Sraffa Goes to Space: Spatial Elements of Political Economy

The Sraffian tradition has mostly overlooked the role of space, treating it as a static and abstract concept. This work introduces a fresh perspective, with a reappraisal of its significance in economic modeling and the examination of the locational distribution of economic agents. Our research bridges the gap in economic theories between the Surplus approach and the Critical Quantitative Geography literature. This study has multiple objectives. First, the reappraisal of the linkages between these two theories occurred from the publication of Sraffa's seminal contribution. Second, novel concepts such as space capacity, the physical location of workers, and its simple graphical representation are introduced. Third, a demand-side closure of the model in line with the Sraffian Supermultiplier tradition. In conclusion, our research introduces a novel possibility to incorporate space into economic analysis, shedding light on how the spatial distribution of economic agents affects prices, distribution, and growth. Space as much as institutions, should play a central role in economic analysis. The direction taken in this work promises to facilitate the exchange of ideas between Critical Geography and the Surplus Approach literature, offering valuable insights for policy-making and a better understanding of regional economic dynamics.