Alfred Weber’sLeast Cost Theory of Industrial

Transportation

Three Parts to the Theory

1. One must consider LABOR costs in finding the best place for an industry

2. One must consider TRANSPORTATION costs when deciding where to put an industry (this cost is the biggie)

3. One must consider AGGLOMERATION – it would be best to have an industry where agglomeration has/is occurring

This triangle deals with the transportation costs part of Weber’s Least Cost Theory on Industrial Location. His theory is based on looking at the location of raw materials, the location of the market, and transportation costs.

RAW MATIERIAL

RAW MATERIAL

MARKET

Alfred Weber’s Least Cost Theory of Industrial Transportation

Weber’s Ideas About Transportation Costs• Weber presented a mathematical summary of

the model developed with the help of a mathematician colleague.

• It presented methods for calculating "locational triangles" in the placing of industry between raw materials and markets.

• Example: In figure 1, C1 and C2 are the source of raw materials and M is the market. If equal transport costs are assumed in all directions, the least-cost location, P, is derived from the "pull" from all three corners.

• Weber used a Verignon frame (Figure 2) to help physically calculate the points using weights to represent transport costs.

Locational Triangle

• The locational triangle ties into whether an industry is bulk-gaining (weight-gaining) or bulk-reducing (weight-reducing).