ABSTRACT When a manufacturing firm has a plan to build a factory, the determination of the factory’s location site is one of the most important elements in the plan. Since the manufacturer does not have enough information of economic conditions of all potential location sites, the manufacturer cannot determine immediately its location site. A series of steps are taken to determine the location place. The firm makes range of searching area small step by step toward the site deter-mination; 1) Determination of a prospective region in a large space, 2) Selection of a potential area in that region, 3) Choice of an urban district in that area, 4) Decision of a site in the district. This paper proposes that chaotic phenome-non, which is appeared in the calculation processes to specify the optimal location site, may be used to identify a pro-spective region. And then, it is shown in the paper that the central place systems laid in the region play a role in the se-lection of a potential area for the factory location. This paper elucidates how a firm searches step by step an appropriate factory’s location within a large geographical area.
Cite this paper
T. Ishikawa, "A Role of Chaotic Phenomenon and the Central Place System in a Firm’s Location Selections," Theoretical Economics Letters, Vol. 2 No. 1, 2012, pp. 101-108. doi: 10.4236/tel.2012.21019.
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