What is agglomeration of industries? Explain it's benefits.
Answers
*Agglomeration is a phenomenon: it refers to the spatial clustering or concentration of industrial activities in a relatively small area. Agglomeration is a process: it refers to the snowballing process whereby more and more manufacturing firms cluster or a really concentrate in a relatively small area.
*Benefits arise from the spatial agglomeration of physical capital, companies, consumers and workers: Low transport costs. A great (local) market. A large supply of labor and thus the increased chance of supply and demand for labor, particularly for specialists to compensate for fast matching, lower search costs.
*There are actually two major categories of agglomeration: Urbanization economies and Localization economies. The term urbanization economies refers to benefits that firms in a number of different industries receive from population and infrastructure clusters. A great example of this is a shopping mall.
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Agglomeration seems to be a popular approach used in a wide variety of applications or industries, from farming to manufacturing to pharmacy goods. Some benefits are given below.
Explanation:
- This method provides a multitude of benefits, some of which are increasingly important in the current's global marketplace.
- Connect to professional or qualified labor.
- Involvement of reparations.
- Support, sustainment, and maintenance equipment.
- Economic organizations in attendance.
- Element or product availabilities.
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