Abstract
It was suggested in a previous chapter that some of the disillusionment which has recently been felt with growth-pole policy reflects a fundamental misunderstanding of the role which external economies can play in the polarisation process. It has been seen that Myrdal initially stressed the role of external economies ‘interpreted in the widest possible sense’ in the cumulative disequilibrium process, with the concentration of such economies in the areas in which growth historically began reinforcing further concentration.1 Perroux also stressed their importance in his initial exposition of the growth-pole concept,2 yet later demoted them in favour of the concept of ‘growth-promoting’ investment, interpreted in a different sense to include the force of innovation in entirely new processes and products, again concentrated in those areas in which growth had initially taken place.3 But in fact his later treatment does not argue the case against reliance on external economies in polarisation. It simply asserts it. As a consequence, it is perhaps not surprising that so many of his own followers have continued to employ the external economies concept in a growth-pole context, and that this fashion has been extended in the United States in ‘industrial complex’ analysis.a
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References
Cf. Myrdal, Economic Theory and Underdeveloped Regions.
Cf. Perroux, Economique Appliqée, nos 1–2 (1955).
Cf. Francois Perroux, Les Techniques quantitatives de la planification (1965) p. 49.
Tibor Scitovsky, ‘Two Concepts of External Economies’, Journal of Political Economy (April 1954).
J. E. Meade, ‘External Economies and Diseconomies in a Competitive Situation’, Economic Journal, vol. LXII (1952).
Jacob Viner, ‘Cost Curves and Supply Curves’, Zeitschrift für Nazionalökonomié, III (1931).
Scitovsky, Journal of Political Economy (April 1954).
Alfred Marshall, Principles of Economics, 8th edn ( London: Macmillan, 1962 ) p. 221.
Ibid.
Ibid. pp. 225–7. In his introduction Marshall acknowledges a debt to von Thünen, but cannily avoids constructing a general theory of location on perfect competition assumptions such as von Thünen undertook at the cost of losing reality.
Cf. Eugene Schooler, ‘Industrial Complex Analysis’, in Methods of Regional Analysis, ed. Walter Isard (1960) pp. 375–412.
Cf. Jozsef Csillaghy, Intégration économique internationale et differentiation régionale (1966) p. 98.
E. M. Hoover, The Location of Economic Activity ( New York: McGraw-Hill, 1948 ) p. 113.
Marshall, Principles of Economics, p. 226.
Ibid. p. 225.
M. Parodi. Submission to the E.C.E. Study undertaken by Kuklinski, Location of Industrial Plant, p. 5.
Hoover, Location of Economic Activity, p. 36.
Ibid. p. 30.
Marshall, Principles of Economics, p. 225.
Raymond Vernon, ‘International Investment and International Trade in the Product Cycle’, Quarterly Journal of Economics (May 1966) pp. 190, 195.
Cf. Edgar Hoover and Raymond Vernon, Anatomy of a Metropolis ( New York: Doubleday-Anchor, 1962 ) pp. 58–63.
Melvin L. Greenhut, Plant Location in Theory and Practice (University of North Carolina Press, 1956) p. 164.
Philippe Aydalot, ‘Note sur les Economies Externes et quelques notions connexes’, Revue Economique (November 1965) p. 960.
Siro Lombardini, Informazioni SVIMEZ, no. 1 (1968) p. 24.
Hirschman, Strategy of Economic Development, p. 84.
Lombardini, Informazioni SVIMEZ, no. 1, p. 24.
McCrone, Regional Policy in Britain, p. 214. Cf. Also the conclusion of R. Grieve and D. J. Robertson that ‘a population of more than 100,000 is likely to offer the best chance of success’, in ‘The City and the Region’, University of Glasgow Social and Economic Studies, Occasional Paper, no.2 (1964).
G. C. Cameron and B. D. Clark, in an enquiry concerning seventy-nine companies which had located in U.K. development areas between 1958 and 1963, found that ‘some areas are rejected on social criteria and particularly because of the poor physical and social environment which they are said to possess… In particular, companies transferring their plants were often greatly influenced by the views of key staff who were not keen to settle away from the Southern countries.’ Cf. Cameron and Clark, ‘Industrial Movement and the Regional Problem’, University of Glasgow Social and Economic Studies, Occasional Paper, no. 5 (1966) pp. 156–7.
With regard to the Scottish designated growth areas in the 1958–63 period G. C. Cameron and G. L. Reid commented that ‘they are small in size, competition for labour will probably be severe, and if similar companies competed for scarce skills, their labour turnover might be high’. Cameron and Reid, ‘Scottish Economic Planning and the Attraction of Industry’, University of Glasgow Social and Economic Studies, Occasional Paper, no. 6 (1966) pp. 65–6.
Cf. Ackley and Spaventa, in Banco Nazionale del Lavoro Quarterly Review (June 1962).
Cf. Società Autostrade, Primi Effetti Economici dell’Autostrada del Sole (I.R.I., 1965 ).
François Coront-Ducluzeau, La Formation de l’espace économique National (1964) p. 57.
Hoover, Location of Economic Activity, p. 174.
Parodi [in Kuklinski, Location of Industrial Plant]does not envisage the possibility of training of technical personnel in order to countervail polarisation of activity on Paris.
