IDEAS home Printed from https://ideas.repec.org/a/sae/envira/v22y1990i11p1487-1496.html
   My bibliography  Save this article

Quantity-Discounted Transportation Rates, Location, and the Theory of Production

Author

Listed:
  • J P O'Brien

    (Department of Economics, School of Management, University of Alaska Fairbanks, Fairbanks, AK 99775-0580, USA)

  • Y-N Shieh

    (Economics Department, San Jose State University and University of Alaska Fairbanks, San Jose, CA 95192-0114, USA)

Abstract

The theoretical impacts and implication of quantity-discounted transportation rates on the optimum location decisions of the firm in the linear space are investigated. It is shown that the linearly homogeneous or homothetic production function alone no longer ensures the independence between the choice of plant location and the output level or the demand condition, unless (1) the elasticities of transportation rates with respect to quantity are constant and identical; and (2) the ratio of marginal products is equal to the ratio of marginal transportation costs. Moreover, and more importantly, some conclusions obtained by prior studies on location theory can be shown to be special cases of these more general results, but others are not defensible when the transportation rate depends upon quantity shipped.

Suggested Citation

  • J P O'Brien & Y-N Shieh, 1990. "Quantity-Discounted Transportation Rates, Location, and the Theory of Production," Environment and Planning A, , vol. 22(11), pages 1487-1496, November.
    • Handle: RePEc:sae:envira:v:22:y:1990:i:11:p:1487-1496
    DOI: 10.1068/a221487
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1068/a221487
    Download Restriction: no
    File URL: https://libkey.io/10.1068/a221487?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Miller, Stephen M. & Jensen, Oscar W., 1978. "Location and the theory of production : A review, summary and critique of recent contributions," Regional Science and Urban Economics, Elsevier, vol. 8(2), pages 117-128, May.
    2. Mai, Chao-Cheng & Shieh, Yeung-Nan, 1984. "Transport rates structure, optimum location, and theory of production: Reexamination," Journal of Urban Economics, Elsevier, vol. 16(2), pages 225-231, September.
    3. Shieh, Yeung-nan & Mai, Chao-cheng, 1984. "Location and the theory of production Clarifications and extensions," Regional Science and Urban Economics, Elsevier, vol. 14(2), pages 199-218, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yeung-Nan Shieh, 1988. "Variable Transportation Rates and The Profit-Maximization Location Theory of The Firm," Urban Studies, Urban Studies Journal Limited, vol. 25(4), pages 341-347, August.
    2. repec:ebl:ecbull:v:18:y:2004:i:1:p:1-7 is not listed on IDEAS
    3. Yeung-Nan Shieh, 2010. "The implications of quantity discounted transportation rates on output effect of spatial price discrimination," Letters in Spatial and Resource Sciences, Springer, vol. 3(2), pages 71-77, July.
    4. Yeung-Nan Shieh & Chiou-Nan Yeh, 2004. "Transportation rates, monopsony power and the location decision of the firm," Economics Bulletin, AccessEcon, vol. 18(1), pages 1-7.
    5. Philip Mccann & John H. LL. Dewhurst, 1998. "Regional Size, Industrial Location and Input-Output Expenditure Coefficients," Regional Studies, Taylor & Francis Journals, vol. 32(5), pages 435-444.
    6. Chao-cheng Mai, 1984. "Demand Function and Location Theory of the Firm Under Price Uncertainty," Urban Studies, Urban Studies Journal Limited, vol. 21(4), pages 459-464, November.
    7. Hong Hwang & Chao-Cheng Mai, 2004. "The Effects of Pollution Taxes on Urban Areas with an Endogenous Plant Location," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 29(1), pages 57-65, September.
    8. Chiou-Nan Yeh & Sontachai Suwanakul & Chao-Cheng Mai, 1996. "The Effects of Business Taxes On Output and Location of the Firm Under Uncertainty," Public Finance Review, , vol. 24(1), pages 99-119, January.
    9. Ottaviano, Gianmarco I.P. & Minerva, G. Alfredo, 2007. "Thirty-five years of R(S)UE: A retrospective," Regional Science and Urban Economics, Elsevier, vol. 37(4), pages 434-449, July.
    10. Ming Chen & Yeung-Nan Shieh, 2011. "Specific commodity taxes, output and location decision under free entry oligopoly," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 47(1), pages 25-36, August.
    11. Zvi Drezner & Carlton Scott, 2010. "Optimizing the Location of a Production Firm," Networks and Spatial Economics, Springer, vol. 10(3), pages 411-425, September.
    12. M Birkin & A G Wilson, 1986. "Industrial Location Models 1: A Review and an Integrating Framework," Environment and Planning A, , vol. 18(2), pages 175-205, February.
    13. Dai, Feng & Li, Pengpeng & Liang, Ling, 2016. "Long-term economic growth under environmental pressure: An optimal path," The Quarterly Review of Economics and Finance, Elsevier, vol. 59(C), pages 15-24.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:envira:v:22:y:1990:i:11:p:1487-1496. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.