Spatial theory / The Location of Economic Activity

* Introduction

One of the most important and most complex problems, namely with regard to technological changes, and how to respond to these changes, and lasting change that occurs on the production, transportation, and distribution, requires all to reconsider the continued use of the land, and the validity of the place of production, in addition, The population movements from one place to another place, and constantly increasing populations, and transmission industries from one place to another, are factors that increase complicates economic activity, for all the issues of development, and in the development of the territories, and the transfer of industries, and population movements, all those factors affect negatively or positively.

Research on choosing the right place for economic activity, typically within the range of vague phrases, and it is understood the meaning, and this is proof that we need to better analytical method, we ask, for example, the meaning of some terms used currently, what words mean, balanced regional benefits or (Balance Regional Economics), Or a fair competition between regions (Fair Competition among regions), or manufacturing (Industrialization), or when you ask for words of decentralization (Decentralization), And does this phrase mean transmission industry to small towns, or increase the number of large industrial plants, or greater equality in the distribution of industry between regions, or transmission facilities from large cities to suburbs, decentralization means all these things to this day.

And we must not forget the availability of natural resources, which is one of the most important foundations that are being applied to them, The distribution of industry and population, and it is better to cultivate oranges in the County, and Wheat grown in the territory of another, then having a seaport in a third province, for distribution and marketing.

But these simple and direct relationship between the availability of sources, and places the economic activity, did not explain why the auto industry, and the wool industry in one region, And due to the overlap of additional factors in economic activity, and the most important of these factors are the economic interdependence between industries on the one hand, and between the various industrial installations.

And there is always a correlation between production units, which produce this coherence, in convergence between these production units, i.e. Choosing installation somewhere, May lead to new installations in the same place, and these enterprises are converging activity or activity is complementary to established first.

Then there is the coherence of economic, and between production and consumption, and the consumer market is determined on the basis of geographical distribution of per capita income, And this in turn depends on the place of production, and can say that changing economic place combined effect

(Cumulative), based on trying to choose a place near the market, and this in turn leads to increased market demand, all of this indicates it can not explain the choice of economic spaces, based on the distribution of natural resources and population.

And for that one has to understand this complex economic interdependence, one that through the stages, and in a study of all attractions and mutual payments, and affecting all productive unit, in order to choose the appropriate geographical location of economic activity.

And one must first consider the case of a consumer or producer, to understand the reasons for the preference of a specific place on another place, then trying to understand the foundations of economic interdependence between consumer and product, which lead to the creation of perfect models to different industries, locations and populations and territories.

* Spatial preference

-Transportation expenses

The distribution of production expenses, and expenses of obtaining raw materials, or raw materials, necessary for production, are important in a place, where calls to choose appropriate locations for production, either in or near market, near the source of the materials in the production process, and lead to the reduction of transport costs, , Which is why the attraction of the various stages of production.

And there are transportation requires certain commercial relations, and this means, rail, roads, trucks and cars, tubes, aircraft, animals of roads req rugged, conveyor belts for short distances, the manpower for small quantities, distribution (Self-Delivery), Electrical wiring for electric power distribution, telecommunications information transfer and trade negotiations.

And the greater the distance to move the product increased transportation expenses, as well as the rate of industrialization during the transport (Fabrication in transit rate), this situation represents, when milling wheat during shipment, or special arrangements on stopovers in certain places, for the complete manufacturing process, elements, And that prices move this article, and competition between the railway companies, for establishing wheat Mills, along the transmission lines, and to ensure that tugs on all wheat and flour, so it was an important factor leading to the establishment of such Mills most breakpoints.

And perishable goods, or dangerous, or goods fast break, for example, need special treatment in the process of loading and unloading, and all this increases costs.

* Impact of transport in the nvakat style, spatial (Locational Pattern)

Transportation costs can be reduced, through convergence between seller and buyer, and within a certain network of transportation, and that typically increases in benefits for the seller and buyer, But there are instances of one of the parties bears the most nvakat, and this of course may be due to one of the parties in interest, by trying to reach out to the other party, and this may increase the expenses of the other party, the other party is usually unaware of the factors driving this convergence.

There are some commercial establishments, and receiving orders via phone, then distribute goods within the city planning area, are usually all expenses of transporting this product, without regard to distance, therefore it is imperative that owners of these enterprises choose suitable place, so that they can reduce distribution costs.

