The Dictionary of Human Geography

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Suggested reading

Bell and Valentine (1995); Browne, Brown and

Lim (2006).

hot money Portfolio capital investment

that is both short-term and volatile in nature

(Froot, O’Connell and Seasholes, 2001). Hot

money accumulates rapidly in periods of eco-

nomic boom, but dissipates quickly in times of

crisis, which tends to exacerbate and intensify

suchcrises. Portfolio capital investment is

risk averse, and is directed mainly towards

property and financial commodities, for

which there are well developed secondarymar-

kets. These secondary markets expedite both

the rapid entry and exit of money from an

economy. The inflow and outflow of hot

money has been associated with numerous fi-

nancial crises since the beginning of the twen-

tieth century, and recently with financial crises

in South East Asia, Russia and Argentina. al

Suggested reading

Froot, O’Connell and Seasholes (2001); Naylor

and Hudson (2004).

Hotelling model A classic model of the loca-

tionstrategy deployedbyfirms seekingtomaxi-

mize theirmarketshare through the size of

theirhinterlands. The original model pro-

duced by Harold Hotelling (1895–1973: see

Hotelling, 1929) identified the strategies of

two firms competing in a linear market, where

customers were evenly distributed, and was

generalized with the example of ice-cream

sellers competing on a beach (Alonso, 1964b).

As formulated, the model showed that, what-

ever their starting locations (e.g. figure 1), the

two firms would converge at the centre of the

beach (figure 2), from where each would serve

the half of the customers closer to them than to

their competitor: those furthest from the centre

would pay more for the product because of the

greatertransport costs/time involved in mak-

ing a purchase. The most efficient equilibrium

distribution for two firms sharing the market

equally would be that shown in figure 3, with

each serving half of the beach and the total

transport costs less than in figure 2. Each firm

wouldrealize,however,thatifitmovedcloserto

the centre it could capture customers from its

competitor,hencethetwoproviderscongregate

there.

Hotelling’s model has been used to account

for patterns ofagglomerationunder certain

circumstances, and has also been applied to

other competitive situations, exemplified by

the large literature on the ‘spatial theory of

voting’ developed from Downs’ (1957) classic

work (cf.public choice theory). rj

household A socio-economic formation

comprised of one or more individuals who

share living quarters, often framed as those

who ‘eat from the same bowl and live under

one roof’. While this notion provides some

latitude against the common assumption that

the household is coterminous with family,

whether nuclear or extended, it lacks the spa-

tial robustness to encompass more expansive

notions, including the increasingly common

formation of transnational households.

Wright and Ellis (2006) frame the household

‘simultaneously as a spatialscaleand a set of

practices; not situated in one place, but involv-

ing heterogeneous lives interacting with others

all over town’, or further afield, as recent

migrationresearch suggests.

Considering the household as a spatialscale

can illuminate its structural relations with other

scales,and bringtotheforetheinterconnections

Hotelling model

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