Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
10480300 | Mathematical Social Sciences | 2013 | 9 Pages |
Abstract
This paper studies the impact of economies of scale in transportation on a firm's location decision. We relate the location problem to weighted Fermat problems and ramified optimal transportation problems and analyze how transport technologies affect the firm's transportation and location choices. It is found that in general when the level of transport economies of scale is high, the firm locates its factory in the interior of the Weber triangle with a branching transport structure. Two examples are constructed to illustrate how interactions between transport technology and production technology would affect the firm's input purchase and factory location.
Related Topics
Physical Sciences and Engineering
Mathematics
Applied Mathematics
Authors
Shaofeng Xu,