On Relations Between Transport And Market Scale

Economic activities happen in different locations, but the concept of "space" or "location" is totally neglected in the mainstream economics theory, and so is the concept of transport. Only with good transport infrastructure, can economic resources and activities in different locations be linked and entered into the social division of labor, in turn market scale is enlarged and increasing return and economic development can be re realized. If transport development lags behind, high transport costs will be a barrier among different locations, and the social division of labor is confined and the economic development is restrained. Therefore, transport is the basic condition of and essential prerequisite to an economy and its development, and transport is also the influential factor to the market scale in an economy. Market scale extension requires firms allocate resources and distribute products in a larger area, creating transport demand and having effect on transport development.Transport infrastructure construction is basically the market construction, and it provides a platform of achieving specialized division of labor, mass-production and mass-circulation. Without developed transport infrastructure, a modern market economy would not exist. Insufficiency of transport infrastructure is the spatial barrier to a larger market scale and it is also the cause to economic backwardness. Unbalanced regional economic development in China is caused to a large part by unbalanced transport infrastructure construction. The areas with a slow economic development or stagnation in China must be the ones with poor transport infrastructure. Balanced economic development in different regions cannot be attained without transport infrastructure construction in the backwoods.This dissertation firstly sorts out the thoughts of division of labor and market scale, thoughts of transport and economic development, as well as location theory in economic geography, and then the relation between transport development and market scale is illustrated theoretically. In the forth part of the dissertation, the cases of transport development and market scale in America and China are studies respectively. A brief conclusion is made at the end of dissertation.