ALFRED WEBER’S LEAST THEORY OF

INDUSTRIAL LOCATION

MADHUSUDAN PRAMANICK

Assistant ProfessorDepartment of Geography

madhusudan94333@gmail.comMob. 0-9433402382

(1868-1958)

(For B.A/ B.sc Part -I Hons.)

Alfred Weber (1868-1958) formulated a theory of industrial location in which an industry is located where it can minimize its costs, and therefore maximize its profits. Weber’s least cost theory accounted for the location of a manufacturing plant in terms of the owner’s desire to minimize three categories of cost: Transportation, Labour and Agglomeration

LEAST COST THEORY

Weber’s Assumptions A country or region is homogeneous in terms of culture, climate, topography, race of people, technical skills of the people and political system. Raw materials are two types: i) Ubiquitous-water air, sunshine etc. and ii) Localized- iron ore, coal etc. a) Pure raw material b) Impure raw material. There are fixed locations of labour where wage rates are fixed and labor is immobile and unlimited.Transport cost is directly proportional to the weight and distance travelled.Product of goods in a market is unlimited demand and perfect competition exists.

POSTULATIONSThe Factors that control the location of industries are as under:

I) Role of Transport Cost,

II) Role of Labour Cost and

III) Role of Agglomeration of Industries.

Role of Transport CostTransport Cost depends on- a) Assembly cost and b) Marketing Cost.Based on transport cost least cost depends on Material Index(MI),MI=[ Weight of Raw Material/ Weight of Product]MI= >1, Raw oriented location,MI= <1 Market oriented location and MI= 1 Industry may be located either at the source of raw material or at the market place depends on nature of raw material and distance.

ISOTIM:Lines joining points of equal transport costs of commodity.

ISODAPANE: Lines joining points of equal total transport cost

Condition: 1 One raw material and one market, Ubiquitous raw material- at the market center.

Localized and pure raw material- Industry may be located either at the source of raw material or at the market place.

Impure or Weight raw material – At the source of raw material.

Condition: 2 Two raw materials and one market,A) Two Ubiquitous Raw material - at the

market center.B) Two Ubiquitous Raw material( One localized

and another pure raw material- at the market center.

C) One ubiquitous raw materials and another impure – At the source of weight losing raw material.

D) One impure and another pure raw material -At the source of weight losing raw material.

E) Two pure raw materials- at the market center.

F) Two impure and localized raw materials- This condition should be analyzed by locational triangle .

A complex situation may arise if both the required raw materials are localized impure or weight-losing the raw materials and market are at an equilateral triangle (suppose 100 in each direction) . Suppose to produced 1000 tonnes finished product, the required raw materials from each source is 2000 tonnes, and rate of transport cost is Re. 1 per tonne per kilometre , the cost structure of the four possible locations will be as under:

If the industry is to be located at R1, the total transport cost will be :[(2000 tonnes× 100 Km × Re 1)+ (2000 tonnes× 100 Km × Re 1)]=Rs.40000

If the industry is to be located at R2, the total transport cost will be :[(2000 tonnes× 100 Km × Re 1)+ (2000 tonnes× 100 Km × Re 1)]=Rs.40000

If the industry is to be located at M, the total transport cost will be :[(2000 tonnes× 100 Km × Re 1)+(2000 tonnes× 100 Km × Re 1)]=Rs.40000.

If the industry is to be located at P, the total transport cost will be :

[(2000 tonnes× 50 Km × Re 1)+(2000 tonnes× 50 Km × Re 1) [(2000 tonnes× 86.6 Km × Re 1]=Rs. 3,73,200.

ROLE OF LABOUR COSTIt is describe with the help of given mathematical analysis. These are:Index of labour cost: It is the average cost of labour needed to produced one unit weight of output.Labour Co-efficient: It is the ration between cost per unit of product to the total weight of raw material and product to be moved.Critical Isodapane: Weber terms the isodapane which has the same value as the saving in labour cost the critical isodapane.

ROLE OF AGGLOMERATION OF INDUSTRIES

It is clear that agglomeration of could reduced their total cost by locating in the shaded of critical isodapane, industry must locate of that site.

CRITICISMSTransport cost s do not rise proportionally with distance and weightPerfect competition of market rarely exists.Weber ignored the spaced problem, high cost of land and high rent in the industrial area.Historical factors do not have been considered in the location of industry.Impact of price fluctuation does not consider.Break of bulk point do not has been considered.Homogeneous areas have been questioned.

CONCLUSIONThe theory is important because of its pioneering nature and its effects on later researchers .The real test of theory is that it should accord with reality, and empirical studies as Isard’s work on US Steel Industry and Smith’s works on weight- losing in Britain have, however, shown the validity of many weber’s conclusion

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