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The rise of remote work during the COVID-19 pandemic didn’t just hurt downtown office spaces, their ground-floor coffee shops and surrounding businesses.New research from Northeastern University finds that the impact on commerce — from gas stations to entertainment venues — extended far beyond central districts.
“The three main ingredients for a business historically are location, location, location — or the idea that the success of a business depends on what is close by,” says Esteban Moro, professor of physics and part of the Network Science Program at Northeastern. “But our findings challenge that traditional emphasis on proximity.”
Moro and colleagues at several universities nationwide analyzed cellphone location data from millions of trips to New York, Boston, Los Angeles, Seattle and Dallas. By mapping visits from one location to another, they captured the web of interdependence connecting diverse businesses and sites.
Published in Nature Human Behavior, the study reveals that our daily movements are less neighborhood-bound than assumed, creating dependencies among businesses and places that go beyond immediate surroundings.
For instance, gas stations depend on office workers commuting from suburbs, and museums and other art and entertainment venues depend on colleges and universities, even if they are far away. These dependencies, often invisible, extend the economic impact of one business onto others, regardless of geographic distance.
The researchers also examined data from 2019 and 2020 to understand the impact of the pandemic shutdown. By analyzing how disruptions ripple through these long-distance dependencies, the team could predict a business’s resilience during shocks like COVID-19 with 40% greater accuracy than traditional models, which primarily consider vicinity-based influences.
Moro and co-author Takahiro Yabe of New York University, note that the research has “profound” implications for city planning and urban economics, particularly in evaluating new developments and growth.
“When designing urban spaces — whether it’s commercial zones or new entertainment hubs — we need to consider how people’s behaviors can create dependencies on locations far beyond the immediate area,” Moro says.
“This points to the need for a new approach to planning and managing urban areas as a whole, one that recognizes the complex and often hidden ways in which businesses depend on each other and that extends beyond business or commercial districts.”
The cellphone data’s insights may also act as an early warning system during economic downturns or new developments.
“The permanent or temporary closure of an office or museum might seem insignificant,” Moro says. “But in the interconnected world of urban economies, it could be a first step in a chain reaction that affects businesses and communities far and wide.”