On the space curve and industrial location

This paper presents a formal mathematical model to investigate the properties and shape of the space cost curve in the Weber-Moses type triangle space. It also examines the theoretical impacts and implications of the space cost curve on the optimum location decisions of the firm. We have shown that the shape of the space cost curve crucially depends upon the marginal transport costs with respect to distances. When the transport rates are constant, the space cost curve may be linear, convex or concave from below in the distant plane. This result is quite different from Smith's (17, 19), Richardson's (13) and Mai's (9). Furthermore, we have shown the convex space cost curve is an important condition for the existence of the optimum intermediate location. This is consistent with Haddah and Schwartzman's empirical study (5).The author is grateful to Professors H. Ohta, C. C. Mai and K. Hohlt for valuable help. Needless to say, any possible errors are due to the author.