Weber's

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Weber's

  1. 1. WEBER’S THEORY OF LOCATION
  2. 2. WHO WAS ALFRED WEBER? Alfred Weber  (30 July 1868 – 2 May 1958) was a German economist, sociologist and theoretician of culture whose work was influential in the development of modern economic geography.
  3. 3. LIFE OF WEBER
  4. 4. From 1907 to 1933, Weber was a professor at the University of Heidelberg until his dismissal following criticism of Hitlerism.
  5. 5. WEBER’S THEORY OF LOCATION
  6. 6. ASSUMPTIONS OF WEBER’S THEORY OF LOCATION
  7. 7. <ul><li>The centre of consumption are fixed </li></ul>PRODUCTION MANUFACTURE OF PARTS ASSEMBLY OF PARTS FOR FINISHED GOODS PACKAGING OF FINISHED GOODS
  8. 8. <ul><li>The cost of raw material is the same at all places even though the distribution of deposits of raw materials is uneven . </li></ul>
  9. 9. <ul><li>There are fixed centres of labour supply and they have unlimited supplies of labour at cost </li></ul>
  10. 10. <ul><li>Transport cost depends upon weight of material and distance </li></ul>
  11. 11. FACTORS INFLUENCING LOCATION OF PLANTS <ul><li>Primary or regional factors </li></ul><ul><li>Secondary or agglomerative and deglomerative </li></ul>
  12. 12. PRIMARY FACTORS <ul><li>These factors influence the location of plants over different regions. </li></ul><ul><li>Weber developed his theory on the basis of two regional factors:- </li></ul><ul><li>Transportation cost </li></ul><ul><li>Labour cost </li></ul>
  13. 13. Transportation cost
  14. 14. TRANSPORTATION A plant tends to be located at a site where the total cost of transportation of materials and products is minimum Wheat field Factory
  15. 15. Transport cost is dependent on 2 basis
  16. 16. <ul><li>The weight to be transported </li></ul>
  17. 17. <ul><li>Distance to be covered </li></ul>
  18. 18. Weber classified materials in 2 forms:- <ul><li>Ubiquitous materials </li></ul><ul><li>Localized materials </li></ul>
  19. 19. Ubiquitous materials These materials are present everywhere. Example:- water, air etc
  20. 20. Localized materials These materials are confined to a particular region. Example:- iron, gold, cotton etc
  21. 21. Localized materials can be further divided into:- <ul><li>Pure materials </li></ul><ul><li>Gross materials </li></ul>
  22. 22. Pure materials <ul><li>Pure or non-weight loosing materials do not loose their weight in the process of production. </li></ul><ul><li>Such materials do not pull plants to their place of deposits. </li></ul><ul><li>Example:- cotton, wool etc </li></ul>
  23. 23. Gross materials <ul><li>Gross or weight-losing materials impart a small part or none of their weight to the finished product. </li></ul><ul><li>Such materials attract production towards places of deposits . </li></ul><ul><li>Example:-sugarcane farms, coal etc </li></ul>
  24. 24. Material index On the basis of the above reasoning Weber developed a mathematical formula to measure the relative pull of materials while those with low materials and the market on industrial location.
  25. 25. Material index=weight of localized material/weight of the finished goods <ul><li>If material index > 1 then plant will be located near the resources . </li></ul><ul><li>If material index < 1 then plant will be located near to the market. </li></ul>
  26. 26. Labour cost <ul><li>Cost incurred to employee workers </li></ul><ul><li>These costs directly effects the production of the firm. </li></ul>
  27. 27. A plant may deviate from the point of least transportation cost when the savings in labour cost are greater than the additional cost of transportation at the new centre. Least transportation cost Resources Factory
  28. 28. Isodapanes Isodapanes represent points of equal transportation cost including assembling cost of materials and distribution cost of finished product.
  29. 29. Critical Isodapane It is a point where Transportation cost = Labour cost i.e. where both labour cost and transportation cost are minimum as compared to their total cost any where else.
  30. 30. A point where both the costs are minimum Optimum place for a factory resource labour
  31. 31. Labour costs depends upon:-
  32. 32. <ul><li>Labour cost per unit </li></ul>It is measured by labour cost index i.e. proportion of labour cost to the weight of the finished product.
  33. 33. <ul><li>Locational weight </li></ul>It is the weight to be transported during the process of production.
  34. 34. To measure the attracting power of labour, Weber gave the following formula:- Labour Coefficient=labour cost index/ locational weight Higher the labour coefficient , greater is the tendency for a plant to be located near the centre of cheap labour supply.
  35. 35. Secondary Factors <ul><li>Secondary factors lead to concentration or dispersal of industries. They are;- </li></ul><ul><li>Agglomerative </li></ul><ul><li>Deglomerative </li></ul>
  36. 36. <ul><li>Agglomerative </li></ul>Agglomerative factors are the external economies which result from concentration of industries at a particular place
  37. 37. <ul><li>Deglomerative </li></ul>These are external diseconomies that causes geographical dispersal of industry.
  38. 38. Index of manufacture Index of manufacture = total manufacturing cost/locational weight
  39. 39. Critical appraisal of Weber’s theory
  40. 40. <ul><li>There are no fixed centre of consumption </li></ul><ul><li>Transportation rates are not uniform </li></ul><ul><li>Fixed centers with unlimited supply of labour is not true </li></ul>Wrong Assumptions
  41. 41. <ul><li>Not empirically proved </li></ul>
  42. 42. <ul><li>Classification of raw materials is arbitrary </li></ul>
  43. 43. <ul><li>Complex mathematical coefficients </li></ul>
  44. 44. Conclusion
  45. 45. The end all feedbacks are welcome (specially the critical ones)

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