Question

How are agglomeration economies formed?

Answer 1

When multiple Multi national companies come together to set up their factories in a particular area where there is a Special economic zone funded by the government , then an agglomeration economy is formed.

Answer 2

Agglomeration economies formation.

Explanation:

• The economies of agglomeration are the cost-saving that is a form of urban economics and is often located near to each other and is related to the economics of scales.  

• These economies cluster together in order to reduce the cost and improves productivity with greater specialisation and a division of labour as to facilitate economic activities.

• They tend to share the advantages due to the clustering as the SEZ or an airport due to the concentration of the economic activities in the cities leads to development and growth.

• The certain disadvantage is also present as the concentration in one area leads to high land prices, lack of reserve areas, and economic inequality. It also faces strong environmental pressure.

Learn more about the agglomeration economies formed.

• brainly.in/question/2321075 answered by Dhruvsh.