A model of intraurban employment location: An application to Bogota, Colombia

A micro model is formulated to study the location behavior of manufacturing firms in urban areas. A bid-rent function is derived from the profit function and captures the firms' locational equilibrium situations. The theoretical model is extended to a multinomial logit specification and estimated using establishment survey results for Bogota, Colombia. The survey included information on (1) attributes of the establishment such as plant space, and (2) attributes of the plant site such as access to markets. The estimated model is capable of predicting the location choices of different types of firms.