Tyunen Agricultural Standard
German scientist Johann von Thunen was the first to say that the geographical and spatial factor strongly influences economic decisions. It happened in 1826. In the future, this gave the development of a whole direction of economic thought - the regional economy. Thünen’s conclusions and reasoning seem very obvious, but they provide very important answers to the direction in which modern urban agglomerations should be developed.
For quite a long time, economists, when conducting their research, abstracted from the spatial factor. In other words, for most of the early theories it was not important where, from a geographical point of view, production was located, and where the consumer of the product is lived. At the same time, in practice, enterprises of similar industries and a with similar technology type, were grouped in approximately the same places, and obvious patterns were observed in the development of many territories. It was suggested to include the spatial factor in economic research, and the first such attempt was made in 1826 by the German economist Johann Thünen. And although Thünen considered the placement in the space of agricultural activities, his approach can be applied to other areas. Thus, Tyunen managed to lay the foundation for a new science - a regional (spatial) economy.
In his model, Thünen considered the state, representing it in the form of a circle, in the center of which there is a city, and on the edges - rural areas. Residents of the city produce industrial goods and buy agricultural products, villagers, on the contrary, residents of rural areas produce agricultural products and purchase industrial goods. It is assumed that this state has no foreign economic relations, it provides itself with all the necessary goods on its own. In addition, an assumption is made that land productivity is the same anywhere in the state.
The main subject of research in this model is the placement of certain types of agricultural activity around the city. In other words, Thünen tried to explain with his model why some types of agricultural production are grouped directly around the city, while others are quite far from it. Thuenen identified six main tiers of agriculture, each of these tiers is further from the city than the rest.
Schematically, this assumption can be represented using the following graph:
Tyunen Agricultural Standard Model
As you can see, the closest to the city, along Tyunen, is gardening, followed by forestry, dairy farming, extensive grain farming, extensive livestock farming and unused land.
The main task of the model is to try to explain why these industries are located in such a concept.
For this, two concepts are introduced - productivity and transport costs. By productivity we mean the number of units of a product that can be produced per hectare of land. Productivity is determined by the technology of a particular type of agricultural product, it does not depend on the farmer personallity. Obviously, flowers production requires less space than meat production (in the second case, extensive pastures are needed for livestock walking, etc.). To ensure comparability, it is advisable to set the productivity in monetary terms as the amount of revenue that can be earned per unit area. And for each of the sectors of agriculture, this value will be different.
The second parameter is transport costs. They, in turn, positively depend on the range of transportation and the weight of the cargo (agricultural product). In other words, the farther the farmer places his business from the city, the higher his costs. Therefore, it is not surprising that absolutely all farmers want to place their production as close to the city as possible. As a result, the closer the land is to the city, the greater the demand for it is observed, while the supply of such land is limited. The best (from a geographical point of view) plots of land are set at the highest price.
Thus, the Tyunen model fixes a contradiction between the entrepreneur’s desire to get as close to the city as possible and high rents on such plots of land. But, as mentioned above, the profitability per square meter of farmers varies, so those who can offer the highest price win the competition for the best plots of land. Those entrepreneurs who earn a large sum of money from one hectare of land (whose production technology involves great productivity), can propose higher rent payment. They pay higher rents, but higher productivity allows them to cover these costs and still work for profit.
This model is certainly not without flaws. In particular, it proceeds from slightly unrealistic assumptions (about the absence of trade, about the same yield), taking into account only the transport factor when placing production facilities, ignoring the possibility of having several centers of attraction, etc. This model in general seems quite obvious - its main conclusions today will be easily understandable to any person who does not even have a specialized economic education. Nevertheless, the model explicitly simulates the processes that are now taking place in many large Russian cities after the collapse of the USSR.
The more a business earns from a unit area, the closer to the city center it is able to accommodate. Therefore, in the city centers today are mainly office space, banks, expensive retail (boutiques, jewelry stores, etc.). Further, already in the next tier, there are residential areas - moreover, as they move to the outskirts, the number of storeys should decrease, low-rise construction gradually begins. In the next tier of the city agglomeration, there will be small industries - as a rule, oriented to the production of goods to the inhabitants of the agglomeration. And in the very last tier there are large-scale production and agricultural enterprises.
Violation of this sequence is unnatural - it contradicts the basic laws of the economy and leads only to an increase in total costs and a decrease in the competitiveness of agglomerations.
Many Russian cities in the Soviet period were built on completely different principles. Large industries were located in their center, and large sleeping areas - on the contrary, on the outskirts. Many parts of these cities were designed when market laws did not apply and planned economy existed. This is such a painful transition when market laws reappeared, hence the problems with the organization of city and its transport systems.
Therefore, if we discard other factors, any renovation of old production areas and its replacement by office appartment should be welcomed, as well as the fight against large-scale private sector areas in the central city. These processes, for all their complexity, legal and moral, from an economic point of view, improve the urban structure, make it more optimal for building an effective urban economy within the agglomeration.
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