The aim of this research is to evaluate future retail developments in a medium-sized town and the indirect effects of individual behaviour on the local economy. Therefore we combine a spatial microsimulation model with a conditional logit model estimating the spatial shopping behaviour of households to simulate the effect of future retail developments. Then, we estimate the macro effects of these developments, mainly the effects on the retail sector, with help of an interregional SAM on town level. This analysis shows how different locations for retail developments have different impacts on households and firms in the local economy. © 2010 the author(s). Papers in Regional Science © 2010 RSAI.