Agglomeration Economies Law and Legal Definition

Agglomeration economies or external economies are benefits received by a specific property from the surrounding features or facilities. While determining the value of real estate, consideration should be given to the property's surroundings. The location of supporting or like-kind facilities near the property can have a synergistic effect on the property and make it more valuable. An example of external economies is a shopping mall which acts as an efficient collection of retail stores. Stores in the mall see more customers than if they were located away from the mall.