ABSTRACT
Industrial estates have been developed in Thailand, as elsewhere, to confine factories or industries to a given area. This method of clustering factories together so that they operate within a given boundary benefits society in many ways. Firstly, an industrial estate can act as a zoning device for the city so that factories will not create negative externalities on other activities and land uses, such as commercial centres or residential areas. Secondly, as output from one factory may be used as input for another, locating these factories in close proximity to one another will help reduce transportation costs and other kinds of transaction costs. And thirdly, as most of these factories tend to produce by-products such as wastewater, developing a central wastewater treatment system to serve all the factories in the same locality tends to produce an economy of scale and thus helps reduce the costs of pollution control.
