Lecture 6

Week 6
Monday February 9th 2015
Spatial Definition of The Market: Demand and Cost Curve, Bid Rent Curve
Spatial Definition of Market
 Key issues
o Distance
 People will travel certain distances to buy certain goods
 Most retail happens in a local
 Less then 10km for a particular good
o Levels of Accessibility
 How long it takes you to get to the spot
 More complicated when you introduce shopping to urban downtown
 Also depends on socioeconomic
 High income are more mobile
 Young and elderly are not that mobile
o Level of Attraction
 People will travel to stores based on there experience of the store
 Size of the facility, the larger the more attractive

Demand Curve
 Relationship price and number of units/ items sold




 The price of the product will determine the level of demand
 The higher the less profit
 Suggest there is always a demand and that demand never reaches zero

Spatial Demand Curve
 Relationship between distance (travel cost), price of unit/item and number sold




 It considers the distance, travel cost, and price unit
 Travel cost is added to the cost of the unit
 You can get to a point of zero demand when including cost of travel (contrast the normal demand curve)
 The distance is so great that you wont go to that store therefore the demand is zero
 Why is spatial demand curve more important in retail geo – test

Spatial Demand Curve
 Consideration
o Type of good – convenience or shopping