Lösch, August (1906–1945)

The economist August Lösch was a major contributor to the formation of the body of knowledge combining geography and economics. With the geographer Walter Christaller, he made important contributions to the intellectual thread of location theory extending back to J. H. von Thünen and carrying forward to the formation of the multidisciplinary field of regional science.

Lösch's childhood years were spent in Heidenheim, Württemberg, Germany. He studied economics in Freiburg, Baden-Württemberg, Germany, with Walter Eucken (1891–1950) and later studied economics under the mentorship of Joseph Schumpeter (1883–1950) at Harvard University. Among Schumpeter's students were the economists James Tobin, Robert Heilbroner, Shigeto Tsuru, Nicholas Georgescu-Roegen, Abram Bergson, Paul Samuelson, and Robert Solow; the latter two received the Nobel Prize in Economics.

Schumpeter was important in August Lösch's intellectual development. Schumpeter wrote on the interdependence between demographic change, trade, economic development, and cycles of economic growth and on the importance of entrepreneurship in creating technical and financial innovations. Lösch's research dealt with the geospatial patterns of population, trade, and economic development. His most well-known contribution was The Spatial Organization of the Economy (1940). He acknowledged the importance of the prior work of Christaller (1893–1969). Lösch generalized Christaller's work and explained it with formal economic logic. The contributions of both geographers stand in mutual support of each other.

Lösch developed his hypotheses in the logical positivistic style of the location analysis school pioneered by Johann Heinrich von Thünen (1783–1850). Lösch's conjecture was that spatial patterns of settlement can be described, and their interaction and location explained and predicted, based on their productive activities and their trade. He concluded, as had Christaller earlier, that in a spatial equilibrium, there would be a hierarchy of places. Higher-order places would produce goods and services that required greater numbers of people distributed over larger trade areas for their support. Lower-order places offer goods and services that require fewer people to be sustained. Lower-order places, with their smaller trade areas, are embedded among fewer higher-order places and their larger trade areas. Christaller's system of central places begins at the highest order, while Lösch's system begins at the lowest order.

Trade areas would arise in the shape of hexagons if the landscape were isotropic. Hexagons are the most compact of packable shapes. Christaller had shown that nodes of development are expected to arise on the apices, arcs, or interior of the trade area boundaries, depending on the initial assumptions of the model and characteristics of the landscape. Lösch demonstrated that the locations of Christaller's nodes were special cases of a more general geometry. Lösch's generalization predicted that surrounding a centrally located place, wedge-shaped zones of intensive higher development would arise, alternating with zones of comparatively sparse development. Because all places were geospatially connected, trade and people would naturally flow between the zones, but with the development advantage going to the zone that was “place rich.”