TWO-DIMENSIONAL GEOGRAPHICAL POSITION AND ROAD IMPROVEMENT AS FACTORS IN DETERMINING THE GROWTH AND DECLINE OF RETAIL AGGLOMERATION

Abstract

 We investigate where retail stores agglomerate in a road network with radial roads and a ring road in a two-dimensional space. Per-distance travel cost on the radial roads can be different from that on the ring road. The transition of the two-dimensional agglomeration patterns of retail stores is investigated with decreases in the travel costs. Results show 1) a difference in improvement sequences in the radial and ring roads generates a difference in the agglomeration patterns with different welfare levels and 2) how the two-dimensional geographical position of shopping agglomerations ensuring the highest welfare level differs from that in equilibrium.