Spatial Economics for Granular Settings

Jonathan Dingel and Felix Tintelnot

No 14819, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We introduce a general-equilibrium model of a "granular" spatial economy populated by a finite number of people. Our quantitative model is designed for application to the growing body of fine spatial data used to study economic outcomes for regions, cities, and neighborhoods. Conventional approaches invoking the law of large numbers are ill-suited for such empirical settings. We evaluate quantitative spatial models' out-of-sample predictions using event studies of large office openings in New York City. Our granular framework improves upon the conventional continuum-of-individuals model, which perfectly fits the pre-event data but produces predictions uncorrelated with the observed changes in commuting flows.

Keywords: Commuting; Granularity; Gravity equation; Quantitative spatial economics (search for similar items in EconPapers)
JEL-codes: C25 F16 R1 R13 R23 (search for similar items in EconPapers)
Date: 2020-05
New Economics Papers: this item is included in nep-geo and nep-ure
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Citations: View citations in EconPapers (30)

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Related works:
Working Paper: Spatial Economics for Granular Settings (2020)
Working Paper: Spatial Economics for Granular Settings (2020)
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