The name is absent



Figure 2

Fractions of Employment/Labor as a
function of traveling distance
d to CBD

In Figure 2, E1=70, and we have
assumed a price reduction of 10 in the
CBD, counteracted by a constant
traveling cost
TC= 0.1$/km. To take
the model one step further, we
consider a collection of
N different
types of stores and goods,

F1,F2,...,FN, each of which requiring E1, E2 ,...,EN employees to serve 1000 customers. Each different
type of store
Fi can offer a price reduction PRi in the CBD, i=1,2,...,N. Without loss of generality,
we can assume that the different types of stores have been sorted in such a way that the price
reductions increase with
i. We keep the basic assumption that the customers do their shopping
locally by
Fi if TCdistance = PRi, i=1,2,...,N, and at the CBD otherwise. Note, however, that if the
customers benefit from more than one good at the same time the total savings from traveling to the
CBD might exceed the traveling cost even when each saving is separately exceeded by
TC. We will
deal with this case of multipurpose shopping later. An example with 3 different types of firms is
shown in Figure 3.

E∕L

120


ιoo


sc


so


4G


20


50


1 00


150


Figure 3
Fractions of Employment/Labor as a
function of traveling distance
d to CBD

In Figure 3 we have put E1=70,
E
2=40, E3=25, PR1=$10, PR2=$20,
PR
3= $30 and TC=0.1$/km. As a next
step we replace the constant
TC by a
random variable. Traveling to the
CBD has an important time
component, and the value of time


savings relates to the wage level. Hence, traveling costs can be expected to vary considerably over
the population. In the following we will assume that wages are distributed according to a probability
distribution carrying a (usually continuous) density
Ψ=Ψ[w], where w denotes the wage level and
Ψ 0 on (-8,0). The relationship between wage and the valuation of time naturally depends on trip
purpose. Norwegian authorities recommend that an hour spent on journey-to-work should be
evaluated by NOK 46, see Hândbok-140 (1995). This estimate is based on information of average
hourly earnings in manufacturing in 1995. To be more precise NOK 46 represents roughly 42% of
the hourly earnings. The estimate of NOK 46 corresponds reasonably well to empirically based
estimates in Tretvik (1995). Tretvik (1995) in addition estimates the value of time for different
income groups. The numerical experiments to be carried out in this paper are based on an
assumption that the value of time savings represents a constant fraction of the wage level. This is
assumed to apply for any trip purpose. The recommendations of Norwegian transportation



More intriguing information

1. Do imputed education histories provide satisfactory results in fertility analysis in the Western German context?
2. Initial Public Offerings and Venture Capital in Germany
3. WP 92 - An overview of women's work and employment in Azerbaijan
4. The Impact of Minimum Wages on Wage Inequality and Employment in the Formal and Informal Sector in Costa Rica
5. Commitment devices, opportunity windows, and institution building in Central Asia
6. Contribution of Economics to Design of Sustainable Cattle Breeding Programs in Eastern Africa: A Choice Experiment Approach
7. Gender stereotyping and wage discrimination among Italian graduates
8. The name is absent
9. Creating a 2000 IES-LFS Database in Stata
10. The Provisions on Geographical Indications in the TRIPS Agreement
11. Quality Enhancement for E-Learning Courses: The Role of Student Feedback
12. MULTIMODAL SEMIOTICS OF SPIRITUAL EXPERIENCES: REPRESENTING BELIEFS, METAPHORS, AND ACTIONS
13. Gender and headship in the twenty-first century
14. The name is absent
15. Behavioural Characteristics and Financial Distress
16. Estimating the Impact of Medication on Diabetics' Diet and Lifestyle Choices
17. The name is absent
18. Trade Openness and Volatility
19. Dementia Care Mapping and Patient-Centred Care in Australian residential homes: An economic evaluation of the CARE Study, CHERE Working Paper 2008/4
20. ENERGY-RELATED INPUT DEMAND BY CROP PRODUCERS