THE INTRAMETROPOLITAN LOCATION OF SERVICES IN THE UNITED STATES

In metropolitan areas, firms trade-off land and information costs. Firms that gain the most from access to the knowledge and know-how of other firms in the same sector are willing and able to pay for expensive central city land. We found that legal services, advertising, and accounting and auditing services are the most centralized services in the 74 largest metropolitan areas of the United States. Maps of seven fast-growing business and professional services in Phoenix, Arizona, show that central city services are mainly located in the CBD. Using a logarithmic function, we found that service jobs are more decentralized in the larger metropolitan areas and in metropolitan areas outside the Northeast. Analysis of disaggregate service sectors shows significant intersectoral variation in this relationship.