GEOG 325: LECTURE 8

Central Place Theory

Introduction
The two main approaches to Central Place theory were developed by German
economic geographers- Walter Christaller and August Losch.
Walter Christaller as a 40- year old PHD student developed his central place theory.
Christaller (1933) used a general deductive theory to explain the sizes, number and
distribution of towns in the belief that there is some ordering principle governing
the distribution (Berry and Pred, 1961, p. 15).
He started to play with the maps, connecting towns of the same size with straight lines
until his maps were filled with triangles. These triangles appeared to show some
regularity in a hexagonal pattern. He had assumed that the region under study was a flat
plain / isotropic surface (uniform distribution of population and purchasing power,
uniform terrain and resource localization, and equal transport facility in all directions.
Translation from the original German was done by Baskin in 1966.
Definition
The Central Place Theory is a theoretical account of the size and distribution of
settlements within an urban system in which marketing is the predominant
urban function. The theory assumes that both buyers (customers) and sellers
(shop-owners) make utility- maximizing decisions. Johnston et al. 2000
A central place is a settlement whose prime function is the provision of goods and
services to a dispersed population around it. It may vary in size from a village to a
primate city and forms a link in a hierarchy. For example a central place can be Wa,
Kumasi, or Accra providing goods and services to their populations. It is important to
note that the sphere of influence of a central place or urban field or hinterland is
the area that comes under its economic, social and political influence. To
illustrate, the sphere of influence of Accra can be all the communities under the GAMA.
Urban centres perform dominant functions in addition (e.g. some serve as major markets,
commercial, educational, recreational centres). These centralised functions occur at
relatively few locations in a region- the focal points of that region.
Cardinal Concepts of Range and Threshold
Central place theory revolves around two cardinal concepts of range and threshold. It is
important to note that the range and threshold determine the nature of the central place.
Range
The range of a good (the maximum distance a consumer will travel to purchase
that good alone). It is dependent on the value of the good, the distance, and the
frequency that the service is needed. In other words, Range is the maximum distance people are
prepared to travel to purchase a good or service
Low order functions such as barbers and newspapers need be spaced closely while
high-order goods such as hospital will be spaced widely. This is because people are
likely to travel long distances to access health care (high value service) than to buy a
newspaper (low value service). Also, people are likely to access goods or services that are
closer than the same things far away, especially when the price is the same. This is
because, travelling long distances to access a particular good or service would mean
accessing it at a much higher price. For instance, if the price of a phone is GH50 in both
Accra and Kumasi, travelling from Accra to Kumasi will peg the price of the good at GH
58 (50+ (at) lorry fare of GH8). Furthermore, goods and services that is frequently
demanded need to be closely placed. The range is therefore the farthest distance
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measured in time and cost over which either a customer would be prepared to travel
to obtain it or a supplier is willing to travel to provide it. The concept of range suggests
the range of higher order goods is greater than lower order goods. High order
goods are those with higher values and associated with bigger central places such as
specialised hospital services while low order goods include low value services such as
those of the barber and products like bread and kenkey which are found in all small
settlements.
Threshold
The threshold for a good is the minimum volume of business necessary for an
establishment selling that good alone to be commercially viable. In other words,
Threshold is the minimum number of people needed to support a service.
The threshold of a good or service is the minimum number of people required to support
it and to ensure reasonable profit. The frequency with which a good or service is required
and its cost determines the size of the threshold needed to support one outlet. The more
specialized the service the greater the number of people required to make it viable. For
example banking services and super markets will need a large number of people to
ensure that they get higher returns. The threshold concept also suggests that the
threshold for higher order goods is greater than lower order goods.

