Multi‐purpose trips and central place theory

Abstract

Summary Central place models assume that consumers only purchase one good of a given order during a single shopping trip. This assumption is relaxed in this paper to allow the purchase of several orders of goods on any given trip. The implications of this for Central Place Theory are then analysed. With relatively simple analytic tools and numerical examples it is demonstrated that the impacts are considerable. Consumer spatial behaviour becomes more complex and realistic and producers are provided with a clear economic rationale for agglomerating with other producers, of both the same and other orders of commodities. Such agglomeration allows a more natural explanation of the formation of central places, more realistic forms of central places, as well as creating spatial variations in the price of a given commodity. With spatial price variations, the regular hexagonal market areas may be relaxed to assume more realistic and irregular shapes.