Analysis of a gravity demand model

Abstract

Eilon S., Tilley R. P. R. and Fowkes T. R. (1969) Analysis of a gravity demand model, Reg. Studies 3, 115–112. This paper describes a gravity model for estimating retail expenditure at shopping centres. The gravity model makes assumptions about the relative attractiveness of shopping centres in a given region with a given total level of expenditure. The model suggests that an equilibrium solution exists, such that when it is reached there is no tendency for the sales at any centre to grow or to decline. The paper analyses the nature of this solution. It is shown that in some cases the model will indicate that the value for the equilibrium solution for sales at a centre is zero. Furthermore, it is shown that, except under special conditions, this equilibrium solution is unique. An example with two shopping centres and two expenditure zones is fully analysed and graphs and maps are drawn to illustrate the solutions obtained.