Theories of manufacturing location have had a long history, but no previous book has attempted to relate them to specific studies of actual industrial location. This book, seventh in the M.I.T. series of Regional Science Studies, does just that; aware that “theoretical deliberations have the habit of turning in upon themselves, tending to grow more and more remote from reality,” the authors take stock of the existing theoretical literature and link it with some of the individual studies. The book is a review of works, presented in their entirety, by such eminent economists and regional scientists as William Alonso, Peter Isard, Walter Isard, and Raymond Vernon.
While relying on empirical studies for verification, Drs. Karaska and Bramhall maintain that a logical abstract model of the geometric interrelationships of the region provides the most meaningful framework for analysis. The manufacturing establishment is one basic unit in the spatial organization of manufacturing. Any change in the spatial organization of the elements in the region reverberates throughout the whole area. The aim of regional science, therefore, is to determine the action space of all possible configurations of manufacturing distribution and to predict the effect of changes in the existing patterns. In turn the authors isolate and examine in detail key factors which influence industrial location decision-making. Their discussion focuses upon factors such as transportation costs, labor costs, power costs, taxes, scale and agglomeration economics, demand and revenue potentials, competition and decision-making procedures. Drs. Karaska and Bramhall deduce two main lines of theory from the literature. The first, a partial equilibrium theory, holds constant such units as locations and space. The second is a general equilibrium theory which recognizes the interdependency of all factors in the economic system, but it is unsatisfactory as a model of the real world because it refers to an ideal state and consequently its complexity and evasiveness have confined its exposition to the bookshelf of theory, devoid of empirical evidence. Questioning the adequacy and comprehensiveness of these two theories, the authors arrive at a complex equation for location decision-making with maximization of profit as the prime objective. Cost and revenue factors in this equation themselves vary as a function of time and human efficiency and changes in the total environment such as technology, nature, politics, and competition.
