Central Place Theory is an economic theory that explains the size and distribution of human settlements. Developed by Walter Christaller in 1933, it suggests that cities and towns serve as "central places" providing goods and services to surrounding areas. The theory posits that these settlements are organized in a hierarchical manner, with larger cities offering more specialized services than smaller towns. The theory relies on the concept of market areas, which are regions where a central place attracts customers. Each central place has a specific range and threshold for its goods and services, determining how far people will travel to access them. This helps explain the spatial arrangement of urban centers and their influence on regional development.