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Lecture 4

GGR 252 Lecture 4.docx

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Stephen Swales

GGR 252 Lecture 4 Basic spatial concepts:  Distance decay  Disincentive nature of distance. Friction of distance  Intervening opportunities  Range  Gravity models  Diffusion - The effect of river increases the friction of distance - Choropath map- The darker the shaded, the higher the income - Thesum polygon technique- boundary surrounding locations (distance only model) - Assumption in the model- they are absolutely identical - The line and point of indifference- being exactly halfway - When the market boundary moves towards you it’s called a gravity model (distance and size). This happens when A and B are not exactly identical and one is more attractive then the other. The customers move. - People go the nearest service available - If there is a gradual increase or decrease, there is no line of indifference - Chances of going to the near one is higher although there is still some probability to go the other one. Diffusion - Relocation diffusion- e.g. migration. (you cant be in two places at the same time) - Contagious diffusion- e.g. AIDS, SARS, idea (you can be at different places at the same time) - Hierarchal diffusion- e.g. fashion, innovation (likelihood of larger markets getting it first and then slowly diffuse in the market) In Retail - Organic growth (contagious)- based in one location and then slowly spreading - Acquisitions and takeover Hhtp:// The spatial demand curve - If the product is very expensive, then the quantity purchased will be low (you don’t see a lot of Mercedes compared to Toyota cars)—The demand curve - The greater the distance, the higher the transportation cost—cost and distance curve - Spatial price curve—the price of the journey to the mall adds up to the purchase of the product thus the higher the distance of the shop, the greater the price - Spatial demand curve- the further away, the less the purchase Intra- urb
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