GROWTH AREAS, GROWTH CENTRES AND REGIONAL CONVERSION*
| Published date | 01 February 1970 |
| DOI | http://doi.org/10.1111/j.1467-9485.1970.tb00484.x |
| Author | Gordon C. Cameron |
| Date | 01 February 1970 |
GROWTH AREAS, GROWTH CENTRES
AND REGIONAL CONVERSION*
GORDON
C.
CAMERON
1.
Introduction
One
of
the most fashionable and persistent forms
of
conventional wisdom
is that a policy for faster economic growth in old declining industrial regions'
must
be
based upon a growth area strategy.a Implicit in this view
is
the
belief that any economic system which permits private companies to expand
anywhere within the problem region will generate a lower growth rate than
an explicit planned policy which discriminates in favour of
a
limited number
of areas with especially high growth potential. Thus for any given level
of
public investment it is assumed that regional net value added will
be
maximised if the government deliberately fosters the growth
of
certain areas
and deliberately neglects to provide the same investment support for all
other areas with aspirations for development.
The belief in spatially unbalanced growth, or to put it in another way,
in the possibilities
of
simulating on the micro-spatial scale the growth
environment characteristics of the leading regions,
is
usually based on four
arguments.
i)
A
planned build-up of infrastructure in optimal sites will avoid the
unwanted externalities associated with private development in excessively
large and congested cities and the high marginal costs of providing public
infrastructure to support private growth in minor centres
of
activity,
ii) For any given level of subsidy, investment in spatially concentrated
infrastructure is likely to maximise the flow into the region of exogenous
capital.
iii) Over the long-run, the spread effects
of
spatially-unbalanced growth
are likely to be substantial as the growth areas become the leading regional
centres of innovation and technical esciency.
iv)
A
commitment to provide specific amounts and types
of
public
investment in selected sites will facilitate the formulation
of
regional
economic goals and thereby the establishment of priorities for public invest-
ment in quantitativc and spatial terms.
*The author
is
grateful
to
Resources
for
the Future Inc., Washington
D.C.,
for
providing financial support during the writing
of
this paper.
Regions in the
U.K.
such as the North-West and North-East
of
England, the
central belt
of
Scotland; the Ruhr in West Germany, parts
of
Pennsylvania in the
U.S.A.
and
so
on.
2Throughout the paper, the term growth areas will be taken to include urban
growth centres within the growth area.
19
20
GORDON
C.
CAMERON
All of these arguments relate to the general rationale for a growth area
approach-the
'
why
'
of such a policy. However this rationale cannot
be
separated from the methodology of growth area selection-the
'
how
'
of
the policy.
In
the first part of this paper, the analytical basis
of
spatial
discrimination will be examined in the context of the four arguments
previously noted. The second part of the paper will
be
devoted to a brief
introduction to growth area selection.
As
an
initial step, certain simplifying, though realistic, assumptions will
be
made. The focus of the study is the investment strategy of
a
regional
authority which has powers to influence the spatial incidence of all public
investment. This will include investment which results from using the
revenue from local or regional taxes and user charges, central government
investment grants which are allocated region-by-region on the basis
of
population, central government grants and loans which discriminate
explicitly in favour of specified lagging regions and investment which
is
dependent
upon
issues of stock. Powers to provide cash grants, loans or
tax
remissions directly
to
existing or incoming private companies which
wish to expand within the region, are not vested in the regional authority
but in the central government. However, the authority will have the right
to specify particular areas within its region which will receive a higher
level or duration
of
company grants, loans and remissions and of discrimina-
tory public investment (i.e. growth areas). This old, industrial region will
be
suffering from an outdated structure which generates a low rate
of
income growth per capita, persistent net out-migration of labour, heavy
unemployment, and a persistent deficit on the balance of payments with the
rest of the world. Spatially, the region is divided into two broad zones, one
which consists of numerous dense urban areas many of which are large
both in terms
of
population and economic activity, and
a
hinterland zone
of
small, scattered urban
settlement^.^
In these conditions, the goal for remedial policy is seen as a significant
increase in the level of regional net value added. Such an mcrease is the
means whereby sufficient investment and job opportunities will be created
within the region
so
as to accommodate a growing labour supply generated
by natural increases and an official desire to prevent further serious labour
losses to competitor regions. The critical question then
is
whether a growth
area strategy, given the resources involved, will encourage a greater inflow
of exogenous enterprise and capital and a more rapid adaptation to changed
demand conditions by indigenous producers, than any alternative spatial
strategy.
Two actual examples may aid understanding
of
this distinction.
In
N.E.
England,
the area around and
to
the east
of
the
A.l
road can be regarded (very broadly) as the
zone
of
dense activity, that to the west the hinterland.
In
Lancashire, the area immedi-
ately around and to the west
of
the
M.6
motorway, can be seen as the dense zone,
that to the east the hinterland.
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