From the location quotient to the transactional self-sufficiency - a method for the study and planning of service industries

Abstract

In studying the location of industries within a country, it is common to employ the 'location quotient' method. In the case of retail and commercial services a rough pattern of transactions may be obtained using this method, without resorting to survey techniques. This may be accomplished by an application of the central hierarchy theory combined with factual knowledge of local transaction habits. The method can be applied even to very small areal units. The index obtained may be more accurately described by the term 'transactional self‑sufficiency' than by 'location quotient'. The principles for determining this index are introduced, and the results of its application as a tool in town and regional planning are presented and discussed.