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Consumer Mobility and the Local Structure of Consumption Industries

Author

Listed:
  • Sumit Agarwal

    (Georgetown University)

  • J. Bradford Jensen

    (Georgetown University)

  • Ferdinando Monte

    (Georgetown University)

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.

Suggested Citation

  • Sumit Agarwal & J. Bradford Jensen & Ferdinando Monte, 2020. "Consumer Mobility and the Local Structure of Consumption Industries," Working Papers 2020-006, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2020-006
    Note: MIP
    as

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    File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/Agarwal_Jensen_Monte_2020_consumer-mobility-local-structure-consumption.pdf
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    References listed on IDEAS

    as
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    Cited by:

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    2. Andrea Batch & Benjamin R. Bridgman & Abe C. Dunn & Mahsa Gholizadeh, 2023. "Consumption Zones," BEA Papers 0114, Bureau of Economic Analysis.
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    4. Akira Matsui & Daisuke Moriwaki, 2022. "Online-to-offline advertisements as field experiments," The Japanese Economic Review, Springer, vol. 73(1), pages 211-242, January.

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