Back to the Future: Lösch, Isard, and the Role of Money and Credit in the Space-Economy
Regional Research Frontiers: The Next Fifty Years, edited by R. Jackson and P. Schaeffer, Advances in Spatial Science: Springer International, Forthcoming
26 Pages Posted: 9 Jun 2016 Last revised: 13 Nov 2016
Date Written: August 6, 2016
Abstract
The recent financial crisis has been a powerful reminder that the intersectoral flow of funds is also -- always and everywhere -- a local phenomenon with real effects. Yet, the contemporary canon of regional economic theory has enshrined the classical dichotomy, treating the spheres of money and production as analytically distinct. Consequently, the current literature has little to say about monetary phenomena and their spatial consequences. The widespread disengagement of regional scientists with respect to issues of money, credit and banking represents a radical break with the discipline's intellectual origins over half a century ago. This paper re-examines the monetary content of some of the foundational works in regional science. In particular, I argue that August Lösch and Walter Isard, the former a student of Joseph Schumpeter's and the latter a student of Alvin Hansen's, both represent important branches in the long lineage of 20th century continental and U.S. monetary thought, respectively. In doing so, this paper also outlines key elements of a research agenda that reengages with regional aspects of money and credit, casting them as central pillars of a Lösch-Isard synthesis.
Keywords: Monetary thought, non-neutrality of money, geography of money and finance, regional science
JEL Classification: B20, E12, R30
Suggested Citation: Suggested Citation