The 3 main factors in the least cost theory are: agglomeration economies, cost of labor and cost of   .

The third main factor in the least cost theory, alongside agglomeration economies and cost of labor, is the cost of transportation.

In the context of industrial location, the least cost theory, proposed by Alfred Weber, emphasizes the importance of minimizing costs associated with production and distribution. Here’s a brief explanation of the three factors:

1. Agglomeration Economies: This refers to the benefits that businesses accrue by being close to each other. These may include reduced transportation costs, improved access to shared services and suppliers, and a larger pool of labor.

2. Cost of Labor: This is the expense associated with hiring workers, which can significantly impact the overall cost of production. Businesses often consider locations where labor costs are lower to maintain competitiveness.

3. Cost of Transportation: The expenses related to moving raw materials to the manufacturing sites and finished goods to consumers are crucial in determining the optimal location for production facilities. Minimizing transportation costs is essential for maximizing profits and efficiency.

These three factors work together to guide firms in their decisions on where to locate their production facilities.