Why cities are regarded as productive engines of growth? Topic 4 P3



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Region-Quiz-25

balanced nor equal?
Topic 4 -> Presentation -> Slide 18 and Google

  • The existence of a core-periphery structure implies that in the spatial dimension (space and place), the socioeconomic development is usually uneven. From such a geographical perspective, the regions known as the “core” are advanced in various areas, while other regions described as the “periphery” serve as social, economic, and political backstage, backyards, and supply sources or - in some cases - are even subject to degradation and decline. Furthermore, the level of development has a negative correlation with distance from the core. The economies of the states that have gone through various stages of development at the earliest and with the fastest pace have become wealthy core regions and growth poles. Those countries and regions where these processes have been slower become or remain the poor periphery.

  1. growth pole theory – forces that form the basis of most growth pole,

Topic 4 -> Presentation -> Slide 16

  • economic growth is stimulated by the most developed sectors and branches of industry and by specific enterprises which constitute a kind of growth poles of the whole economy,

  • these poles are characterised by a significantly high rate of economic development and numerous cooperative connections, as well as the strongest position in world markets,

  • growth pole and its relations with the environment create a spatial system called the polarised system -- highly developed regions as the growth poles, innovative and competitive sectors and branches are located there,

  • growth poles metropolitan are dominate over weaker centres and regions

  • the role of the authorities is to the relations (new investments create new growth poles and to strengthen in communication and metropolis and the region in order transport) between to intensify diffusion and stimulation of , economic growth

  1. product cycle theories - stages of a product’s life in a spatial scale,

Topic 4 -> Regional developmet theory – article 1 -> Slide 12

  • Markusen’s (1985) profit cycle theory is one modification of the product cycle approach that responds to several of Taylor’s (1986) criticisms by incorporating a focus on industry structure at various stages of a product’s history. According to Markusen, sectoral change within regions corresponds to one of five “profit cycles” that are determined by the structure of competition at various stages of product development. Initially, sectoral development precedes from a period of zero profit toward a period of super profits, where initial innovators earn monopoly profits. The sector then enters a normal profit stage as new firms enter the market. Eventually, the market becomes saturated, and destabilizing factors set in. During this phase, firms either tend toward oligopolistic forms of organization to gain additional profits or the firms enter a stage of decline, as substitute or imported products take over the market. The final “negative profit” stage is one of sectoral decline and disinvestment.

  • Each stage in Markusen’s (1985) profit cycle is characterized by unique spatial relationships. In the initial stages of a product’s life, the location of firms is largely determined by historical accident or by the physical location of the innovation. Entrants into the market may be drawn to the location of the initial innovation or to regions whose resources are favorable to the industry. During the “superprofit” stage, industries colocate to benefit from knowledge spillovers and a localized skilled labor force. Eventually, firms grow in size, diminish in number, and become increasingly oriented toward the location of consumer markets. If the industry tends toward an oligopolistic structure, firms will tend to concentrate to take advantage of market power resulting from proximity to consumer markets and location-oriented political supports. During later periods, oligopolies seeking to minimize labor costs may relocate to escape unionization. If firms enter a final stage of decline, the spatial tendency will be one of divestiture and gradual abandonment of location specific facilities.

  1. flexible specialization and network theory – factors making production to be designed to permanently respond to change on the market,

Topic 4 -> Regional developmet theory – article 1 -> Slide 14

  • In the factor-driven stage, internationally successful industries draw advantages from basic production factors. Eventually, nations may enter an investment-driven stage, where firms and the national government invest locally to transform local basic factors into more advanced factors of production, eventually reaching the innovation-driven stage of national development, when all determinants of competition are working at their strongest. The final wealth-driven stage is the beginning of a period of decline, caused by a reduction in the number of successful rivals and a trend toward capital preservation rather than capital accumulation

  1. concepts of regional innovation networks - local innovative environments and entrepreneurship as a stimulus of innovative behaviour and growth,

Topic 4 -> Theories of Regional and Local Development – Abridged Review -> page 80, 81

  • The concepts of regional (local) innovation networks (territorial production systems) are related to the above concept. The research group GREMI studied the influence of local environment on the innovativeness of economic activities; the group assumed that it is determined by a proper institutional structure and network of information and cooperation. GREMI introduced the concept of a “local innovative environment” as an innovation incubator and a “knowledge machine”. They were defined as a net of complex informal, social relations in a given territory, determined by its local identity, culture and tradition. Such a unit strengthens the process of group learning, i.e. an integrated process of producing and spreading information. In this context, the term “learning region” was introduced in the 1990s as a model for group and institutional “learning” used to analyse the phenomena of competitiveness and economic growth of such areas as Silicon Valley, Medical Alley in Minneapolis, Cambridge, space industry in Toulouse (Olejniczak, 2003).

  1. theory of industry clusters – how do the clusters use the competitive advantage in contemporary global economy?

Topic 4 -> Theories of Regional and Local Development – Abridged Review -> page 82,83

  • The contemporary world as a mosaic of various epochs occurring concurrently in the global space is significantly diversified, hence the vision of a world state remains a nostalgic longing for a just international order. We witness the birth of the vision in the face of the global catastrophes of the 20th and 21st century and the simultaneous actions of UNESCO aiming at a unified world civilization. The centre/periphery paradigm continues to function not only in the centre of world economy, but also in its peripheries due to a specialised, mobile, international metropolitan class, which, regardless of race, religion and language, operates on the international labour market. This social group, according to Martin and Schumann’s (1999) “a 20:80 society” formula, comprises 1/5 of the society which develops world integration, while the remaining 4/5 are the redundant, ineffective masses, less useful than intelligent technologies. According to the Tofflers (1993) the world is divided (with respect to global modernisation dynamics) into: 1) the world of the metropolitan class integrated in “info-sphere” and ”megacorps”, 2) the static world of the declining industrial epoch (“industrial rust belt”). The above-mentioned authors predict conflict not between civilisations (like Huntington), but between dynamic and static cultures, in which the former will combat the latter in a specific “war substitute”. By analogy, global and local zones can be distinguished in every country (region). The former will integrate with the international market, while the latter will remain in civilisation regress.

  1. the new economic geography – why firm decide to choose locations with a large local demand?

Topic 4 -> Why regional development matters for Europe’s Economic Future -> page 2

  • The role of geographical space in lowering barriers and costs of knowledge sharing and transmission across a range of networks as a decisive factor behind the strength of cities, industrial clusters and regional innovation systems.

  1. ‒ the concept of ”path dependence” – is it possible to overcome the "historical accidents" that hinder new developments and general living conditions on a region's development chances?


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