The Four Main Locational Influences of Transportation

The Four Main Locational Influences of Transportation

The influence of transportation over the location of economic activities takes place over four main aspects, at times interdependent:

  • Transport costs. One of the most straightforward influence involves the costs that transport imposes on the mobility of passengers and freight. Location is therefore influenced by the goal of minimizing the total cost of transportation, which is the foundation of classic location theory.
  • Agglomeration economies. Lower input costs with the clustering of economic activities, which is permitted by the accessibility that transportation infrastructures, such as roads, can provide to a user/customer base.
  • Economies of density. Based on the general benefits of higher densities such as a higher level of accessibility to labor, goods and services and lower unit distribution costs. Higher densities are only possible with high capacity transportation infrastructures.
  • Co-location. The benefits that economic activities derive from being located directly adjacent to a transport terminal facility such as a port, an airport, a rail terminal or a public transit station. The efficiency of the economic activity is in part derived from the transport capacity offered by the terminal.