Growth pole theory pdf

A more comprehensive territorial approach seemed to be more appropriate for both rural and urban development. Even in the developed world, Dutch national planning experience aimed at correcting regional imbalances by earmarking less developed areas for growth during the s and s did not have the desired spread effect in the surrounding area.

It has since been realized that the failure was not of Perrouxs growth pole theory but of its faulty application as a space-bound concept, and a remedy for all regional underdevelopment.

Today, as economic interaction encompasses macroregions and becomes globalized, Perrouxs original theory seems likely to find validation. A recent example of such growth pole effects may be found in the Silicon Valley in San Jose, California. The information technology IT industry here grew at a meteoric rate in the s, but the economic stimulus was not restricted to the state of California or even the United States. Its impact was felt through increased employment and social development in the developing countries of Asia halfway around the globe.

He and others have written about the concept extensively and yet, despite this or perhaps because of this, there is no consensus as to what it means. There is considerable intuitive appeal of the concept and so it has had influence on policy makers. The policy makers presumed that economists could supply the technical analysis needed to make sense of the policies based upon the concept of growth poles.

The intuitive notion of growth poles would identify a growth pole as an industry or perhaps a group of firms with an industry. At an extreme a growth pole might be a single firm or it might be a group of industries. Perroux, however, defined growth poles in terms of what he called abstract economic space. Perroux conceived of abstract economic space to be of three types: 1. For Perroux the aspect of dominance was important for growth poles. A firm or industry A is said to be dominant over B if the flow of goods and services from A to B is a greater proportion of A's output than the flow from B to A is of B's output.

A large firm or industry that has a high degree of interaction with others and is dominant in that interaction is said to be propulsive. The process of development of a propulsive firm or industry is called polarization. Perroux and other writers on growth poles try to base the concept on the notions of external economies, agglomeration and linkages.

An external economy exits if a change in the output of one firm or one industry affects costs in other firms. External economies of scale may be negative, as in the case of pollutions costs, or they may be positive, as in the case of the development of integrated circuit technology in the electronics industry.

Linkage is a concept developed in regional economics. Linkages may be forward or backward. If a growth in production in one industry stimulates production in the industries supplying it then that industry has backward linkages.

For example, the steel industry has backward linkages to the iron ore mining industry, the coke and coal industries and the transportation industry involved in transporting those inputs to the steel industry.

A forward linkage when the availability of the output of an industry make possible the production of industries using that output. For example, the plastic producing industry makes it feasable for businesses requiring plastic to begin operation. The French economist, J-R. Bourdeville made a study of the steel industry of the Brazilian state of Minas Gerais as a growth pole.

Despite Perroux's denial that growth poles are geographic many of the applications of the. These applications often are enlightening. For example, the regional economy of Paris can be considered to be a growth pole.

The case of Paris shows that effect of polarization on the surrounding geographic area is not always positive. The attraction of Paris has been so great that it has been extremely difficult to promote any economic development in the area outside of the Paris region. French planning literature refers to this as the phenomenon of Paris and the French Desert.

In the U. Growth centers are related to the concept of agglomeration. In many ways the American work on growth centers is virtually independent of Perroux and the French literature on growth poles. Albert Hirschman uses the term polarization to refer to the negative impact of a growth pole on surrounding regions.

Trickling down is the term he uses for the positive impact of a growth pole or growth center on adjacent regions. Gunnar Myrdal, the Swedish economist, use the terms backwash and spread for the same concepts as Hirschman's polarization and trickling down.

The American economist, John R. Friedman, has developed a concept that is related but distinct from the ideas of growth poles and growth centers. It is called the matter of the center versus the periphery.

Friedman developed this idea in analyzing the relationship of the interior regions of Venezuela to the coastal regions. Altogether the concept of growth poles has been of only marginal importance in analyzing regional economic problems.

Nevertheless the idea of growth poles has had a major role in formulating regional policy. Open navigation menu. Close suggestions Search Search. User Settings. Skip carousel. Carousel Previous. Carousel Next. What is Scribd? Explore Ebooks. Bestsellers Editors' Picks All Ebooks. Explore Audiobooks. Bestsellers Editors' Picks All audiobooks. Explore Magazines. Editors' Picks All magazines. Explore Podcasts All podcasts. Difficulty Beginner Intermediate Advanced. Analysis of co-oc- currence of synthetic indicators relating to the above types of capital and growth tendencies in the years — and — in Poland showed that the high- est values of synthetic indicators of all types of capital occurred in the sub-regions with the strongest growth tendencies, while the lowest in the sub-regions of weakest growth trends.

