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Retail shocks and city structure

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  • Maria Sánchez-Vidal

Abstract

This paper evaluates the consequences of opening out-of-town big-boxes on the commercial structure of cities. I use a discontinuity in a commercial regulation in Spain that restricts the entry of big-box stores in municipalities of less than 10,000 inhabitants for the period 2003 to 2011. I then use this discontinuity as an instrument for the big-box opening. The results show that three years after the big-box opening, around 15% of the grocery stores in the municipality have disappeared. However, some of the empty commercial premises are taken by other new small retailers in other sectors. As a result, the total number of retail stores in the municipality remains unchanged. These results show that a retail shock in the suburbs does not necessarily empty the city center but can also change only the composition of its commercial activity.

Suggested Citation

  • Maria Sánchez-Vidal, 2019. "Retail shocks and city structure," CEP Discussion Papers dp1636, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp1636
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    retail shocks; city structure; small stores; commercial activity;
    All these keywords.

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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