' (1931) considers not only distance but also attractiveness of alternative shopping opportunities. Secondly, the explicative-stochastic approach uses information revealed by past behaviour to understand the dynamics of retail competition and how consumers choose among alternative shopping opportunities. Huff was the first to use a utility function and introduced the spatial interaction models to explain consumer behaviour. They argued that consumers rate alternatives on the basis of their evaluation of the total utility of the store and not merely on its location. Huff's model is a particular case of the discrete-choice models known as multinomial logit (McFadden, 1974). Both models satisfies the so-called 'Independece of Irrelevant Alternatives' (IIA) property, that is, the ratio of the probabilities of an individual selecting two alternatives is unaffected by the addition of a third alternative. While this may be reasonably representative of certain aspatial choice situations, it is very unlikely to occur in spatial choice because of the fixed locations of spatial alternatives. The competing destinations model, derived from purely spatial considerations, provides a way of overcoming some problems with the logit and nested logit models that arise from the transference of essentially aspatial theory to the spatial realm. This work focuses on market area delimitation models and presents the estimation process developed by the L.R. Klein Institute in determining intermetropolitan trade areas. It is also applied a competing destinations model to the trade area of Madrid, a very peculiar one because of its magnitude and the important shopping concentration around the capital. Finally, we want to highlight the main applications derived from the knowledge and actualisation of the consumer retail flows. These applications take into account not only retailing but also another economic activities relating with market attraction areas.

Voronoi diagrams as a visualization technique for spatial autocorrelation in point data sets

This thesis explores a new way of visualizing spatial autocorrelation in a GIS environment. It explores some relationships between spatial autocorrelation models, spatial interaction models and weighted Voronoi diagrams. Since the weighted Voronoi diagram is equivalent to a form of spatial interaction models, any GIS with the ability to generate a gravity model can be utilized to perform this new technique of exploratory spatial data analysis. This thesis demonstrates how the cross product form of‘ spatial autocorrelation models like the Geary and the Moran statistics is equivalent to the form of a multiplicatively weighted distance utilized in the definition of weighted Voronoi diagrams. A transformation of the multiplicatively weighted distance into a representation of the Geary or the Moran statistic can be used to generate different weighted Voronoi diagrams. Since such a representation incorporates the spatial variation of data points and the spatial variation of the attribute values assigned to the data points, it provides a more appropriate visual representation than do existing representations that only operate on the spatial distribution of the data points. Data sets with a known degree of spatial autocorrelation are created with a simultaneous autoregressive model. The behaviour of the visual representations of the Geary and the Moran statistics for spatial autocorrelation varying from a high positive to a high negative degree is examined

The theoretical and methodological toolbox of urban economics: from and towards where?

After more than five decades since the recognition of the importance of a branch in Economics called Regional and Urban Economics, there is for sure sufficient scientific material for an ex-post evaluation of what has been achieved so far, where is the scientific frontier in this field, and what are the main open conceptual questions. The present contribution aims at providing such a "picture", by underlining, in a critical way, the results achieved and the challenges that still remain to be faced. It is not at all a first attempt in this direction: especially in the last decade, some doubts on the scientific achievements in the fields of Regional and Urban Economics, and more widely of Regional Science, were stressed, especially in the American academic world. These sciences were interpreted as going through a deep "scientific crisis", interpreted as a sort of downward slope in their "life cycle". Some scientific in-depth analyses have already been provided by regional scientists, rightly claiming that still much can be said and be produced in terms of both theoretical and empirical (modelling) elements. Our paper will start from those considerations, and provide a step further in the interpretation of the problems encountered by Regional and Urban Economics in the actual scientific world, and will strongly suggest that there are important signs of a reaffirmation of the discipline, given the recently strong renewed interest around the conept of territory, developed: - within other branches of the Economic theory. A clear example of this is the emergence of the "New Economic Geography" theory, widely anchored to some well known regional economic concepts. The same can be said for the recent concept of knowledge spillover of the Industrial Economists, in which the innovative diffusion process is largely dependent on geographical distance among innovative actors; - with traditionally related scientific fields, such as Urban Planning and Geography, for the development of a unified framework of analysis for territorial economic processes; - with sociologists, on the concept of "social capital", related to the interaction between social and economic elements for the explanation of the processes of knowledge creation at the local level. In all these cases, there is still place for a more in-depth cooperation among scientists, with the aim to achieve a more in-depth knowledge of theoretical concepts; moreover, in all these cases, there is still place for regional economists to strengthen their role within the international interdisciplinary arena. The paper will highlight these cases, and strengthen the reasons for this statement.

