Geography Reference
In-Depth Information
In the case of major flows which are to have an impact on a country's
development, most of the relevant flows are not money movements, but what is
called fixed investments, i.e. capital put into building factories or roads in order
to produce goods in the target country. Such investments are “lumpy” (i.e. they
come in large amounts or not at all) and firms study carefully where and how the
investment will be made. This kind of investment is also highly visible in the
object country, so that political considerations may come into play. In countries
with powerful nationalist movements, national government may find it is
undesirable to bring in foreign firms which wish to show off their products or
technology, and even their higher wage levels may be an object of criticism by
local firms which cannot compete. In the countries of Latin America, inward
investment in factories was spurred by high tariff barriers, taxes on imported
goods which were so high as to make it advantageous to set up a local factory in
the country and bring in parts to be assembled there, even if this was at high
cost.
Labour migration
Similarly, labour movement is not a simple economic process of movement of
individual workers to high-wage areas. Instead, labourers belong to families and
the whole family is involved in decision-making. Families may decide not to
migrate because of their sentimental attachment to a home village or ownership
of land there. A positive decision to migrate may be driven by social factors
(contacts in the city, family friends, friends to help with employment or
accommodation) more than economic ones. It would also appear that much
migration is driven, not by present wage differences, but by the long-term
probability of improving the family situation through education and moving up
the employment ladder. Information is vital to the decision to migrate. Big cities
become the target of much modern migration, partly because these are the cities
that potential migrants have heard about, via radio, television and other sources
of information.
Other criticisms were made over the years, including the concentration of the
neo-classical theory on production, and its failure to consider distributional
problems: in other words, was the production being consumed by the population
at large or by a small elite (Friedmann 1988, Ch. 2)? There was also a historical
critique, to say that the development paths of the poor countries were not and
could not be like those of the now developed countries. W.W.Rostow's model of
development could not be transferred straight from eighteenth century western
Europe to the rest of the world.
Spatial versions
There is no precise “geographers' version” of the neo-classical model, nor can
there be, as transport costs are assumed to be negligible, contrary to all the
