Sargent Florence Theory Of Industrial Location Pdf

Sargent has used two new concepts in his theory of location. Sargant Florence has given his theory about industrial location, which has become popular. Examine the importance of location factor in Florencess theory. The theory claims that the costs will get influenced by transportation costs, labour costs and by the agglomeration factor.

Sargent Florence Theory Of Industrial Location Pdf 23

This is the reason why Webers approach is known as the least cost approach to the theory of industrial location. The theory tells only whether the industry is centralized or decentralised but does not give the causes of such a tendency.

His main consideration is that occupational distribution of population should be the main and primary factor for taking into consideration the location of an industry. The limitation of this concept is that it is not suitable in case of new industries. Define the Agglomerative and Degglomerative factors. Now a question arises as to what is location factor.

Theories of Industrial location-1

It is said that the theory is only the investigation of status quo and nothing beyond that. With the help of coefficient of localization all the industries can be classified into three classes as high, medium and low coefficient industries. Thunen, considered the problem of location for various forms of agricultural production in relation to markets.

If quotient is above unity, then the conclusion can be that the region under reference has higher share of industry. It is possible that other farms may also produce surplus beer which they would like to sell in the market. But the theory has its advantages too.

Then another advantage is that coefficient of localisation helps in deciding the types of industries that may be dispersed under a scheme of regionalism. Therefore, according to him, to achieve the maximum profit, they had to minimize cost.

However, the actual behavior of particular industries will depend on the index of value added through manufacture. He further assumes identical production, identical demand curves for each buyer of each product, and that transportation cost are proportional to distance. More From Appan Kandala Vasudevachary. The coefficient would be found out in this manner.

But our interest in this chapter is on industrial location, therefore let us concentrate immediately on industrial location theories. It follows that a rational producer would choose a location where lowest costs were incurred. If the percentage of workers over different areas is also given in percentage, the variance between the two percentages is divided by which give the coefficient of location. It will thus be a single figure for the industry and also for the country as a whole. The transportation charges are a product of the cargo weight and the distance carried by transportation.

The best location in this situation is the market, as that will simply eliminate the transportation costs for the manufacturing unit. While discussing the advantages of method Prof.

Industrial Management

Every such one sided orientation is wrong. In such a situation, the shape and size of market area will depend on the price of the product and the rate of transport cost.

These indices help in guiding the trends of industrial development in a country. As long as profits are made, new breweries will come to be established, each brewery having a circular market area. Agglomerating refers to an advantage or cheapening of production due to the concentration of industry. Andreas Predohl has pointed that Webers theory is more a selective theory than a deductive theory. Predohl is of the view that this shift of industry can be on account of certain additional advantages of the new location.

Professor Sargent has followed the inductive method in formulating his theory of location. After studying this lesson, you will be able to understand Meaning of industrial location Factors for industrial location Importance of different Location theories. The entire weight of the material from M has to traverse a distance a and material N a distanceb to reach the point of location T. Localized materials are those that tare available in certain areas only therefore excerpt an important influence on location. Each product will have a different network of market areas.

By this he meant prosperity of an industry for concentration. This technique is more reliable and accurate in calculating the degree of variation of dispersal and concentration of industries. Thus, a pull is being exerted on the location by each of these three modes. According to him, it is an index of the degree of concentration of an industry in a particular region. Suppose there is a farmer who produces beer over and above his requirements.

Sargant s Theory of Industrial Location (With Criticism)

Among them, the first attempt in developing a theory of location was made by a German scholar, Von Thunen, in regard to agricultural location. Whenever it is high, an industry has a tendency to agglomerate. His theory is mainly based on inductive analysis and while explaining location factor of an industry he has taken into consideration location factor and co-efficient of localisation. On the basis of coefficients it becomes possible to divide the industries into three categories namely high, medium and low. The two tendencies of agglomeration and deglomeration work in opposite direction and the final determination rests on the side of greater economy.

Florence Sargent developed two new statistical concepts relating to location of an industrial unit viz. After properly analyzing statistical data, yoga journal pdf Sargent tried to ascertain the tendency of location of industries.

Abhishek Venkitaraman Iyer. For example an industry may be shifted from one place to some other place.

Weber shows the impact of transportation costs on location and then demonstrates how labour costs and agglomeration and degglomeration may change this situation. Leave a Reply Click here to cancel reply.

Theories of Industrial location-1

Weber s Theory of Location of Industries (With Diagram)

The theory is of considerable use for studying location dynamics in any country. The coefficient being greater or less than unity will indicate tendency of centralization or decentralization respectively. Critically evaluate Webers theory of industrial location.

Theories of Industrial location-1