Chapter 1 Advances in regional economics This chapter focuses on the advances made in regional economics. Regional economics analyzes the spatial dispersion and coherence of economic activities. Although it is a fairly recent discipline the history of economics shows various early attempts to explicitly address spatial issuesfor e.g. in comparative costtheories and international trade theories. Initially much of the field of regional economics was based on an analogy to general economics the main difference being the explicit treatment of geographical space as a source of various locationallocation phenomena. Illustrative examples in this context are linear programming models for transportation analysis spatial substitution problems in neoclassical production theories inter regional input output analysis and so forth. In a later stage however more emphasis was placed on the indigenous features of geographical space and its implications for the spatio temporal evolution of complex spatial economic systems. Currently regional economics appears to be a rich discipline with a great many linkages to urban economic problems transportation problems and natural resource problems.