ABSTRACT
This chapter starts with a review of settlement theories developed mainly by geographers. It discusses the theoretical aspects of identifying optimum scale and then reviews some empirical work as a preliminary to examining regrouping procedures currently applied. The development of a rural settlement pattern takes place over time within a changing economic and social setting and is subject to spatial market forces leading towards efficient location. Farm, rural and small town areas are generally thought to be in the steeply-falling phase of the U-shaped cost curve for most goods and services. Rarely will scale be such that unit costs are minimized and it is unlikely that demand will be large enough for operation in the rising cost phase. Rural districts had diseconomies of scale in the provision of housing, urban councils economies and higher-order settlements diseconomies. Highway economies were mainly found at a county council level.
