One of the major subfields of urban economics, economies of agglomeration (or agglomeration effects), explains, in broad terms, how urban agglomeration occurs in locations where cost savings can naturally arise. This … See more

When firms form clusters of economic activity, particular development strategies flow into and throughout this area of economic activity. … See more

Two types of economies are considered large-scale and have external economies of scale: localization and urbanization economies. … See more

From the localization of firms, labor market pooling emerges. Large populations of skilled laborers enter the area and can exchange knowledge, ideas, and information. The … See more

While the existence of cities can only persist if the advantages outweigh the disadvantages, agglomeration would also lead to traffic … See more

While localization and urbanization economies and their sources are crucial to sustaining agglomeration economies and cities, it is important to understand the long-term result of the function of agglomeration economies, which relates to the See more

• Cluster effect
• Cluster initiative
• Business cluster
• Hotelling's law
• Economies of density See more