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External economies of scale result from an increase in the productivity of an entire industry, region, or economy due to factors outside of an individual company. There are three sources of external economies of scale: input sharing, labor market pooling, and knowledge spillovers (Marshall, 1920). [1] Localization economies occur when an ...
Economic geography takes a variety of approaches to many different topics, including the location of industries, economies of agglomeration (also known as "linkages"), transportation, international trade, development, real estate, gentrification, ethnic economies, gendered economies, core-periphery theory, the economics of urban form, the ...
In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, and are typically measured by the amount of output produced per unit of cost (production cost) . A decrease in cost per unit of output enables an increase in scale that is, increased production with lowered cost. [1]
A traditional economy is a loosely defined term sometimes used for older economic systems in economics and anthropology. It may imply that an economy is not deeply connected to wider regional trade networks; that many or most members engage in subsistence agriculture, possibly being a subsistence economy; that barter is used to a greater frequency than in developed economies; that there is ...
Location theory has become an integral part of economic geography, regional science, and spatial economics. Location theory addresses questions of what economic activities are located where and why. Location theory or microeconomic theory generally assumes that agents act in their own self-interest. Firms thus choose locations that maximize ...
When industries cluster, like in Silicon Valley in California, they create urban areas with dominant firms and distinct economies. By looking at location decisions of firms and households, the urban economist is able to address why cities develop where they do, why some cities are large and others small, what causes economic growth and decline ...
In economics, the economics of location is the study of strategies used by firms and retails in a monopolistically competitive environment in determining where to locate. [1] Unlike a product differentiation strategy, where firms make their products different in order to attract customers, an economics of location strategy is consistent with ...
Economies of scale external to a firm result from spatial proximity and are called agglomeration economies of scale. Agglomeration economies can be seen as the external condition for companies and the internal condition for the region. Increasing returns to scale, according to Beckmann, is integral to understanding why urban centers form.