SPATIAL-COMPETITION, INTEGRATED FRAMEWORK OF CENTRAL-PLACE SYSTEM WITH AGGLOMERATION ECONOMIES

It is argued that the trade-off interaction between agglomeration economies and transportation costs cannot be excluded from the analysis of the central-place system. First, an overlapping-area model between two competitors of market areas is examined both cases in homogeneous and differentiated products together with the relevant formation of supply areas. The analysis then further explores an exclusive-area model in the duopoly and oligopoly conditions of market areas and the formation process of supply areas. Finally, consideration is given to the methodological connectivity between central-place system and agglomeration economies.