* The impact of transport costs on industrial agglomeration

The spatial relationship between producers, competitors on the market, are usually divergent relationship, and that each party is trying to find a market less competitive, if this dissonance than in measuring all other spatial considerations, For that tend to spread geographically installations, and in line with the demand situation in the market, the commodity producers have, and if we assume the existence of a number of markets on the road transport network, linking cities, there will be one place can provide all these markets, And what usually happens is that one or more choose a specific place to provide glasses markets, while another product to choose another location to supply the nearby markets, and these markets can be considered, and which provide product or more, through one distribution center "marketing areas" (Market areas), And marketing areas represent only one area of spatial relationship, and there is also a "supply" (Supplay areas), and for materials, either spatial relationships usually involve mixing between the two regions.

The impact of geographic excellence in relation to the location of the seller, it is difficult, but the seller can reap immense benefits, and that if the seller near a market nearby.

* Production expenses and place the product

If we ask why the difference in the expense of producing a one of wheat, or different expense produce one metre of fabric, or the expense of producing a car of the same type, in the place and somewhere else, can answer in say, the higher expense of production may be, And production expenses can be tvesim into four types, are the following:

1. Production machines.

2. The place of production.

3. Labour.

4. General Government services, such as protection, road construction, etc.

And we have tried here to distinguish between the cost of production machines, and production location, although it is possible to consider that their income is interest or royalties, either in relation to the choice of location, we should distinguish between expenditure, and the value of the place, and decide which based on bidding, among those interested in that place, The value of productive machines decide based on the expense of replacing those machines, and expense application alternative (Alternative Demand), her in another geographical location.

The difference seems clear, if we consider the impact of geographical disparities, interest rates and taxes, and both interest and taxes, affect expenditure capital goods, that is, if other factors remained constant, that place of interest rate and high taxes, will increase expenditures, Either the expense maintain in place, not directly affected by the interest rate, or taxes on that place, and fixed location geographically, for that price place equals net earnings cap (Capitalization), After paying taxes on them.

Either product that aims to obtain abundant production, is trying to find a place that has the necessary production services, where you can produce goods at the lowest possible expense per unit of production, and this means that the prices of production factors, helps determine the relative benefits to the places of production.

* Spatial change

There are four main reasons to adhere in place (observe loci), and are the following:

1. seasonal reasons, (Seasonal reasons).

2. cyclical reasons, (Cyclical reasons).

3-time reasons or reasons of directivity, (Secular reasons).

4. the formative causes or systemic (Structural reasons).

And seasonal reasons or quarterly, where he tends the product and consumer, and within the limits of the ability to move, to change the location on a seasonal basis or quarterly, and consumer-related financial moves to sanatorium, and follow the product that the consumer, e.g. beekeeping, livestock, periodic causes is long and less than forecast, in seasonal changes, It is usually caused by fluctuation in the rate of general consultancy, which affects the total demand for the factors of production and consumer goods, and when the production rate increase unemployment among the factors of production, thus leading to stimulation in finding new places.

Temporal reasons is gradual change in a certain direction, and continues for a long period of time, such as the breeding population, for example, or the depletion of natural resources such as mines, systemic causes, resulting from technological developments, changes to the general trend in the industry in UN-announced.

* Impact of political borders for trade

Receive the differences between international trade and domestic commerce greater attention, and well-known politicians and business owners favour international trade policies, and do not have such policies more palatable in the field of domestic trade, such as support for protection and restrictions and currency exchange.

And inevitably, in that some economists assume responsibility in that, and so on because of neglect to confirm similarities in trade on a global scale and local, and because addressing such experts, the problems of international trade based on different assumptions, Believed in respect of local commerce, and place the other hand economic.

* Spatial goals and policy

The impact of government activity to choose the location of economic activity, is increasing with time, because of governmental authority affecting economic life, as the general budget, is in a continuing increase in the proportion of total income and individual expense, and we find we on the other hand, The economic impact to some extent on government economic policy, and Government or authority gives places where there are large interest Government consulting, this in addition to the Government considers itself, are responsible for lifting the regions and other territories and increase development, and improving general operating condition.

There is a certain measure for report, if certain economic policy, a policy that is really undesirable, because the regular outcome to any Government action, is to help certain groups or locations, and d in services, through the arrival of electricity and water to those places, And road construction, and may be in the interest of those economic groups at the expense of other groups, therefore, the best way to assess the effectiveness of any policy is through comparison, between benefits and damages that may result, and if greater benefits from damage, can be considered as economic policy, good policy.

The Location of Economic Activity

Edgar M. Hoover

#Economic