A territorial growth pole is an area characterized by a high level and dynam- ics of development and being the source of spreading growth to the surrounding territories. Growth tendencies distinguishing this area are the result of the presence within its territory of innovative industries and externalities from them as well as the effect of existence of a system of interdependent developmental factors forming the following types of capital: natural, physical, financial, intellectual, socio-economic and administrative.

This pole generates spill-over growth effects on neighbouring territories. Innovative industries, especially high technology manufacturing and ser- vices, and knowledge-based entrepreneurship require specific conditions of location, based on knowledge, and thus invest primarily where certain development factors are present, such as human capital, knowledge infrastructure, and an innovation-ori- ented infrastructure.

Particularly high values of intellectual capital are not evenly distributed due to the inability to create f. Therefore in the knowledge economy growth will be increasingly driven by territorial and local growth poles. Intellectual capital and innovative in- dustries are key, but not the only condition of strong growth tendencies in the area.

Growth pole theory as a concept based on innovation activity development … 23 Many of the development factors included in the above groups of capital will also support the development in the area of innovative industries Scheme 1. Scheme 1. The model of territorial growth pole as the system of developmental factors Source: Author For the purpose of checking the impact of the above types of capital, such as natural, physical, financial, intellectual, socio-economic and administrative cap- ital on growth tendencies appropriate variables for each development factor were assigned and synthetic indices were calculated referring to different types of capi- tal.

The linear and in some cases if needed spatial lag models showed significant positive impact on growth tendencies in the years — and — of all the above kinds of capital. Moreover spatial lag models showed that significant positive impact on growth tendencies in the sub-region direct effect and five near- est sub-regions indirect impact had changes in intellectual, socio-economic and administrative forms of capital. Also spatial lag and error models showed that one of the key determinants of the average annual GDP growth per capita in Poland was the dynamics of employment in innovative industries.

This dynamics translated into an increase in real GDP per capita, not only in the sub-region direct impact , but also in the five closest sub-regions indirect impact. The significance of the spatial error model showed that also the error term and values other than the variables included in the model within the 5 neighbouring regions had significant impact on the average annual real GDP growth per capita in Poland Wojnicka-Sycz Innovation activity and knowledge diffusion as crucial development factors Overview of about articles in national and international literature on the actual impact of the theoretical factors of economic development on countries and regions showed that not all of these factors always have a positive impact on eco- nomic growth.

Wojnicka-Sycz Often effects of respective factors are con- troversial — studies give different results depending on the country, the time and the analysed variables. This shows that context in which the factors are analysed is important. Studies also show that there is interdependence of different factors — individual not sufficiently explain economic growth and empirical models usually involve several factors simultaneously.

Very often there is a nonlinear relationship between development factors and their positive impact. In many cases, the increase in the intensity of a factor such as social networks or institutional thickness, and for- eign investment, and the level of education of the society, as well as concentration and agglomeration will have a positive impact on the development to a certain level, but then the excess of a factor will make the returns from it diminish, and eventually it may begin to affect growth adversely, such as congestion due to the concentration of economic activity and population in one place.

For some factors, on some level, especially if the area — a region or country is a pioneer in the field, such as ICT in- frastructure, it will be the winning factor, that is determining the competitiveness, but as it spreads it will become a prerequisite without which it will be impossible to achieve further development, but it will not assure progress faster than of others.

Some developmental factors such as migration and human capital, indicated both in the theories of economic growth of countries and regional development theories, will have a different impact, in the light of empirical research on the country level and other at the regional level. This is due to different types of entities which we refer to — the states are still more separate and distinct, even in integration groups than regions in a country. Moreover, in the case of regions of one country generally the comparability of data will be better than between countries, and therefore the results of analysis may be more accurate.

The most obvious link between regional and national economic growth, in the light of the review of the empirical articles, occurs between innovations and therein, as well as between economic development and the factors related to knowledge, investment and exports Fleisher et al.

Externalities from the location close to dynamic areas and the knowledge diffusion effects also definitely positively influence growth Quigley , van Stel Important for development, particularly regional and local, is also leadership, initiative, and the presence of leaders who inspire positive change Stimson et.

Among the policies the most clearly associated with develop- ment is the policy combatting corruption, since the latter weakens economic growth Del Monte and Papagni Growth pole theory as a concept based on innovation activity development … 25 Table 1 shows the relationship between the development factors and economic growth in the light of empirical research.

Table 1. Innovation Reversed It is important to participate networks U-shape in them, but in networks not limiting competition or in complementary networks. Social capital Reversed It depends on the type of U-shape social relationships — open networks are pro-growth, closed are anti-growth.

