Thunen’s Legacy in Economics
According to Blaug (1968: 321), Thunen was “the first truly modern economist” and, as another commentator emphasized:
The depth and the real significance of his theoretical developments - in particular the unity of his thinking, the interrelationships between the various parts of his analyses, the greatness of the basic structure of the whole opus - have yet to be given the full credit they deserve in the history of scientific ideas.
(Bδventer 1984: 138)One reason for the unsatisfactory reception was that Thunen’s successors did not fully understand the treasures hidden in his works - which can be inferred from the disappointing posthumous edition of the second section of Part II in 1863 and 1875 by his student Hermann Schumacher and by many superficial comments of his contemporaries. According to Blaug this may partially be the responsibility of the author himself as The Isolated State stands out as “a collection of notes, comments, arithmetical examples and mathematical formula in which the main lines of argument can frequently only be discerned with the benefit of hindsight” (Blaug 1992: xi). Another main reason was that only a few scholars were aware of the huge amount of unpublished manuscripts and the important contributions published in the Neue Annalen.
However, among Thunen’s admirers were major economists such as Alfred Marshall, Joseph Schumpeter and Paul A. Samuelson. They credited him with path-breaking achievements in economic analysis, mathematical economics and econometrics and ranked his work even above the work of his famous contemporary David Ricardo. Karl Marx regarded Thunen as far superior to the German economists of his time, and not belonging to the “vulgar” brand.
Alfred Marshall read The Isolated State around 1869 and, according to Peter Hall (1966: xi), central issues of his work derive from Thunen.
They have become part of the toolbox of English economic thought: the treatment of marginal productivity, the analysis of rent, the careful distinction between partial and general equilibrium, the separation of the short and the long term. Through Marshall, Thunen’s Isolated State became a precursor of neoclassical theory.Thunen’s monocentric space model provided the basis from which the German dominated location theory was erected, mainly by Alfred Weber, Oskar Englander, Andreas Predohl, Walter Christaller and August Losch. In his posthumously published papers, Thunen provided a systematic account of factors explaining economic agglomeration, which, according to Fujita (2012), made him a precursor of the New Economic Geography.
Thunen’s achievements in human and in real capital theory, in resource economics and in monetary theory could not exert any influence up until now as they have been unknown until a short while ago. They add to the impressive performance of this genius economist.
Ludwig Nellinger
See also:
Economic geography (III); German and Austrian schools (II); Paul Robin Krugman (I); Formalization and mathematical modelling (III); David Ricardo (I); Adam Smith (I).