Discuss the differences between the Marshall’s Theory of rent and Modern theory of rent.

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Marshall’s Theory of Rent and the Modern Theory of Rent present distinct perspectives on how rent is determined and allocated within an economy. Here’s a comprehensive comparison of the two:

### Marshall’s Theory of Rent

Alfred Marshall's Theory of Rent, introduced in the late 19th century, is primarily grounded in the classical economics framework. Marshall's view on rent is embedded in his broader analysis of supply and demand, and it is fundamentally tied to the concept of economic surplus.

1. Concept of Rent: Marshall defined rent as the payment to a factor of production (land) that exceeds its opportunity cost. In essence, rent arises because of the differential productivity of various pieces of land. This differential productivity is due to natural advantages such as soil fertility or location, which make some lands more productive than others.

2. Differential Rent: Marshall emphasized the idea of differential rent. This is the rent earned by land that is more _____ __________ ___________ ____ ________ _____________ _____________ _____________ _____________ ___________.
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Degree : BACHELOR DEGREE PROGRAMMES
Course Name : BACHELOR OF ARTS
Course Code : BAG
Subject Name : Principles of Microeconomics-II
Subject Code : BECC 132
Year : 2024 2025