Economics of information examples in location and land-use theory

In many contexts a decision taken by one economic agent reveals valuable market information to other agents. Two such examples are displayed. In the first case, the location of a retailer reduces locally the uncertainty in the spatial variation of demand, thereby attracting other retailers. In the second case, the change in the quality of rental housing in a homogeneous neighborhood reveals consumer demand which may invite other landlords to follow suit causing capid neighborhood change.