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Regional Policy: An Alternative Approach

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  • Alexiadis, Stilianos

Abstract

The regional policy problem is often conceived as a trade-off between aggregate efficiency and interregional equity. A policy to allocate investment across regions frequently causes a contradiction in the aims of regional policy, in the sense that it might lead to high rates of aggregate growth accompanied with an unequal distribution of income across regions. On the other hand, a policy to reduce regional inequalities may in fact be inefficient to promote growth of the economy as a whole. It is argued further that under certain conditions the contradiction between aims can be avoided.

Suggested Citation

  • Alexiadis, Stilianos, 2013. "Regional Policy: An Alternative Approach," MPRA Paper 47063, University Library of Munich, Germany, revised 2013.
    • Handle: RePEc:pra:mprapa:47063
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    References listed on IDEAS

    as
    1. Smith, Paul E, 1970. "Recent Approaches to Dynamic Stability in Macro-Economic Models," Public Finance = Finances publiques, , vol. 25(1), pages 1-23.
    2. MICHEL, Philippe & PESTIEAU, Pierre & THISSE, Jacques-François, 1983. "Regional allocation of investment with distributive objectives," LIDAM Reprints CORE 523, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    3. Anisur Rahman, 1966. "Regional Allocation of Investment: The Continuous Version," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 80(1), pages 159-160.
    4. Ron Martin, 2008. "National growth versus spatial equality? A cautionary note on the new ‘trade-off’ thinking in regional policy discourse," Regional Science Policy & Practice, Wiley Blackwell, vol. 1(1), pages 3-13, November.
    5. Michael D. Intriligator, 1964. "Regional Allocation of Investment: Comment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 78(4), pages 659-662.
    6. Akira Takayama, 1967. "Regional Allocation of Investment: A Further Analysis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 81(2), pages 330-337.
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    More about this item

    Keywords

    Optimal Control Theory; Regional Disparities; Regional Policy;
    All these keywords.

    JEL classification:

    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General

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