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of urban areas for the location of industry
and services stems from scale economies in
production (efficient plant sizes are large),
lower transport costs (reduced by clustering
activities together), the modest use of land by
industry and services as an input to production
(allowing high densities), externalities
among firms (sharing of information),
linkages across firms (providing intermediate
inputs to each other) and potential agglomeration
economies (because large clusters of
activities use specialised inputs more