Abstract
Most of the underlying theories of facility location and land use models are basically economic concepts, and many of their input/output variables are economic measures. To understand these relationships better, a general knowledge of economic concepts and methodology is helpful. We recognize that theories have been offered by economists to explain the growth and distribution of industrial activities in an area. It is insightful to summarize their experiences—particularly the theories used in regional and interregional economics. This includes such concepts as economic-base theory (or export service theory) of gravitational interaction and theory of interregional flow. Through such a review, one sharpens the focus on the validity and limitations of these analysis methodologies.
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