The Spatial Distribution of Urban Consumer Service Firms: Evidence from Yelp Reviews

Abstract

A growing literature employs distance-based measures of localization to assess the spatial distribution of firms with a focus on manufacturing across a country. We analyze the spatial concentration of a variety of consumer services firms in the Phoenix, AZ area using geo-referenced Yelp data from over 29,000 establishments. Results from a K-density approach indicate substantial localization and service differentiation among localized firms. Firm concentration varies across service cost and quality; higher quality/cost establishments tend to cluster. Our results further understanding of the modern urban landscape as cities are increasingly centers of consumption.