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Published byProsper Burke Modified over 9 years ago
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Weber ’ s model on industrial location
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Explicit assumptions Natural resources Markets Labour Transport costs Unevenly distributed (ubiquitous/localized) Fixed On a plain Fixed Immobile unlimited supply At given wage rate Weight + distance of transport
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Implicit assumptions Uniform surface Fixed capital Perfect competition Economic men
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Cost factors affecting industrial locations Transport costs Labour costs Cost of proximity (agglomeration/deglomeration)
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Varignon frame
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Material Index total weight of localized raw materials used =--------------------------------- weight of finished products
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Line graphs
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Location triangle
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Isodapane
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Labour factor
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the LTCL may not coincide with the cheapest labour site especially significant for attractive labour-intensive industries If the saving in labour cost is greater than the increase in transport cost, he will move to the cheap labour cost site
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Labour factor Critical isodapane = transport cost at LTCL + labour cost savings at source of cheap labour If the source of cheap labour is inside the critical isodapane, the location is a profitable one (and vice versa).
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Critical isodapane
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Agglomeration factor
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Further exercise
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