A central limit theorem for endogenous locations and complex spatial interactions

Joris Pinkse, Lihong Shen, Margaret Slade

Research output: Contribution to journalArticlepeer-review

16 Scopus citations

Abstract

We provide a new central limit theorem (CLT) for spatial processes under weak conditions that are plausible for many economic applications in which location is endogenous. In particular, our CLT is designed for problems that have some, but not necessarily all, of the following features: (i) Agents choose the locations of observations to maximize profits, welfare, or some other objective. (ii) The objects that are chosen (e.g., stores or brands) interact with one another. For example, they can be substitutes or complements. (iii) Interaction can be complex. In particular, interaction between i and j need not depend only on the distance between the locations of i and j, but can also depend on distance to or location of other observations k, or possibly on the number of other such observations.

Original languageEnglish (US)
Pages (from-to)215-225
Number of pages11
JournalJournal of Econometrics
Volume140
Issue number1
DOIs
StatePublished - Sep 1 2007

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Applied Mathematics
  • History and Philosophy of Science

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