1. Agglomeration & Dispersion

2. Industrial Agglomeration
Clustering or concentration of industrial activities in a comparatively small area
a process which encourages the clustering of industrial activities in particular areas
because of external economies of scale

3. Specialization Economies of Scale experienced workers
higher efficiency
expertise
research and development

4. Measurement
Coefficient of Localization
Location Quotient
Lorenz Curve

5. Line of even distribution

6. Linkages Production unit Subcontract Information Service links links
Marketing
links

7. Vertical linkages Garment Factory Cloth Textile Factory
Synthesis fiber
Chemical factory

8. Horizontal Linkages Glass-making Factory Iron & Steel Factory Engine
Tyre-making
Factory
Motor car
assembly factory

9. Diagonal Linkages Jam- Fruit bottling Ice cream making canning Sugar
refinery
Glass bottle
factory
Sugar mill

10. Agglomeration Economies
Transfer economies
shorter distance for assembly of raw materials and distribution of products
Localization economies
specialization/division of labour
bulk purchase of raw materials
prestige & advertising advantage
presence of ancillary services
saving of storage
a pool of skilled labour and managerial expertise

11. Urbanization economies
a pool of skilled labour and managerial expertise
infrastructure savings
snowballing effect
research & development
attracting investment

12. Diseconomies of scale Physical Economic shortage of land for expansion
shortage of labour
traffic congestion
urban decay
Economic
rising rent
rising labour cost
high tax

13. Social pollution / environmental problems high crime rate
pressure from labour union
pressure from green groups
government policy

14. Industrial Inertia Existing linkages
loss of skilled , experienced worker
high cost of relocation
risk of relocation
personal & behavioural factors
reputation & prestige