Proposed by the German geographer Walter Christaller in the early 1930s, Central Place Theory attempts to explain the spatial distribution and size of human settlements in the landscape. Christaller based his theory on the spatial pattern of cities in southern Germany, which were fairly regularly distributed across a mostly agrarian landscape at the time.
Christaller suggested that there exists within any sizable territory a fairly predictable hierarchy of urban settlements, with very few large cities, more medium-sized towns, and many smaller hamlets. Large cities could meet the needs of a large market area, drawing people from great distances who come to the city to sell and/or purchase goods and/or services. Large cities have the most specialized markets and services, while towns have a more narrow range of products, and hamlets have even fewer. For example, in a large city you might expect to find exclusive jewelry stores, advanced medical services, and a wide variety ethnic dining establishments. In a small hamlet, however, there may only be a handful of amenities such as a general store, gas station, and diner.
While the range or market territory around cities is technically a circle radiating out in all directions, the central place theory model is composed of hexagons so that no market territories overlap. In reality, however, market territories do often overlap and people choose to travel to one central place or another for a wide variety of reasons. A variety of service areas can also overlap, such as radio stations or newspapers canvassing multiple cities within a region.
People are generally willing to travel longer distances to reach large cities because they contain more of these highly specialized goods and services that cannot be found elsewhere. The maximum distances people are willing to travel to reach a give city is its range. Christaller noted that larger cities tended to have larger ranges overall, though any given activity within the city could be said to have its own range. For example, people might be willing to travel 50 km to visit a large retail outlet, but considerably more — maybe 200 km — to receive advanced medical care.
The larger a city’s population, the more specialized the goods and services are likely to be. This is because certain goods and services have very low demand among the general population, and thus require a large population to sustain that good or service. Millineries (hat stores/makers) are quite uncommon these days because few people wear hats (other than ball caps) on a regular basis. However, you can find these specialty hat stores in several large U.S. cities because there’s enough customers within their market territories to support the business. The minimum number of people to support a particular good or service is known as threshold. While threshold is generally associated with population, it can also be defined in terms of income, since wealthier populations can often support more specialized goods/services.
Christaller’s model predicted that within a primarily agricultural landscape without major topographical and other geographical variations (such as rivers, lakes, or mountains), you would expect to find a settlement every 5-10 kilometers. This is because a person could travel roughly this distance and back within a single day, allowing them to sell their goods at market and/or purchase goods and return home. In landscapes with little variation this model holds up fairly well. However, most landscapes have considerable geographic variation, and cities and towns are often situated in a less than regular pattern to take advantage of these variations. Rivers, for example, tend to draw human settlements because they offer benefits such as transportation and water for consumption and other purposes. Although the model predicts that larger cities tend to be separated by larger distances, access to the coast and other geographic amenities often results in clusters of large settlements, as seen in the Northeast U.S.
Despite its limitations, the central place theory is still useful at the landscape level to serve as a base model against which variations can be compared and analyzed. In any given landscape you can ask: why don’t cities follow the pattern predicted by central place theory? The concept therefore serves as a good starting point for analyzing the inter-urban pattern of human settlements.
At a finer scale, central place theory may also be applied to city districts and neighborhoods. Every retail development, for instance, has a particular market territory, with larger and more specialized retail stores often having a larger range and threshold. Even though the spatial distribution of economic activities within cities is most often far from regular, the concepts of range and threshold still apply and can be quite useful in analyzing these features.