Quantifying Retail Agglomeration using Diverse Spatial Data

Abstract

Abstract Newly available data on the spatial distribution of retail activities in cities makes it possible to build models formalized at the level of the single retailer. Current models tackle consumer location choices at an aggregate level and the opportunity new data offers for modeling at the retail unit level lacks an appropriate theoretical framework. The model we present here helps to address these issues. Based on random utility theory, we have built it around the idea of quantifying the role of floor-space and agglomeration in retail location choice. We test this model on the inner area of Greater London. The results are consistent with a super linear scaling of a retailer’s attractiveness with its floorspace, and with an agglomeration effect approximated as the total retail floorspace within a 300 m radius from each shop. Our model illustrates many of the issues involved in testing and validating urban simulation models involving spatial data and its aggregation to different spatial scales.