The geography of shopping

Where are the shops where we get the things we need located geographically? And what does it mean?

Özge Öner recently defended her doctoral thesis in Economics, "Retail Location", at Jönköping International Business School.

- You can’t understand retail by just looking at retail, Özge says. You need to look at everything in the region.

And so that is what she has done. In four different chapters, her thesis discusses how the location of shops affects municipalities and regions and the people who live there. She uncovers this: specialized shops that has just one kind of service that is interchangeable, like locksmiths, bookshops and grocery stores, are located in pretty much every city centre, no matter how small. They stay close to the customer. Because of the nature of their products, the customer is likely to just choose the shop closest to them geographically. On the other hand, stores who are larger, aim for a wider audience and offer a wider service, tend to be situated further away from the customer. This could be stores like Elgiganten or Ikea for example. Their customers know what they want and are prepared to travel to get it.

The availability of shops affects the attractiveness of a place and the house prices tend to go up in a municipality with many shops.

- People like to live where they can not only be productive, but where they can spend their money also, Özge says.

But this is not the whole truth. It’s not always necessary to have all those shops right there, in that specific small city centre. If the shops of the larger region are attractive enough, that will affect the attractiveness of the smaller municipalities as well, even if the shops are not actually located there. This is, for example, the case with several suburbs to Stockholm.

What can smaller municipalities learn from this?

- It’s not always necessary to take action to increase the retail in your city centre, you could cooperate with other small municipalities around you, Özge says. Collaborations should work really well.

Retail Location was successfully defended on May 23. Faculty opponent was Professor Lars Westin, Umeå University Examining committee was Associate Professor Alessandra Faggian, Ohio State University, USA, Professor Geoffrey J.D. Hewings, University of Illinois at Urbana-Champaign, USA and Professor Börje Johansson, JIBS.

Chairperson and main tutor was Associate Professor Johan Klaesson, JIBS.