The role of digitalisation in the spatial distribution of the economy

Changes in labour markets and consumer behaviour influence the spatial structure of the economy, for example cityscapes and the locations of companies. We are analysing new data sources, either from digital footprints of the population, i.e. mobile phone data and GPS data from smartphone applications, or from information provided by customer loyalty programmes. By doing so, we hope to better understand the influence of digitalisation on the role of spatial proximity for the economy. We also plan to investigate the changes in spatial consumption patterns and neighbourhood dynamics.

On the one hand, digitalisation affects the organisation of economic activities, also within cities. On the other hand, it affects the balance of forces that determine the dynamics between city and periphery, i.e. whether economic activities are geographically concentrated in cities or scattered across the periphery.

Our aim is to understand how digitalisation affects the geography of the economy: will agglomerations withdraw economic activity from the periphery? Or, conversely, will regions move closer together? We want to find out whether city centres will become less important for consumption and therefore attract other target groups and activities in the future. We also intend to investigate whether digitalisation influences the way different age groups and social groups mix in cities.

This project combines economics and data analysis. The aim of our basic research is to contribute to the understanding of the spatial economy, and in particular to identify the effects of digitalisation. Our findings can for instance be useful in urban planning, and serve to assess planning measures at an early stage. For regional policy, our analyses provide information regarding shifting attractiveness of locations due to digitalisation.

The Hidden Consequences of Digitalization for the Spatial Economy