Generalization on the Spacing, Size and Functions of Settlement

1. The general rule is that The larger the settlements are in size, the fewer in
number they will be.
Smaller settlements such as hamlets and villages for instance in Ghana are many.
However, larger settlements such as towns and cities are few. In Ghana, the larger
settlements are limited to the few regional capitals. Using the concept of range and
threshold we realise that each big settlement needs several small settlements as its
sphere of influence to which it supplies goods and services. So logically there cannot be
many big settlements because they will not all find the population needed to ensure their
survival.
Similarly, a producer of a good will not allow a competitor located close by unless there is
excess demand.
2. The larger settlements grow in size, the greater the distance between
them.
Larger settlements are farther away from each other and smaller settlements closer to
each other. You can attest that in Ghana, larger settlements such as Accra, Kumasi,
Tamale, etc. are farther away from each other. On the other hand, smaller towns such as
Konongo-Odumase, are much closer to each other.
3. As a settlement increases in size, the range and number of its functions
will increase
A settlement grows in size when there is an increase in its population. As the population
increases then comes the demand for better living standards as in housing, education,
health etc. This increased population also provides opportunities for other economic
activities. All these will result in the settlement increasing the provision of its goods and
services. Larger settlements have a complex economy than small ones because they have
the market to sell to.
4. As a settlement increases in size, the number of higher-order services will
also increase.
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The population of larger settlements such as towns and cities have more purchasing
power than those in smaller settlements like villages. These populations therefore
provide adequate threshold for high-order services such as Bank services and
Supermarkets, etc. Higher-order services will therefore proliferate in larger settlements
than in smaller settlements.
Assumptions of the Theory
The basic elements were developed under assumption of an isotropic surface
uniform distribution of population and purchasing power, uniform terrain and resource
localization, and equal transport facility in all directions. Transport cost is therefore
proportional to the distance from the central place using the only means of
transport i.e. the donkey cart
Higher order central places are more widely spaced than lower order places, and
lower order central places , to be provided with higher order goods and services, are
contained or nest within the trade areas of higher order places according to a
definite rule.

Goods and services are obtained from the nearest central place
only

All customers had the same purchasing power and made similar
demands

Some central places offered only low-order goods with small sphere
of influence while others offered higher-order goods with larger
spheres of influence

No excess profit would be made by any one central place, as each

locates as far as possible from a rival to maximize profits.

There is free market competition in that both supplier and

customer would make decisions entirely on economic grounds.
The Central Place Hierarchy
It is important to note that within any region the hierarchy of central places can be
established by classifying each central place according to the highest order good or
service it supplies. At the apex of the hierarchy there will be the largest central place in a
region with its catchments area large enough to support more than one outlet for all the
orders of goods and services. Below this leading central place, the hierarchy
progressively descends to the lowest order. This will lead to the creation of hexagons,
which are by far, the most efficient geometrical figures for the exhaustion of a
territory without overlap. Central places with the lowest order functions (having
the smallest thresholds and ranges) have the densest network while those in the
next order have a less dense hexagonal network, and so forth. All central places
of a particular order also contain all of the characteristic functions of the lower
order centres.
To illustrate this, if the first order central places are characterized by grocers'
shops, second order places by butchers' shops, and third order places by
hardware stores, then every third order central place will contain grocers' and
butchers' shops as well as one or more hardware stores. This produces a
hierarchy of central places - with seven levels according to the original theory.
To derive the geography of the location of the different orders, he argued that shopowners locate their establishments as close to customers as possible, to minimize
travelling costs and so maximize both shop turnover and consumer satisfaction: shops are
located centrally within their hinterlands.

Organizational arrangements of hierarchical spatial structure

Christaller suggested three ways in which that hierarchical spatial structure could be
organized.
K=3 or Marketing Principle
The k=3 or Marketing Principle minimizes the number of settlements
serving an area by having each at the meeting point of three hexagons.
Since the settlements are located at the meeting points of three hexagons, this
means that each settlement (central place) provides goods and services to three
hinterlands. The shoppers in smaller settlements divide into three equal groups when
shopping in the three nearest larger settlements.

Figure 1 K3 PRINCIPLE
This is mostly employed in marketing to ensure that every area including remote
areas are served. In this hierarchy, competition is also reduced to ensure
reasonable returns. To derive k=3 is very simple. Each of the lower order central
places is serving one-third of the population of the three higher order central
places. Since a hexagon has six sides, it means that 1/3 each of the population of
a particular higher order central place is served by the 6 lower order central
places in addition to its own whole population (1). Mathematically; 1/3 x 6 +1=3.
Hence k=3.
K=4 or Transport Principle
In Christaller's k=4 (or transport principle) model, the goal is to minimize the
length of roads needed to join all adjacent pairs of central places.
Shoppers in smaller settlements divide into two equal groups when shopping in the two
nearest larger settlements.
Each settlement is centrally located on each side of a hexagon, at the boundary
of two rather than three hinterlands. This means that each settlement serves
two hinterlands. The number of settlements is thus greater than in the k=3
model.

