GGR252H1 Lecture Notes - Lecture 8: Postal Codes In Canada, Distance Decay

50 views2 pages
16 Apr 2013
The Converse Breakpoint method make it possible to predict the point
between two centres (E.g. Shopping centres) where the trading influence of
each is equal, we can think of this point as the point or line of indifference
(i.e. Where the utility of the two centres is equal). It sis also the market
boundary between the centres.
The method uses distance and size to calculate the line of indifference (i.e.
The market boundaries)
Converse Breakpoint Method
o Dy= (Dxy) /( 1+ sqrt (Ax/Ay)) - In textbook
o Dxy distance btwn x and y
o Ax attraction to X/Y
o Draw breakpoints at 90 degree angles
The converse formula requires data aon distance between centres and size of
centres. Together these two vairables are thought to adequently measure the
reative utility of the centres. The formula suggests that the utility of the
centre decreases with distance and increases with size
Size meansure could be : numbers of stores, square footage of the centre,
number of employees, number of parking spaces, etc.
The formula calculates the distance of the breakpoint ( line of indifference)
from the subject Centre
Unlike the Theisson polygon method the converse method does not assume
that all centres are equal in attractiveness (size). It does however have the
other unifying assumptions evident in the Theisson method ( fully informed
rational maximize)
Again we will find possible weaknesses in the model in its unifying
assumptions, to what extent does the “real world” meet these assumptions?
Is a size measurement an effective surrogate measure of all aspects of image
in attraction? What about the ambiance and design of the centres?
In common with Theisson method the technique produces spatial monopoly
market areas, once the boundaries are established it is assumed that
everybody inside the boundaries shops at the subject centre) n reality we are
more likely to be dealing with overlapping market areas: yes there is a hgh
likelihood that consumers will shop at nearer larger centres but there is
always some possibility that they will shop at other centres. A more
sophisticated gravity model that addresses this concept of overlapping
markets in probability framework is the huff model we will now address
this method in detail.
Unlock document

This preview shows half of the first page of the document.
Unlock all 2 pages and 3 million more documents.

Already have an account? Log in

Get OneClass Notes+

Unlimited access to class notes and textbook notes.

YearlyBest Value
75% OFF
$8 USD/m
$30 USD/m
You will be charged $96 USD upfront and auto renewed at the end of each cycle. You may cancel anytime under Payment Settings. For more information, see our Terms and Privacy.
Payments are encrypted using 256-bit SSL. Powered by Stripe.