Retrieving "Differential Theory Of Rent" from the archives

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1. Classical Theory

   Linked via "Differential Theory of Rent"

   Land Rent and Diminishing Returns
   Land), being fixed in supply and possessing inherent differences in fertility, was the subject of the Differential Theory of Rent. Ricardo argued that rent arises not from the intrinsic goodness of the land), but from the differential productivity between the highest-cost land) being cultivated (the extensive margin) and less costly, more fertile lands. [Rent](/entries/econom…