A history of human civilization shows that the underdeveloped countries co-existed and still are co-existing with the highly developed countries in terms of economic and social development. For instance, many poor and underdeveloped countries in Asia, Africa and Latin America are co-existing with the highly developed countries such as the USA, Japan and other countries in Western Europe and Asia.
Similar to that even within one country there are some relatively high developed regions and underdeveloped regions; and there are many such countries. The researchers and scientists are concerned with such situation leading to a divide in human development within the country and further expanding the differences in living standards in the world, and negatively affecting the sustainable development of mankind. Therefore, the scientists are trying to find the optimal ways to overcome this problem at the theoretical and thinking level and managed to achieve some results. A correct theoretical basis ensures a success in any practical activities.
The two principally different major trends of the regional development theory have been predominating in the world until 1990 of the 20th century: the first trend was private sector-led under the market economy based democratic system which dominated and still dominates in the existing highly developed countries, and the second one was based on so-called socialist system with the domination of the state ownership and which used to be dominated in the countries with the centrally planned economy. This trend was dominating in the former USSR, Eastern European and some Asian socialist countries as well as in Mongolia until 1990 . The significance of the second trend is falling down due to the complete change of the political system in the former socialist countries.
The basics of the existing main trend of the theory on regional development in countries with the market economy and the democratic system derived from several theories and concepts: 1) Export based theory; 2) Neo-classical theory on regional development; 3) Theory on development pole (center); 4) Theory on the new economic geography; 5) A new concept on the regional innovation.
A brief description of the above theories and concepts:
1. Export based theory. The founders of this theoretical trend are the scientists R.B.Andrews , J.S.Duesenberry and D.C.North . This trend is based on a concept that there is a great potential for the facilitation of regional development through a promotion and development of export oriented industries and services in the regions. Under this theoretical
framework a great importance is attached to the Regional Input-Output Analysis.
2. Neo-classical theory on regional development. This theoretical trend has been developed based mainly on the standard neo-classical model of economic growth within the neo-classical economic theory. The main concept of this trend is that even a small change in economy brings the changes in prices of goods and services, and the investors and merchants start to look at new opportunities. It uses a neo-classical model of economic growth provided that the if the capital accumulation increases in the certain economic region it leads to an increase of production of goods and services.
3. Theory on development pole (center). This theoretical trend was founded by the scientists F.Perroux, G.Myrdal, A.O.Hirschman and others. The hypothesis of this trend is that development poles (centers) of regions and sectors are considered to play a specific role in regional development. Within the framework of this trend an importance attached to the Center-Periphery analysis.
4. Theory on the new economic geography. This trend attaches a great importance to the link between the country and regional economic development. The basis of this trend is that the differences in development levels in different regions can be reduced based on the previously mentioned theoretical trends.
5. A new concept on the regional innovation. This concept is based on a notion that focus should be on establishment of a market that based on the regional studies, R&D, new technologies and new products. Based on the results of all these theoretical works it the defines policies on regional development, including the ways to overcome the challenges and resolve the issues in remote regions.
No comments:
Post a Comment