The Elasticity of the Office Space Market in Poland: Looking for the London Effect
The Elasticity of the Office Space Market in Poland: Looking for the London Effect

Summary/Abstract: Purpose: The article concerns elasticities of demand on the office space market. The article presents indicated in the literature reasons for discrepancies in the magnitude of elasticities of demand on local office space markets. The purpose of the article is to verify the presence of the so -called London effect on the Polish office space market. Methods: The verification of the hypotheses stated in the study was carried out by comparison of the calculated price and income elasticities of demand on the office space markets in Warsaw, Krakow, Wroclaw and Poznan. For the purpose of the study two econometric models were formulated with the use of the Error Correction Model approach. Findings: The London effect was verified on the four major office space markets in Poland. To this end, two research hypotheses were formulated, stating that price elasticity of demand and income elasticity of demand on the office space market in Warsaw are lower in magnitude than on the markets in Krakow, Wroclaw and Poznan put together. Based on the study, the presence of the London effect on the four major office markets in Poland cannot be unambiguously confirmed. Research implications: Dependencies between the rent and the number of employees and the need for office space are different in Warsaw than on the office space markets in Krakow, Wroclaw and Poznan.

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