This presentation is part of: R10-2 Spatial Economics and Regional Development

Agglomeration Economies, Transportation Costs and Weber-Moses Approach

Daisuke Nakamura, Ph.D., Regional Economics Applications Laboratory (REAL), University of Illinois at Urbana-Champaign, 607 S. Mathews, #318, Urbana, IL 61801-3671, Urbana, IL 61801-3671

The location-triangle model, which was originally established by Alfred Weber (1909), has been expanded in various ways and generalized as the Weber-Moses model.  However, it is found that several essential elements, in particular, regarding agglomeration economies have been dropped from the model framework.  This causes a potential difficulty to connect location-triangle framework with recent spatial economic analysis.  In this paper, an alternative hypothetical analysis is introduced to the existing location-triangle approach, including the neglected notion of agglomeration economies together with the roles of transportation costs.  In addition, an applicability of the alternative framework to the new economic geography is also explored.