PRICE UNCERTAINTY,FACTOR SUBSTITUTION,AND THE LOCATIONAL BIAS OF BUSINESS TAXES*

Consideration of the integrated production-location problem is extended to include several types of business taxes. Many of these taxes are technologically and spatially neutral under certainty, but are shown to be nonneutral when factor prices are stochastic and the firm is risk averse, even when the tax is spatially uniform. Consequently, even a nationally uniform tax can have regional biases and can encourage migration of plants. When factor prices are uncertain, the effects of taxes on output rates, input ratios, and plant location vary with the form of the tax imposed as well as the amount to be paid. Income taxes involve the taxing authority in sharing the risk with the firm and are shown to promote risk taking by the firm and induce the expansion of output. Locational incentives which are mutually beneficial to firms and the government are presented.     

STRUCTURAL DIMENSIONS IN THE GEOGRAPHY OF LOCATIONAL CONFLICTS

L ocational c onflict is a frequent by-product of efforts to change the physical structure of man-made environments. Within the geography discipline, theoretical and empirical interests in the conflict basis of public and private decisions on the use of land were stimulated in the early 1970s by the work of Julian Wolpert and his associates.¹ The resolution of conflicts over the locations of specific activities is seen as an important means of allocating benefits among locations² and has led to considerable variations in the distribution of necessary services and amenities among residents of the city.³ Indeed, irrespective of overt evidences of conflict occurrence, David Harvey has characterized the land-use pattern itself as an important indicator of the socio-political rules which direct urban development.⁴     

LOCATIONAL FACTORS OF MACHINE MANUFACTURING IN THE SOVIET NORTH

Arguments are marshaled against the location of machine manufacturing in the North. The location of suppliers and the location of the market are viewed as negligible factors because machinery plants generally are supplied from a large number of sources and serve a highly dispersed market. The crucial element is said to be the issue of labor resources, particularly skilled labor, and the associated infrastructure that would be needed in the North. It is also pointed out that machine manufacturing is traditionally most cost-effective in large urban centers and in older industrial areas where it benefits from the so-called agglomerative effect of locational factors. It is recommended that metal-fabricating activities in the North be restricted to essential equipment repairs and overhauls and occasional manufacture of nonstandard equipment, with greater use of centralized supplies of spare parts. (For an opposed view, see V. P. Yevstigneyev in Soviet Geography, May 1976.)