The Moses-Predöhl pull and the neoclassical location theory : An alternative approach

This paper shows that the appearance of the controversial Moses-Prednhl pull is due to the two-stage approach (the separation of the production decision and the location decision) which has been applied in the neoclassical location theory. It also shows the Moses-Prednhl pull is zero by using the well-known envelope theorem in the two-stage approach. Furthermore, it provides an alternative approach to show the Moses-Prednhl pull is zero by considering the production decison and the location decision simultaneously.