5.8 The Von Thunen Model

Von Thunen Model

The Von Thunen model is an economic model developed in the 19th century that aims to explain the spatial organization of agriculture and how it is influenced by transportation costs. The model was developed by Johann Heinrich von Thunen, a German economist and landowner.

According to the Von Thunen model, the spatial organization of agriculture is influenced by the distance of the farm from the market and the cost of transportation. Farms located closer to the market will be more profitable because they can sell their products at a higher price and have lower transportation costs. As a result, these farms will be more likely to produce high-value crops or livestock that are more profitable to sell.

On the other hand, farms located farther from the market will be less profitable because they have higher transportation costs and must sell their products at a lower price to compete with farms located closer to the market. These farms will be more likely to produce low-value crops or livestock that are less sensitive to price changes.

The Von Thunen model can be used to predict the spatial distribution of different types of agriculture and the relative profitability of different farming activities. It is a simplified model and does not take into account many real-world factors that can influence the spatial organization of agriculture, such as natural resources and infrastructure. 

However, it remains an important conceptual model in economics and is often used to study the spatial organization of agriculture and other economic activities.

It predicts: 

• More intensive rural land-uses closer to the marketplace
  • Example: Commercial farming of milk (dairying)
    • Farms locate closer to urban areas to minimize distance and lower transportation costs (otherwise, the milk will spoil)
    • They don’t need as much space, so they can afford the higher price of land in regions closer to the market
• More extensive rural land-uses further from the marketplace
  • Example: Ranching
    • Livestock need plenty of land to graze, so farmers occupied land further out, where there was a lot of it at a relatively low price.
    • When the von Thunen Model was developed, the livestock were not killed until they reached the city market (so refrigeration/keeping the meat fresh wasn’t an issue)
• *These rural land-use zones are represented by concentric rings in the model

Examples

Here are a few examples of how the Von Thunen model can be used to understand the spatial organization of agriculture:

1. A farmer who grows high-value crops, such as vegetables or fruit, may choose to locate their farm closer to the market in order to take advantage of the higher prices and lower transportation costs.
2. A farmer who raises livestock, such as cows or pigs, may choose to locate their farm farther from the market because the cost of transportation is a smaller proportion of the total cost of production. These farms may be more likely to produce lower-value products, such as feed grains, for the local market.
3. A farmer who grows crops that are not perishable and can be stored for long periods of time, such as grains or oilseeds, may choose to locate their farm farther from the market in order to take advantage of lower land and labor costs. These crops can be transported over longer distances without spoiling, so the cost of transportation is less of a factor in their profitability.
4. A farmer who grows crops that are perishable and must be sold soon after harvest, such as fresh vegetables or flowers, may choose to locate their farm closer to the market in order to reduce transportation costs and ensure that their products reach the market in good condition.

The Four Zones

There are four zones or concentric rings represented in the von Thunen Model, with the solid center core (not included as a ring) being the central city. 

• Zone 1: Intensive agriculture and dairying
  • Fresh milk, dairy products, certain fruits and vegetables
  • These products spoil quickly and are high in demand, so they needed to be closest to the marketplace
  • This farmland was high in demand (because of its accessibility) and very expensive as a result
• Zone 2: Forest
  • Firewood and fuel production
  • Carrying heavy loads would be difficult if it was located far from the central city
  • When the von Thunen Model was created, forest material was high in demand for building and fuel (so it needed to get to the market quickly!)
• Zone 3: Extensive field crops
  • This includes grains for bread (which require larger chunks of land for growing/harvesting)
  • Grains last for long periods of time, are lightweight, and can be stored easily
  • Situated further from the center because
    • last longer than dairy products
    •  cheaper to transport than forest resources
• Zone 4: Ranching
  • Cheap pasture range is abundant further from the center
  • Once livestock were raised, they were driven “on the hoof” to the city market (reducing the cost of transporting them such a long distance)

Summary of Zones

In the Von Thunen model, agricultural land is divided into four zones based on the distance from the market and the cost of transportation. These zones are:

1. The first (inner) zone: This is the most profitable zone because it is closest to the market and has the lowest transportation costs. Farms in this zone are likely to produce high-value crops or livestock that are sensitive to price changes, such as vegetables or fruit.
2. The second (outer) zone: This zone is less profitable than the first zone because it is farther from the market and has higher transportation costs. Farms in this zone may produce lower-value crops or livestock that are less sensitive to price changes, such as feed grains or dairy products.
3. The third (outer) zone: This zone is even less profitable than the second zone because it is even farther from the market and has even higher transportation costs. Farms in this zone may produce crops or livestock that are not as sensitive to price changes, such as livestock feed or lumber.
4. The fourth (outer) zone: This is the least profitable zone because it is farthest from the market and has the highest transportation costs. Farms in this zone may produce crops or livestock that are not very sensitive to price changes, such as timber or timber products. It's important to note that the Von Thunen model is a simplified model and does not take into account many real-world factors that can influence the spatial organization of agriculture, such as natural resources and infrastructure. However, it remains an important conceptual model in economics and is often used to study the spatial organization of agriculture and other economic activities.

Assumptions

• The Von Thunen model is based on a number of assumptions, including:1. The cost of transportation is a linear function of distance: This means that the cost of transporting goods increases proportionally with distance.1. The market is located in the center of a circular agricultural region: This means that all farms are the same distance from the market.1. There is no transportation between different zones: This means that goods can only be transported between the farm and the market and not between farms in different zones.1. There are no externalities: This means that the production and transportation of goods has no impact on the environment or on other economic activities.1. Land is used solely for agricultural production: This means that there are no other land uses, such as urban development or recreation, that could affect the spatial organization of agriculture.1. There is a single dominant agricultural activity: This means that all farms in the region produce the same type of crop or raise the same type of livestock.These assumptions are simplifications of the real world and are not always accurate. However, the Von Thunen model remains a useful tool for understanding the spatial organization of agriculture and other economic activities. 🎥 Watch AP HUG - Spatial Organization

In Short 

• Transportation costs determined agricultural activities and the spatial arrangement of them
• The Model = the center city and four concentric zones (the inner two are intensive, the outer two are extensive)
  • Center City (solid core)
  • Dairying and Intensive Agriculture
  • Forest
  • Extensive Field Crops
  • Ranching
• Main assumptions for this model
  • Flat land
  • One centrally located city
  • There are no disturbances to the economy

Important Part of Von Thunen Model

Here are some key points about the Von Thunen model:

• The Von Thunen model is an economic model developed in the 19th century that aims to explain the spatial organization of agriculture and how it is influenced by transportation costs.
• According to the Von Thunen model, the spatial organization of agriculture is influenced by the distance of the farm from the market and the cost of transportation.
• The Von Thunen model divides agricultural land into four zones based on distance from the market and the cost of transportation. The first (inner) zone is the most profitable because it is closest to the market and has the lowest transportation costs. The fourth (outer) zone is the least profitable because it is farthest from the market and has the highest transportation costs.
• The Von Thunen model is based on a number of assumptions, including that the cost of transportation is a linear function of distance, the market is located in the center of a circular agricultural region, there is no transportation between different zones, there are no externalities, land is used solely for agricultural production, and there is a single dominant agricultural activity.
• The Von Thunen model is a simplified model and does not take into account many real-world factors that can influence the spatial organization of agriculture. However, it remains an important conceptual model in economics and is often used to study the spatial organization of agriculture and other economic activities.