Economies of density: Difference between revisions
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In microeconomics, '''economies of density''' express cost savings resulting from spatial proximity of suppliers or providers. Typically higher [[Population density|population densities]] allow synergies in service provision leading to lower unit costs.<ref>{{cite web|url=http://www.encyclo.co.uk/meaning-of-Economies%20of%20Density |title= Economies of Density|accessdate=2015-08-06 |publisher=Enlish Encylopedia }}</ref> | In microeconomics, '''economies of density''' express cost savings resulting from spatial proximity of suppliers or providers. Typically higher [[Population density|population densities]] allow synergies in service provision leading to lower unit costs.<ref>{{cite web|url=http://www.encyclo.co.uk/meaning-of-Economies%20of%20Density |title= Economies of Density|accessdate=2015-08-06 |publisher=Enlish Encylopedia }}</ref> If large economies of density exists there is an incentive for people to concentrate and agglomerate.<ref>{{cite web|url=https://www.philadelphiafed.org/research-and-data/publications/business-review/2012/q3/brq312_geography-history-economics-of-density-location-of-cities.pdf |title= Geography, History, Economies of Density, and the Location of Cities.| author= Jeffrey Lin |year=2012}}</ref> | ||
Economies of scale are not to be confused with [[economies of scale]] where unit costs are not linked to spatial properties. | Economies of scale are not to be confused with [[economies of scale]] where unit costs are not linked to spatial properties. | ||
Revision as of 12:41, 6 August 2015
In microeconomics, economies of density express cost savings resulting from spatial proximity of suppliers or providers. Typically higher population densities allow synergies in service provision leading to lower unit costs.[1] If large economies of density exists there is an incentive for people to concentrate and agglomerate.[2]
Economies of scale are not to be confused with economies of scale where unit costs are not linked to spatial properties.
Examples
Typical examples are found in logistic systems such as the distribution of goods (e.g. delivery of mail). Different network infrastructures such as electricity networks show as well show economies of density.
References
- ↑ "Economies of Density". Enlish Encylopedia. http://www.encyclo.co.uk/meaning-of-Economies%20of%20Density. Retrieved on 2015-08-06.
- ↑ Jeffrey Lin (2012). "Geography, History, Economies of Density, and the Location of Cities.". https://www.philadelphiafed.org/research-and-data/publications/business-review/2012/q3/brq312_geography-history-economics-of-density-location-of-cities.pdf.