Wednesday, October 05, 2022

The Convergence of Gas Stations

Over Fall Break I drove to Harrisonburg to visit a friend for the afternoon at JMU. As I was leaving I realized I needed to get gas, so that I didn't get stuck on the highway on the way back Charlottesville. As I was looking around for gas stations, I determined that a majority of the gas stations in the JMU area are all right next to each other. This is a great example of Downs' Spatial Location Theory. These establishments set themselves up right next to each other so that they can attempt to capture the greatest portion of the customer base. This approach was successful for these firms because due to the similar location of the four gas stations near me, I decided to go to the one that was a couple cents cheaper because it would save me money (these four were within .2 miles of each other). While in the grand scheme of things this decision likely saved me no more than .50 cents it felt like a good decision because the lower price compelled me to choose the station. 

The difference in cents is like how the Spatial Location Theory applies to voters. If parties move to the middle of the spectrum to capture the median voter the small differences in policy will capture more median voters and determine the outcome of the election. While there really wasn't much of a difference in the gas stations that I had access to, the smallest difference that had little to no true effect on me led me to make a decision on the gas station that I would 'vote' for because I felt that the gas station maximized my utility the most.

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