An equilibrium model of office location and contact patterns
In this paper, we develop an equilibrium model of office location, which explicitly considers the source of agglomeration economies and which sees firm location and contact patterns as jointly and endogenously determined. We solve the model explicitly for contact-benefit, facility-cost, and transport-cost functions representative of medium-sized US cities. The resulting rent functions are concave rather than convex as they are in most models of industrial and residential location. The source of the concavity is that firms make contacts throughout the central business district (CBD). To determine the role of agglomeration economies associated with interfirm contacts, we alter the contact-benefit function, the transport-cost function and the size of the CBD. We find that agglomeration economies have a strong effect on location and, indeed, are often sufficiently strong to produce counterintuitive results. For example, an increase in transport costs causes a decrease rather than an increase in transport expenses, because in the city, which is now smaller, a firm decreases the number of contacts. Further, the increase in transport costs does not increase the relative attractiveness of the center.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
When requesting a correction, please mention this item's handle: RePEc:pio:envira:v:15:y:1983:i:10:p:1311-1326. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Neil Hammond)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.