There are also disadvantages of excessive agglomeration, even of in- novative companies in one place, because they have to cope with increased compe- tition. Institutions Reversed Too small institutional thick- U-shape ness reduces growth, too large also, important are not only formal institutions but also informal. Public institu- tions should not crowd out private activity. Human capital is crucial in the development of less developed regions and countries, although the re- sults are varied in relation to the rate of growth, particular- ly at the level of states.

Income Reversed If they are moderate they and educational U-shape may stimulate economic de- inequalities, velopment. Source: Wojnicka-Sycz, The increasing importance of knowledge and innovation activity for econom- ic development means that development will occur more and more in certain points, because not all locations are able to have universities, research centres, and attrac- tive environment for creative and high technology activities, and it would not be good for the economy if every location had such advantages.

Promoting the development of productivity must nevertheless be followed everywhere, on the basis of bottom-up local initiatives, supported by relevant activities at the regional and central levels, but strong growth poles may not be built in each place. The concept of growth poles corresponds to the above scheme of innova- tive development based on some centres — poles or locomotives and the spreading of growth from them. Particular locations should try to find the right driving forc- es for themselves, but they must be adapted to certain conditions and possibilities.

With regard to the concept of growth poles, it is important to draw on the experi- ence of Japanese, and recent Greek strategy where with the use of growth poles the aims of both economic growth and a certain alignment of development are achieved Christofakis et al.

This may be done by directing productive industries not to major metropolitan areas, but to other major cities, with suitable conditions for their development, as was done by the growth pole strategy in Japan in the 60s.

In the Greek case growth poles strategy is supplemented by endogenous development. This is also true from the perspective of the necessity of having a hier- archy of cities for the diffusion of growth effects and innovation, which was noticed in both theory and empirical research.

At the same time, due to the need for inter- national connections, the location of productive industries in the area often depends on the presence in the vicinity of such facilities like airports and highways, but they would not necessarily want to invest in the city, especially in the case of manufactur- ing.

This corresponds to the location of the industry mainly in metropolitan area and not in metropolis themselves. As a result as innovative growth centres today appear rather metro-regions than the cities-metropolis themselves. It is also important to complement growth pole strategies with stimulating of endog- enous potential of territories. Studies on growth poles show that this term is used in different contexts. Also the aims of growth pole strategies were changing. Currently such strategies are mainly aimed at national competitiveness in the form of development of metropoli- tan areas in polycentric systems of cities than at restructuring of weak regions, which was often the case in the 60s and 70s Parr , Knapp, Schmitt , , EIB Two major elements of growth poles may be indicated, such as the presence of propulsive industries and the benefits of agglomeration which are achieved main- ly in certain urban agglomerations.

Instruments supporting poles of growth have evolved and now increasingly involve the formation of pro-innovation infrastructure — like technology parks.

House , Hansen In some countries, particularly developing ones free trade zones were used as an instrument in growth pole strate- gy Chien i Yang Many researchers currently consider clusters as a modern form of growth poles Li , Ganne, Lecler , Heijman , MG Growth pole theory as a concept based on innovation activity development … 31 Increasingly, the contemporary growth pole must be the pole of innovation in order to be effective Niosi and Zhegu Innovation is stressed not only by the most developed countries but also by developing states, which already have had success in terms of economic growth, such as China Chien and Yang Conclusions Innovation aspect was indicated by the authors of the original growth pole theory.

The analysis of empirical literature showed that in fact knowledge leading to innovations is the least controversial development factor, that is factor that in all the analysed studies have proved its positive impact on economic growth. The model of territorial growth pole verified for Poland also showed the key importance of inno- vative branches but also of other development factors, among them of intellectual capital for formation of territorial growth poles.

The model of territorial growth pole adjusts the growth pole theory to con- temporary conditions of the knowledge economy, especially the importance of in- novative industries, indicated in the original theory, but with less emphasis, as the propulsive factors were not necessarily considered the most innovative industries, but such as steel or petrochemical industries. Furthermore, the analysis has shown that propulsive industries and their links are not enough for the area to became a ter- ritorial growth pole, and actually the coexistence of many different growth factors is needed.

It also shows why many of the growth pole strategies, which consisted in stimulating the development of disadvantaged areas by the location there of propul- sive industries, without the development of necessary complementary development factors has failed.

References 1. Campbell J. Chien S. Christofakis M. Del Monte A. Doloreux D. Fleisher B. Ganne B. Ganstho M. Hansen N. Heijman W. Higgins B. Hite A. House J. Knapp W, Schmitt P. Kuehn J. McCann P. Capello, P. Nijkamp, Handbook of regional growth and development theories. McKee D. Obszary wiejskie, Warszawa. Miyoshi T. Growth pole theory as a concept based on innovation activity development … 33