Consumer Mobility and the Local Structure of Consumption Industries

Sumit Agarwal, J. Jensen () and Ferdinando Monte

No 23616, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study local employment, establishment density, and establishment size across industries delivering final consumption, which comprise a substantial fraction of production, shape local amenities, and pay different wages. In a stylized model of consumer mobility, lower industry storability/durability concentrates demand in space, increasing equilibrium employment. Credit card transactions data show that consumer mobility is limited and varies substantially across sectors; moreover, expenditure declines more rapidly with distance in sectors transacted more frequently. Lower storability/durability, proxied by average transaction frequency, increases a sector’s local employment via higher establishment density. Variation in consumer mobility is as economically significant as consumers’ expenditure shares.

JEL-codes: F1 F14 L8 R1 R2 (search for similar items in EconPapers)
Date: 2017-07
New Economics Papers: this item is included in nep-geo and nep-ure
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Working Paper: Consumer Mobility and the Local Structure of Consumption Industries (2017)
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