John Cassidy's New Yorker piece re Jeffrey Sachs and and his new book ("Always With Us?" in the April 11 issue, re The End of Poverty: Economic Possibilities for Our Time) includes this quote from Sachs: "In all my training, the ideas of physical geography and the spatial distribution of economic activity had not even been mentioned." Sachs managed to overcome the deficiency.
Yet, the quote will cause many readers to smile. Space means transactions costs and these were not discovered until Coase (1937) and are just now being taken seriously by significant numbers of economists (see, for example, Institutions and Economic Theory: The Contribution of the New Institutional Economics by Eirik Furubotn and Rudolf Richter).
Textbooks (and undergrads) will have to wait a bit longer. Alchian-Allen-Heyne-Boettke-Prytchitko provide the notable exceptions.