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The location of new anchor stores within metropolitan areas

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  • Zhou, Tingyu
  • Clapp, John M.

Abstract

We examine the intra-metropolitan location decisions of retail stores by focusing on the openings of a comprehensive list of department (“anchor”) stores in the United States. The nonparametric K-density procedure shows that new stores are more dispersed than existing stores; their locations depend on existing competitive conditions. By applying a conditional logit model (CLM), we find that the location choices of new anchors can be associated with zoning, population, CBD and highway proximity, potential revenue and revenue growth, cannibalization, competition and localization economies. We find a lower bound on negative competitive effects in some regions. The CLM-based K-density confidence intervals explain actual location patterns within three miles.

Suggested Citation

  • Zhou, Tingyu & Clapp, John M., 2015. "The location of new anchor stores within metropolitan areas," Regional Science and Urban Economics, Elsevier, vol. 50(C), pages 87-107.
    • Handle: RePEc:eee:regeco:v:50:y:2015:i:c:p:87-107
    DOI: 10.1016/j.regsciurbeco.2014.11.003
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    Cited by:

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    2. Brad Humphreys & Josh Matti, 2018. "The Spatial Distribution of Urban Consumer Service Firms: Evidence from Yelp Reviews," Working Papers 18-03, Department of Economics, West Virginia University.
    3. Patel, Pankaj C. & Struckell, Elisabeth M. & Ojha, Divesh & Manikas, Andrew S., 2020. "Retail store churn and performance – The moderating role of sales amplitude and unpredictability," International Journal of Production Economics, Elsevier, vol. 222(C).
    4. Song Zhang & Mark van Duijn & Arno J. van der Vlist, 2020. "The external effects of inner‐city shopping centers: Evidence from the Netherlands," Journal of Regional Science, Wiley Blackwell, vol. 60(4), pages 583-611, September.
    5. Gabriel Lang & Eric Marcon & Florence Puech, 2020. "Distance-based measures of spatial concentration: introducing a relative density function," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(2), pages 243-265, April.
    6. Derya Celik Turkoglu & Mujde Erol Genevois, 2020. "A comparative survey of service facility location problems," Annals of Operations Research, Springer, vol. 292(1), pages 399-468, September.

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    More about this item

    Keywords

    Localization vs competition; Multi-line department stores; Retail locations; Conditional logit; K-density confidence bands;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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