A Growth Pole and the Strategy
(This is writing for an examination for reginal economics.) T.Miyoshi
A growth pole has been mentioned by Perrox. His point of view had been influenced by Shumpeter's view, "new production activity destroys old", so Perrox argued that the location of economic activity shifts by a succession of more dynamic sector and the spatial economy is moving overtime. From this point of view, Perrox has considered growth is not a spatial over-whole phenomenon, and a spatial concentration of economic activities is inevitable where one activity attracts one another. Thus, there must be an agglomerated complex of industries that has been called "a growth pole."
In the growth pole, there are two sets of inequality. One is between the growth centre and the zone of influence, and another is between the zone of influence and the non-zone of influence.
What's the contents of the growth pole? The growth pole needs "propulsive industries" which stimulate the economic activities of the growth pole. Propulsive industries have been mentioned by Boudeville, who has argued that "the development pole is a complex of economic activities agglomerated around propulsive activity". The propulsive industries are characterised by constituting the growth pole, large-scale, rapid growing, high-technology, capital intensive technology, high income elasticity, and so on.
As other conditions of the growth pole, well-established infrastructure, appropriate central service, and demands are necessary. Since previous two conditions are strongly related with the government policy, the government has a key role to decide the location of the growth pole, although there is no practical theory for the location.
Hirshman has developed this concept and has advocated a growth pole strategy called "unbalanced growth strategy". In this strategy, Hirshman has argued that the propulsive industries must produce basic or intermediate goods for more linkage effects and they must be in a large town rather than small. Furthermore, he has expected "trickle down effects" which lead to regional convergence overtime.
This Hirshman's view has been strictly criticised by other economists. Myrdal has considered spread effects and back wash effects alongside growth, and he has concluded the back wash effects have been more stronger than the spread effects, because economic factors (labour and capital) tend to move from the hinter-land to the growth centre.
Friedman has considered 6 core-periphery effects (dominant, information, psychological, modernisation, linkage, production) and has witnessed all effects are favourable to the growth centre.
Moreover, according to Hassen, "the twenty-years evidence of experiments with the growth pole strategy to date largely supported Myrdal's view." Some studies have shown "trickle up effects" and "spatial discontinuous of spread effects".
To counter this view of anti-growth pole strategy, however, Richardson has argued " the disenchantment of growth centre strategy in many countries is not the evidence that the principle of the strategy is wrong." He has attributed it to the failure of implementation, such as over-optimistic and short-run planning of unskilled policy makers.
However his argument can't be fully support for the growth pole strategy, and it has shown the problems in considering the growth pole.
Firstly, what the principle of growth pole strategy means is not clear. It must various by the policy from agriculture to industry, from rural to urban, from unemployment to rapid economic growth and so on. In addition, the location of a growth pole is also various by the political objective. For example, if the objective is regional equality, the growth pole must located in rural area, while it is against the objective of economic growth.
Secondly, the cost of the growth pole must be considered. It is not only in terms of comparison between income per capita and cost per capita, but also in terms of social cost, such as poverty, crime, pollution, etc.
Thirdly, the growth pole is not sufficient condition of growth itself. For example, Scotland's automobile assembly couldn't bear spread effects because of spatial discontinuous of linkages.
Therefore, since there are serious side-effects and the general objective is not clear, the growth pole must be dealt just as an economic phenomenon, it must NOT be dealt as an all round strategy for development.
I've got 60 marks. so so..