Article ID Journal Published Year Pages File Type
10479769 Journal of Urban Economics 2005 16 Pages PDF
Abstract
Important to many models of location choice is the role of local interactions or spillovers, whereby the payoffs from choosing a location depend in part on the number or attributes of other individuals or firms that choose the same or nearby locations in equilibrium. This paper develops the equilibrium properties of a broadly applicable and readily estimable class of sorting models that allow location decisions to depend on both fixed local attributes (including unobserved attributes) and local interactions, describes the conditions under which equilibria exist and are unique, and provides a test for uniqueness in empirical analyses of sorting equilibrium.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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