Lokasi Industri (Kul 26 Jan 2008)

7/26/2019 Lokasi Industri (Kul 26 Jan 2008)

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Session IIINDUSTRIAL LOCATION

McCann 2001

Urban and Regional Economics

Kuliah Ekonomi Regional

Sabtu, 26 Januari 2007D.S. Priyarsono


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McCann 2001

URBAN AND REGIONAL ECONOMICS

1. Industrial Location: The Location of the Firm inTheory

2. The Spatial Distribution of Activities

3. The Spatial Structure of the Urban Economy

4. Regional Specialization, Trade, and MultiplierAnalysis

5. Regional and Inter-Regional Labor MarketAnalysis

6. Regional Growth, Factor Allocation, andBalance of Payment

7. Urban and Regional Economic Policy Analysis


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Capello 2007

REGIONAL ECONOMICS

1. Agglomeration and Location2. Accessibility and Location

3. Hierarchy and Location

4. Productive Structure and Development

5. Demand6. Factor Endowment

7. Territorial Competitiveness and ExogenousDevelopment

8. Territorial Competitiveness and EndogenousDevelopment

9. Territorial Competitiveness and CumulativeDemand/Supply Growth

10. Territorial Competitiveness and Endogenous Growth

11. Toward a Synthesis


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INDUSTRIAL LOCATION

The Location of the Firm in Theory

1.Introduction (Blair & McCann)

2.The Weber Model

3.The Moses Model

4.Market Area Analysis5.Behavioral Theories of Firm Location


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1.1 INTRODUCTION TO

CLASSICAL AND NEOCLASSICAL

MODELS OF LOCATION

Factors of output (economic activity) and

wealth Variation over regions: population density,

investment, wages, land prices

What determines the level and type ofcapital invested in a particular region?


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LOCATIONAL FACTORS Inertia

Transportation Cost

Production Costs

Labor Costs

Quality of Life Taxes

Government Incentives

Local Business Climate

Site Costs

National Political Climate and Stability

Energy Costs


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1.2 THE WEBER

LOCATION-PRODUCTION

MODEL

Weber location-production triangle

Two inputs, one output, fixed input-output

relationship, perfect competition

TC = Min mitidi

TC= Transport Cost

m weight, ttransport rates, ddistance


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The Weber Model: The Location

Effect of Input Transport Cost Output: car

Input 1: steel, input 2: plastic

Car (2 tons) = steel (1 ton) + plastic (1 ton)

Scenario 1: transporting plastic is more

expensive than transporting steel

Scenario 2: composition of inputs changes

Location effect?


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Effect of Output Transport Costs Output: electricity

Input 1: coal, input 2: coke

Output transport cost almost zero, one

dimensional location problem

Scenario 1: Firm A discards 70% of the

production process, firm B 40%

Scenario 2: bulkiness of the product


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Effect of Varying Factor Prices

Isodapane analysis

Distance-isodapane equilibrium labor prices

Inter-regional equilibrium wage gradient


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The Weber Model:

The Locational Effect of NewInput Sources and New Markets

New suppliers and new markets

Key features of The Weber Model:

Price conditionlocations for investment

Evolutionary process: changes in factor prices

changes in location behaviorchanges in

supply linkages (suppliers-firms-markets)


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1.3 THE MOSES LOCATION-

PRODUCTION MODEL

Firms will substitute in favor of relatively

cheaper inputs. Weber Moses Triangle

Budget constraints at the end pointsIandJ

The envelope budget constraint The optimum input mix and the optimum

location of the firm are always jointlydetermined


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The Moses Model:

Comparative Statics Price changes and loc-prod behavior

Output changes and loc-prod behavior

(IfIJis not fixed), the optimum location will

be independent of the level of output, as long

as the prod fn & transp tech are constant return

to scale. Prod behavior and loc behavior are completely

intertwined issues --- overlooked in

discussions of industrial ec. and th. of the firm


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The Moses Model:

Limitations & Extensions Limitations:

Market price of output good plays no role

The emphasis of transport costs as a locationalissue

Extensions:

The logistics-costs model, from distance-transport costs to total logistic costs.


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1.4 MARKET AREA ANALYSIS:

SPATIAL MONOPOLY POWER Spatial market areas: a one dimensional

model with equal transport rate

Spatial market areas: one dimensionalmodels with varying transport rates and

production costs


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The Hotelling

Model of Spatial Competition The Hotelling location game

The welfare implications

The effect of price competition

Other applications of Hotelling Model:

Industrial economics: Product differentiation

Politics: Election


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1.5 BEHAVIORAL THEORIES

OF FIRM LOCATION Firms make decision to achieve alternative goals,

other than simply profit maximization.

Bounded rationality: limited information available Conflicting goals: max. profit, sales, market share,

efficiency, min. industrial disputes

Relocation costs.

Relocation is not used as competitive weapon

Behavioral approach is not prescriptive


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DISCUSSION QUESTIONS How does the location of input sources and output

markets determine the location behavior of thefirm?

To what extent are firm-locational changesdependent on the substitution characteristics of the

firms production function? In what ways can space confer monopoly power?

What role can location play in the competitivestrategy of firms, and how are location and price

strategies interrelated? What role do logistics costs play in determining

location behavior?

What insights are provided for industrial location

analysis by behavioral theories of firm behavior?

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Lokasi Industri (Kul 26 Jan 2008)