Geography Reference
In-Depth Information
described the bell shape of regional disparity and postulated that regional policy
was most appropriate for the intermediate phases when disparity was greatest.
There are good reasons why this should be so. Although regional disparities in
income and welfare may be greatest for the fast-developing nations, the level of
public awareness is perhaps not so high. We have no measures of this awareness,
but it may be surmised that in countries that have only recently attained
democratic government, awareness of issues high on the political agendas will be
poorer than in countries with a long democratic history. Policy to help problem
regions becomes important only when those regions, or the politicians
representing them, make public protests that must be heard. In addition, people's
concern for equity is probably heightened by some of the education and
socializing processes of development. Apart from these considerations, it may be
economically the most appropriate policy to do nothing, or do the minimum, in
terms of regional policy for poor countries. Here it is worth recalling the
tremendous migration waves leaving the countryside and reaching cities like
Seoul or Taipei, or even Barcelona and Madrid in Spain in the 1960s. It is hard to
imagine regional policies that would keep the rural masses in place and
employed in these countries, and stem urban growth in the metropolises. Nor could
the investment money be expected to be available in these countries. In summary,
while national intervention for development seems most appropriate at an early
stage, intervention for regions becomes more relevant at a later stage when there
are heightened levels of awareness about regions and special groups.
The second major conclusion to be noted is that the recent success stories in
development have been spatially concentrated. The cases of Taiwan and South
Korea could be amplified by reference to Hong Kong and Singapore, or to the
earlier case of Japan itself. Within Latin America, where development has been a
much weaker process through the following of different policies, the exceptions
have been individual regions where concentrated urban industrial development
has been possible. Thus, for example, the region of São Paulo in Brazil, or the us
borderlands of Mexico, constitute regions of exceptional dynamism within large
countries that have made only halting progress over the last few decades. On
what grounds can it be argued that concentrated development should be
successful? The benefits of concentration for industry are well known: the linkages
between firms, vertical and horizontal, forming external economies for firms, the
economies of scale, the size of markets. What needs to be explained is why
having extra territory seems to be a negative feature. One suggestion by
economists is that focusing a whole national economy on a primary export has
negative effects on the rest. This concept is called “Dutch disease”, having been
identified for Holland in connection with its natural gas industry in the 1960s,
which boosted all industries related to gas and raised costs, especially labour
costs, across the nation. This meant that Holland's traditional export goods
became too expensive and there were economic problems as a result. The
connection between Dutch disease and concentrated development is that primary
resources tend to be widely spread, so that concentration is not possible. This
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