LAND RENT IN THE CENTRAL BUSINESS DISTRICT OF A CITY AS A KEY FACTOR OF SOCIAL SERVICE DEVELOPMENT

Abstract

This article summarizes different approaches to investigation of land rent in the central place system e.g. in the business district of a large city or agglomeration as a key factor of social service development. The main purpose of the study is increase of profitability and competitiveness of service enterprises due to improvement of their location in the business district centre. Systematization of literature sources and approaches to solving the problem of land rent in central business district development allowed to single out the works of domestic scientists such as Tkachenko T. I., Drapikovskyi O. I., Ivanova O. O., Gritsai O. V., Vakulenko V. M., Dekhtiarenko Yu. F., Zakharchenko V. I., Litvinenko R. I., as well as researches of foreign scientists such as Fujita M, Thisse J.-F., Henderson V., Herbert Giersch. The urgency of solving this scientific problem is that land rent in central place system e.g. in the business district of a large city became the main driver of service sector development. The study of land rent development in the article is carried out in the following logical sequence: land rental development of trade objects in a monocentric city, retail locations, rent for trade in episodic demand goods, rent for trade in goods of constant demand, the main feature of the trading enterprises rent investigation, residential land rent of a city, two rent types of residential development estimation, rent function with replacement of production factors instead of output or rent gradient investigation. Methodical tools of the conducted research are methods of formalization, algorithm development, descriptive, analytical and synthetic. The object of the study is land rent development in the central business district of a large city or agglomeration. The article presents the results of an empirical analysis of land rent development in the central business district, which showed its influence on service sector location and growth. The study empirically confirms and theoretically proves procedures of land rent estimation for increasing profitability and competitiveness of service enterprises due to improvement of their location. The results of this study may be useful for different Tourism and Service Companies looking for the best location place in the central business district of a large city.