Also, to derive k=4 is very simple. Each of

the lower order central places is serving
half of the population of the two higher
order central places. Since a hexagon has
six sides, it means that 1/2 each of the
population of a particular higher order
central place is served by the 6 lower order
central places in addition to its own whole
population (1). Mathematically; 1/2 x 6
+1=4 Hence k=4.
Figure 2. K4 PRINCIPLE
K=7 or Administrative Principle
Finally, Christaller suggested a k=7 (or
administrative principle) model in which
each lower order hinterland nested
exclusively within that of a single
higher-order central place only.
All
shoppers in the smaller settlements shop in
the nearest large settlement.
Figure 3. K7 PRINCIPLE
The largest settlement, which is in the centre
of the hexagon, will be surrounded by a
number of smaller settlements. People from
the small settlements will visit the large
settlement for a particular good or service
that their village does not provide. People cannot cross the boundary hexagons because
Cristaller says they must shop in their nearest central place. Again, k=7 can easily be
derived. This time round, since the lower order central places are located within
the higher order central place, It means that each of the 6 lower order central
places are providing goods and services to the whole hinterland (1) in addition
to its own whole population (1). Mathematically 6 x 1 + 1=7, hence k=7.

Limitations of the Central Place Theory

1. Change in Demand Pattern for Goods and Services
Demand pattern for goods and services have altered because of affluence. There are
changes in taste and preferences and greater mobility enabling people to travel further
to do their shopping and obtain other services. So goods and services are not necessarily
obtained from the nearest central place only. For example, a consumer can travel from
Kumasi to Accra just to purchase a particular good based on a number of factors.
Besides, demand for goods and services can go across national borders. You can for
instance talk about Burkina Fasos Tomatoes in Ghana, Kenyas cauliflower in Europe etc.
Also services such as health care and banking can be sought in faraway places. Kwadwo
Baah Wiredu health visit to S.A.
& Courage Quarshigas health trip to Israel.
2. Technological Innovation
Technological progress has also brought changes in the ways goods and services are
provided in terms of organisation and located. Now with improvement in transport
system and storage facilities such as refrigeration, goods can be transported to very far
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places. There is also improvement in marketing, especially, the purchasing of goods and
services through the internet (e.g. E-bay web site). Through cheap travel, high profile
musicians travel round to perform rather than fans travelling to the city where they are
located or fans being limited to only their local musicians.
3. Government Intervention
Increased government intervention through planning measures and other legislation has
also interfered in the operation of the market forces which help to shape the central
place system. Some areas can be designated residential, industrial, commercial etc. and
these in effect influence the location of central places.
4. Uneven Distribution of Resources
It is important to note that resources are not evenly distributed. Some areas are well
endowed with resources while others are not. The number, location, and spatial
organisation of urban centres are also influenced by the degree or localisation or
dispersal of the resources of which the urban centres directly or indirectly rely.
5. Rigidity
One of the commonest criticisms is that it is far too rigid and abstract.
Positive Sides
6. Excellent Analytical tool
I want to however emphasize that despite these recent changes, the concept does have
some value as an analytical tool. It can still help identify more clearly the role of
settlements as places of trade and exchange and the extent to which this has influenced
the nature of the settlement pattern developing in a region. It encourages us to think of
individual settlements in their wider context and to seek above all some order in the
spacing and interrelatedness of settlements.
Indeed, after the Second World War central place theory had its first real application in
planning of newly reclaimed Nord Oost Polder in the Netherlands. The
`marketing principle` was used in this work. The `administrative principle` was
employed under the Nazis in the `resolution` of the `Eastern Question`:
Christaller was an expert adviser in the `Reich Commissariat for the
Strengthening of Germany`(Freeman, 1987).
7. Excellent Theoretical tool
Criticism of the hexagonal system as being over theoretical may have been too
hasty (Haggett, 1965, p. 51). There is no doubt that the model has had a profound
impact on geographical research in the last decade and Bunge (1962) at least views it as
crucial for the existence of a theoretical geography.