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Economic geography is the study of the widely varying economic conditions across the earth. The economics of a geographical area can be influenced by climate, geology, and socio-political factors. Geology can affect resource availability, cost of transportation, and land use decisions. Climate can influence natural resource availability (particularly agriculture and forestry products), and working conditions and productivity. The social and political institutions that are unique to a region also have an impact on economic decisions.

These aspects of economics were noted by Adam Smith in The Wealth of Nations and have also been studied by modern economists like David Landes at Harvard University and the 20th century economist Ellsworth Huntington.

This can be contrasted with spatial economics or locational economics which looks at these questions from a microeconomic perspective. Instead of ascribing locational decisions to geography, it typically uses more abstract variables like distance or travel time. Economic geography has fallen out of favor in recent decades with most economists switching to "spatial economics" methods.

The earth is the stage on which men live and work. The broad limits within which economic life functions, therefore, are set by the natural environment. In any given region there is a variety of economic pursuits in which men may engage successfully, but in the same region there are numerous other pursuits in which success is out of the question. Among the conditions which have a bearing on the economic life of a region none is more fundamental than the natural environment, none changes so little from generation to generation even though succeeding generations make very different uses of it, and none varies more from region to region. It is the purpose of economic geography to investigate for the various regions of the earth the relation between economic life and the natural environment.

Economic geography shares with other branches of knowledge-economics, agriculture, geology, history - the responsibility of studying economic life. The peculiar contribution of economic geography is an understanding of the relation between natural environment and economic life in the various regions of the earth. Formerly men observed regional differences, such as the fact that there were many people in some regions and few in others, or that certain crops were raised in some regions and quite other crops in other regions, and were content to stop with these observations, or with some fantastic explanation. In recent times, however, men have come to search for the causes of these regional differences in economic life. Such knowledge is inherently interesting. It is also essential if wise use is to be made of the natural possibilities of any given area. The more wisely the natural resources of all regions are used the higher can be the material standard of living of all mankind.

For each type, whether it be of climate or of land forms or of some other element of the natural environment, the aim is to determine ( a ) its characteristics, ( b ) its regional distribution, and ( c ) its significance to economic life. It should be remembered that economic geography is concerned with man quite as much as with the natural environment, and that man may make and does make a choice as to how his economic life is ordered. It should not be forgotten, however, that Nature sets the broad limits within which man can live and work successfully. Men frequently make unwise choices in economic pursuits, many of which could be avoided with proper knowledge of economic geography. Much knowledge and many desirable practices have been acquired through the ages, not by conscious choice, but by the costly method of trial and error. The Chinese, for example, who very aptly have been called "Farmers of Forty Centuries," have developed a most effective group of practices by which they use the land. In other phases of economic endeavor, however, notably in the utilization of their mineral resources, the Chinese are extremely backward. Knowledge scientifically acquired and organized and applied, in contrast with knowledge hit upon by trial and error, permits elimination of costly mistakes, and expedites wise adjustment of economic life to the natural environment to which it is so vitally related. The following questions help make clear the scope of economic geography. Appropriate atlas maps should be consulted as the questions are studied.

In its bearing on economic life, climate is second to no other element of the natural environment. Like other environmental elements, climate varies greatly from place to place on the earth's surface; probably no place has precisely the same climate as any other place. There are, however, extensive areas throughout which the climate is essentially the same, and it is possible to divide the earth's surface into climatic regions, and to classify the climates of these regions into a comparatively small number of types. The types of climate which are distinguished in the following exercises differ markedly one from the other in the kind of economic life that is likely to develop within them. These climates differ particularly in the products that characterize them. Careful study of the exercises will establish ( a ) the characteristics, ( b ) the distribution, and ( c ) the economic life typical of some fifteen major types of lowland climate.

Economic activity is not evenly distributed across space. On the contrary, clustering of economic activities can be found at various levels of aggregation: the considerable variation in economic size of cities or regions at the national level, or the uneven distribution of wealth and production at the global level. The question arises, of course, of why location apparently is relevant for the distribution of economic activity. To answer this question, we need an analytical framework in which geography plays a part one way or another.

Economic activity is not evenly distributed across space. On the contrary, clustering of economic activities can be found at various levels of aggregation: the considerable variation in economic size of cities or regions at the national level, or the uneven distribution of wealth and production at the global level. The question arises, of course, of why location apparently is relevant for the distribution of economic activity. To answer this question, we need an analytical framework in which geography plays a part one way or another. . .

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