W. F. Luttrell, Factory Location and Industrial Movement (Cambridge University Press, 1962 ) vol. I, p. 42.
Florence, Logic of British and American Industry, pp. 72–3. There is now considerable uniformity of opinion on the relative insignificance of transport costs in location. Cf. Philippe Leurquin, Marché Commun et Localisations (1962) p. 266
Sylvain Wickham, L’Espace industriel européen (1969) p. 114; and The Report on the Scottish Economy, Toothill Report, Scottish Council Development and Industry (1962) p. 85.
Pottier, Revue Economique (January 1963).
Kuklinski, Location of Industrial Plant, p. 47. Kuklinski’s evidence indicates that from 60–80 per cent of industrial investment in the economies he considered is allocated to the expansion of existing plant rather than to the establishment of new ones.
This, of course, is the conclusion reached by Hotelling in his model of location under duopoly. Cf. Harold Hotelling, ‘Stability in Competition’, Economic Journal (1929) pp. 52ff.
Vernon and Hoover allow this point with regard to the distribution of bakery products in the New York region. As they put it, ‘with a location outside the nub [centre], plants avoid the need to start each delivery trip from the place of worst congestion’. Cf. Edgar Hoover and Raymond Vernon, Anatomy of a Metropolis, p. 38.
Benjamin Chinitz and Raymond Vernon, ‘Changing Forces in Industrial Location’, Harvard Business Review (January-February 1960) pp. 130–2.
Cf. also Luttrell, Factory Location and Industrial Movement, vol. I, p. 335. With regard to management efficiency in dispersed locations where plant of the same company were separated, Luttrell concluded that ‘too great a distance from the point of control (or from another factory with an interlocking programme) was a disadvantage, but that this chiefly affected the smaller subsidiary branches’.Overall, he concluded that the difficulties caused directly by the locations that had been chosen were generally marginal, and they were normally outweighed by differences of operating efficiency. (My emphasis.)
Aydalot, Revue Economique (November 1965).
Hoover and Vernon, Anatomy of a Metropolis, pp. 50–1.
Hirschman, Strategy of Economic Development, p. 83.
Hansen, French Regional Planning, pp. 9–10.
Jeanneney has drawn attention to the extent of unpaid-for costs in the location of a new firm — housing for workers, extension of schools, hospitals and transport — in ‘A la recherche des principes pour une politique de développement des économies régionales’, Revue Economique, no. 6 (1956) p. 867.
Luttrell, Factory Location and Industrial Movement. Cameron and Clark found that this factor was the ‘originating pressure’ for a new location for fifty-five of sixty-eight companies replying to this part of their questionnaire, University of Glasgow Social and Economic Studies, Occasional Paper, no.5 (1966) pp. 71–3. Cf. also P. M. Townroe, ‘Locational Choice and the Individual Firm’, Regional Studies (April 1969) p. 19.
Cf. Streeten, Economic Integration.
O T. P. Bergin and W. F. Eagan, in Government Measures for the Promotion of Regional Economic Development (1964) pp. 22ff.
Luttrell, Factory Location and Industrial Movement.
Ibid. vol. 7, pp. 40–8, 340–1. Cf. Table 11, p. 286. Of eighty-five firms studied by Luttrell 41 per cent located in Development Areas, 26 per cent in ‘intermediate regions’ and 33 per cent in ‘prosperous regions’. Seventy-three of the original locations had been in prosperous regions and nineteen in intermediate. Cf. ibid. vol. I, p. 363.
Ibid. vol. I, pp. 340–1.
Ibid. vol. I, pp. 176, 322. Cameron and Clark, University of Glasgow, Occasional Paper, no. 5 (1966), p. 201, also found that ‘some of the largest companies, particularly in the engineering and electrical goods sector, established units up to 400 miles from parent plants’.
Luttrell, ibid. vol. I, p. 343.
Ibid. vol. I, pp. 114–15,169,298–9.
Ibid. vol. I, p. 40.
Ibid. vol. I, pp. 341–2.
Società Autostrade, Primi Effetti Economici dell’Autostrada del Sole (1965).
Ibid. p. 56.
Ibid. pp. 74–6. Cf. Table 12, p. 287.
Ibid. p. 68.
Ibid. p. 80: ‘It would seem possible to conclude that the type of growth promoted by the Autostrada del Sole represents a new solution: a solution which contains the advantages of a wide spatial distribution and a rapid rate of growth.’
Italconsult, Studio per la Creazione di un Polo Industriale di Sviluppo in Italia Meridionale, Rome (1965).
Ibid. pp. 19–22.
Ibid. pp. 12–15 (my emphasis).
Hunter, ‘Planning and the Labour Market’, in Regional and Urban Studies ed. Orr and Cullingworth p. 76.
Walter Isard and Eugene Schooler, ‘Industrial Complex Analysis’, in Methods of Regional Analysis, ed. Isard, pp. 375–6.
Ibid. pp. 375–8.
Ibid. p. 378.
Ibid. pp. 378–404.
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© 1976 Stuart Holland
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Holland, S. (1976). Spatial Concentration Versus Dispersion. In: Capital Versus the Regions. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-15773-0_7
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