A Forgotten Concept in Economic Theory: “Space”

Abstract

In economic theory, space is not a much-anayzed concept. Economic theory assuming that countries and regions are non-dimensional generally, has excluded the space factor from its analyses. However, recently the surge in the interest in spatial analysis is striking. The main objective of this study is to put forward, from the past to the present, the point of view of space through the selected models of the theories analyzing space. In this study, space is basically discussed in terms of three periods and three traditions. Firstly, the Classical Location Theory which prevailed from the 19th century to the World War II is analyzed. Then the Regional Science which emerged after the World War II, and the New Economic Geography Theory which was put forward at the beginning of the 1990s are addressed, respectively. The Location Theory underlies both the Regional Science and the New Economic Geography. Thus, in fact, the analysis of these three traditions also shows to what extent they differ from each other. Moreover this literature assessment, demonstrates whether the New Economic Geography Theory which has become quite popular in recent years is really new, and its differences from the other two theories.