The purpose of Reilly's law of retail gravitation (1931) is to find
a point of indifference between two locations, so the trading area of
each can be determined. This point is assumed to be a function of the
distance between two locations pondered by their respective size (population
often used for this purpose). A location can thus be more attractive
than the other. For instance, on the above figure two locations are
75 km apart. According to the Hotelling principle, the point of indifference
should be halfway in between (35 km). However, since location A has
a larger population (more weight), it is assumed that it will draw more customers.
Under such circumstances, the point of indifference is 45.9 km away
from location A.