Regional Economic is WHAT IS REGIONAL ECONOMICS?Systems are of considerable importance. Such change affects the
well-being of individuals and ultimately the socialand political fabric of
community and nation. As social beings, we cannot help but react to the changes
we observe. For some people that reaction is quite passive; the economy
changes, and they find that their immediate environment is somehow different,
forcing adjustment to the new reality. For others, changes in the economic
system represent a challenge; they seek to understand the nature of factors
that have led to change and may, in light of that knowledge, adjust their own
patterns of behavior or attempt to bring about change in the economic,
political, and social systems in which they live and work.
In this context, regional economics represents a framework within
which the spatial character of economic systems may be understood. We seek to
identify the factors governing the distribution of economic activity over space
and to recognize that as this distribution changes, there will be important
consequences for individuals and for communities.
Thus, regional or "spatial" economics might be summed up in
the question "What is where, and why—and so what?" The first what refers to every type of
economic activity: not only production establishments in the narrow sense of factories, farms, and mines, but also other
kinds of businesses, households, and private and public institutions.
Where refers to location in relation to other economic activity; it
involves questions of proximity, concentration, dispersion, and similarity or
disparity of spatial patterns, and it can be discussed either in broad terms,
such as among regions, or microgeographically, in terms of zones,
neighborhoods, and sites. The why and the so what refer to interpretations
within the somewhat elastic limits of the economist's competence and daring.
Regional economics is a relatively young branch of economics. Its late
start exemplifies the regrettable tendency of formal professional disciplines
to lose contact with one another and to neglect some important problem areas
that require a mixture of approaches. Until fairly recently, traditional
economists ignored the where question altogether, finding plenty of problems to
occupy them without giving any spatial dimension to their analysis. Traditional
geographers, though directly concerned with what is where, lacked any real
technique of explanation in terms of human behavior and institutions to supply
the why, and resorted to mere description and mapping. Traditional city
planners, similarly limited, remained preoccupied with the physical
and aesthetic aspects of idealized urban layouts.
This unfortunate situation has been corrected to a remarkable extent
within the last few decades. Individuals who call themselves by various
professional labels—economists, geographers, ecologists, city and regional
planners, regional scientists, and urbanists—have joined to develop analytical
tools and skills, and to apply them to some of the most pressing problems of
The unflagging pioneer work and the intellectual and organizational
leadership of Walter Isard since the 1940s played a key role in enlisting
support from various disciplines to create this new focus. His domain of
"regional science" is extremely broad. This book will follow a less
comprehensive approach, using the special interests and capabilities of the
economist as a point of departure.