Michael Chisholm - Regions in Recession and Resurgence

ROUTLEDGE LIBRARY EDITIONS:
ECONOMIC GEOGRAPHY

Volume 1

REGIONS IN RECESSION AND
RESURGENCE

REGIONS IN RECESSION AND RESURGENCE

MICHAEL CHISHOLM

First published in 1990

This edition first published in 2015

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1990 Michael Chisholm

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Regions in recession and resurgence

MICHAEL CHISHOLM

St Catharines College, Cambridge
Department of Geography, Cambridge

1990 Michael Chisholm

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First published in 1990

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Students approaching problems of regional growth face a bewildering array of ideas and arguments, concerning both theory and practice. To understand the sharp differences in the way regional growth is explained, and the equally clear divergence of policy prescriptions, it is necessary to be aware of the diverse intellectual traditions which are drawn upon. Very often, these traditions are implicit rather than explicit. I have attempted to explain briefly the main relevant strands of economic thought from neo-classical ideas to supply-side thinking and to show how these map into divergent schools of thought about regional growth processes. Economic doctrine in general, and regional growth theory in particular, has evolved in the context of major changes in the global economy, and especially the increasingly open nature of national economies. Ideas concerning the reasons for trade and for the sources of national growth have changed quite markedly in recent decades. The changing empirical reality and the evolution of theoretical ideas have both had an impact on the way that regional economic growth is perceived.

Two main themes are evident. First, no school of economic thought neo-classical, Keynesian, monetarist or whatever has a monopoly of wisdom. The problem, therefore, is not so much to decide which is right, but to decide which throws the most useful light on which problems. The same conclusion holds for the various theories of regional growth, whether these be based on neo-classical assumptions of free mobility of the factors of production, export multiplier analyses or on entrepreneurship and innovation. In the second place, ideas concerning the sources of growth at the national level and the reasons for international trade have changed over time, to place greater emphasis on man-made attributes (capital, in the form of productive assets, and the skills and abilities of people and firms) relative to the endowment of resources and advantages of location.

In structure, therefore, this book is an extended essay, setting out a viewpoint and an argument, providing an approximate map of a large and complex terrain. The map is imperfect. However, I believe that it will be helpful as a guide, that it shows linkages between global and regional processes in a novel way, and that it will help to show the way in which general economic theory and theory about regional growth interact.

My own thinking has been influenced by the work of many people too many to recollect them all. I have a particular debt, though, to Bob Bennett for the encouragement which he gave at a crucial time when the ideas for this book were being formulated. Ross Mackay, John Parr and Eric Sheppard were all instrumental in sorting out particular issues, and John McCombie provided valuable comments on the formulation of economic theory. Two close colleagues, David Keeble and Ron Martin, have over the years provided considerable stimulus, and David was kind enough to read a draft of the entire text: his numerous constructive comments were very helpful. I am also much indebted to successive generations of students at Cambridge who have endured my lectures on the topics contained in this book, and also to graduate students at Minneapolis in 1988 who reacted to provocation with lively discussion. The drawings were all done in the Department of Geography, principally by Lois Judge, and Heather Jarman did a magnificent job in typing the final version.

To all of these people, and many more besides, I owe a considerable debt. Nevertheless, they must not be blamed for the errors of omission and of commission which undoubtedly exist for these, mine alone is the responsibility.

Michael Chisholm

Cambridge

February 1990

Much of [the] academic literature on trends in regional development at best gives very limited attention to global economic shifts and at worst either ignores them or takes them as given.

(Browett and Leaver, 1989, p. 33)

The 1950s and especially the 1960s were a golden age for macro-economic management and also for regional theory and policy. At both levels, it seemed that we had sufficient understanding of how economic systems work to be able successfully to intervene in order to achieve desired ends notably, greater equality of incomes and of opportunities as between individuals and between regions. In the more advanced countries, unemployment appeared to have been banished and output was rising strongly, to give regular increases in the level of real incomes. The social sciences had come, or were coming, of age. Logical positivism was in vogue and seemed, at least in the field of economics, to be justified by the successes which had been achieved in the management of national economies and of the global economic system.