Channels of Synthesis Forty Years On: Integrated Analysis of Spatial Economic Systems

Isard’s vision of integrated modeling that was laid out in the 1960s book Methods of Regional Science provided a road map for the development of more sophisticated analysis of spatial economic systems. Some forty years later, we look back at this vision and trace developments in a sample of three areas – demographic-econometric integrated modeling, spatial interaction modeling, and environmental-economic modeling. Attention will be focused on methodological advances and their motivation by new developments in theory as well as innovations in the applications of these models to address new policy challenges. Underlying the discussion will be an evaluation of the way in which spatial issues have been addressed, ranging from concerns with regionalization to issues of spillovers and spatial correlation.Spatial economic system, Integrated analysis,

Two Alternative Macro-Based Approaches to Model Telecommunication Traffic

(no abstract available)Series: Discussion Papers of the Institute for Economic Geography and GIScienc

Intergovernmental Grants and Local Public Expenditure: Spending Decisions and Information Spillover Effects

This empirical study takes advantage of a new intergovernmental grant in order to investigate the expenditure behavior of the municipalities in Sweden in two ways. First, the grant is used to study the effect on municipal spending related to the grant. Second, the grant is used to test a hypothesis of spatial interaction among municipalities due to mimicking behavior. The grant and expenditures studied here pertain to one specific service area of the Swedish municipalities; services to functionally impaired individuals. The grant was introduced in 2004. The data used pertains to the period before (2001-2003) and after (2004-2007) the introduction of the grant. A fixed-effects spatial lag model is used to study the (possible) spatial interactions among municipalities. Interestingly, the results show that during the first time period, the municipalities interact with their neighbors when setting the expenditure level, possibly due to mimicking. In the second time period, after the introduction of the grant, there is no evidence of interaction. This would support the hypothesis that the governmental grants provide information to the municipalities and the need for mimicking diminishes with the grant.Local public expenditures; Intergovernmental grants; Spatial Interaction

Does Globalization Affect Regional Growth? Evidence for NUTS-2 Regions in EU-27

We analyze the influence of newly constructed globalization measures on regional growth for the EU-27 countries between 2001 and 2006. The spatial Chow-Lin procedure, a method constructed by the authors, was used to construct on a NUTS-2 level a complete regional data for exports, imports and FDI inward stocks, which serve as indicators for the influence of globalization, integration and technology transfers on European regions. The results suggest that most regions have significantly benefited from globalization measured by increasing trade openness and FDI. In a non-linear growth convergence model the growth elasticities for globalization and technology transfers decrease with increasing GDP per capita. Furthermore, the estimated elasticity for FDI decreases when the model includes a higher human capital premium for CEE countries and a small significant growth enhancing effect accrues from the structural funds expenditures in the EU.Regional globalization measures, EU integration (structural funds), Regional growth convergence models, Foreign direct investment (FDI)

Does Globalization a ffect Regional Growth? Evidence for NUTS-2 Regions in EU-27

We analyze the influence of newly constructed globalization measures on regional growth for the EU-27 countries between 2001 and 2006. The spatial Chow-Lin procedure, a method constructed by the authors, was used to construct on a NUTS-2 level a complete regional data for exports, imports and FDI inward stocks, which serve as indicators for the influence of globalization, integration and technology transfers on European regions. The results suggest that most regions have significantly benefited from globalization measured by increasing trade openness and FDI. In a non-linear growth convergence model the growth elasticities for globalization and technology transfers decrease with increasing GDP per capita. Furthermore, the estimated elasticity for FDI decreases when the model includes a higher human capital premium for CEE countries and a small significant growth enhancing eff ect accrues from the structural funds expenditures in the EU.

A GIS – Based Approach for Catchment Area Analysis of Convenience Store

AbstractThis study is conduct to evaluate socio-economics and/or demographic attributes of convenience store based on catchment area prediction. In this preliminary analysis, we find that more specific data related to demographics of the population are needed to see the correspondence between the location of the convenience store with the distribution of the population. It also shows that GIS-based approach is a powerful method to collect data, perform spatial analysis, combine and manage both spatial and attributes data, such as finding features inside determinant region

Models and scenarios for European freight transport based on neural networks and logit analysis

In this paper we analyse interregional freight transport movements in Europe with a view on new spatial patterns based on transport economic scenarios for environmental sustainability. Two different approaches are compared. viz. the logit model and the neural network model. The paper will essentially deal with a research experiment for the robustness of interregional freight flows by comparing the two above methodologies. Our results in this framework highlight the fact that the two models adopted, although methodologically different, are both able to provide a reasonable spatial representation of the interregional transport flows in Europe