Question

2.Explain the development of agglomeration economies. (Write the answer in two complete
points).​

Answer 1

Answer:

Agglomeration economies exist when production is cheaper because of this clustering of economic activity. As a result of this clustering it becomes possible to establish other businesses which may take advantage of these economies without joining any big organization.

Agglomeration economies enhance the exchange of ideas generating innovation and improvements in the production systems of firms, increasing productivity and therefore the capital accumulation of a city. ... Thus the agglomeration economies influence on level of diversification or specialisation of the cities.

Explanation:

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Answer 2

Answer:

1) Agglomeration economies exist when production is cheaper because of this clustering of economic activity.

2) As a result of this clustering it becomes possible to establish other businesses which may take advantage of these economies without joining any big organization.

Explanation:

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