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Benefits of aggregation effect
"Agglomeration effect" refers to the economic effect produced by the spatial concentration of various industries and economic activities, and the centripetal force that attracts economic activities to a certain region. It is the concentration of innovation elements and the amplification of competitiveness. Benefits include cost advantages, and the proximity of enterprises can reduce costs. Promoting division of labor, cooperation and agglomeration can give full play to the comparative advantages among enterprises. Enjoy geographical and brand advantages.

? Polymerization effect? It refers to the economic effects produced by the spatial concentration of various industries and economic activities, and the centripetal force that attracts economic activities to gather in a certain region. It is the concentration of innovation elements and the amplification of competitiveness. Benefits include cost advantages, and the proximity of enterprises can reduce costs. Promoting division of labor, cooperation and agglomeration can give full play to the comparative advantages among enterprises. Enjoy geographical and brand advantages.

The agglomeration effect can bring the following benefits to the enterprises in the agglomeration area:

1. Cost advantages brought by economies of scale and scope. Enterprises are close to each other in a certain area, or at a certain link in the production chain at the same time and have different division of labor, thus reducing costs, such as transportation costs.

2. Promote division of labor and cooperation. The new trade theory holds that the endogenous absolute advantage generated by the interaction between market and division of labor is more universal, and the final result of competition will mainly depend on the efficiency of resource use. Agglomeration in a certain area can better discover the comparative advantages of various enterprises, thus forming vertical and horizontal cooperation, promoting the development of economies of scale and upgrading the industrial structure, thus improving the utilization efficiency of resources.

3. Enjoy geographical and brand advantages. Because a region does a good job in one or some aspects or brands, thus improving the overall popularity and corporate image, commodity demanders will automatically come to this region to buy goods, and at the same time, due to many convenient conditions of regional agglomeration, investors will be attracted to invest. The agglomeration of small and medium-sized enterprises has three obvious characteristics: industrial correlation, and the formation of network organization between adjacent areas and cluster enterprises. The agglomeration effect of agglomeration area depends on the perfection and density of inter-enterprise network.