what is agglomeration economies class 10

Agglomeration economies refer to the benefits that come when firms and people locate near one another together in cities and industrial clusters. These benefits include reduced transportation costs, access to markets, banking, insurance, transport, labor, and other resources. When multiple industries come together to make use of the advantages offered by urban centers, it is known as agglomeration economies. The phenomenon where businesses tend to cluster close to each other and high population areas is also referred to as agglomeration in economics. Components of agglomeration economies include supplier access economies, localization economies, diseconomies of scale, and urbanization economies.