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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 ...
In Hotelling's Location Model, firms do not exercise variations in product characteristics; firms compete and price their products in only one dimension, geographic location. Therefore, traditional usage of this model should be used for consumers who perceive products to be perfect substitutes or as a foundation for modern location models.
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 ...
Location theory includes a number of theories and techniques for determining the optimal location to site a particular activity, based on minimizing travel costs. Notable examples include the classical early 20th Century theories of Johann Heinrich von Thünen, Walter Christaller, and Alfred Weber, and GIS-era algorithms for Location-allocation.
Soja's concept of Thirdspace "breaks the Firstspace-Secondspace dualism and comprises such related concepts as 'place, location, locality, landscape, environment, home, city, region, territory and geography' (50) that attempts to come to terms with the representational strategies of real and imagined places.
The gravity model estimates the pattern of international trade. While the model’s basic form consists of factors that have more to do with geography and spatiality, the gravity model has been used to test hypotheses rooted in purer economic theories of trade as well. One such theory predicts that trade will be based on relative factor abundances.
[1] The bid rent theory is a geographical economic theory that refers to how the price and demand for real estate change as the distance from the central business district (CBD) increases. Bid Rent Theory was developed by William Alonso in 1964, it was extended from the Von-thunen Model (1826), who analyzed agricultural land use.
The model is more detailed than the traditional down-mid-uptown divide by which downtown is the CBD, uptown the affluent residential outer ring, and midtown in between. Bid rent curve. Burgess's work helped generate the bid rent curve. This theory states that the concentric circles are based on the amount that people will pay for the land.