What Are The Implications Of Membership Of — страница 2

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competition” (ibid, 296). While there is very broad agreement that the immediate effect of this will be a widening of the productivity gap between regions, there are those who argue that in the long term integration will facilitate regional economic convergence. This essentially neo-classical contention is based on the premise that, with increasing integration, inefficient production is rooted out, providing aggregate benefits for the union as a whole, while factor mobility facilitates equalisation of regional factor payments (Jensen-Butler 1987). In this theory the more efficient resource allocation thus engendered will then induce both aggregate growth of the union economy and a reduction in regional inequality (ibid). The experience of Britain and other nation states,

however, refutes the assumption that a lack of trade barriers and therefore infinite theoretical factor mobility within a given area leads inevitably to the removal of regional factor payment differentials. A more likely scenario gaining much acceptance within the literature is based on a Myrdal-Hirschman model of cumulative regional development (ibid). Generally speaking, those regions in an advantageous position within the system due to such factors as well developed infrastructure (roads, airports, communications etc.) and skilled workforce will attract the most investment, leading to high productivity increases, in turn leading to significant in migration (EC 1990). The effect is to increase the size of the regional market and tax base, allowing further improved

infrastructure and inter-industry linkages which in turn facilitate new rounds of investment (Jensen-Butler 1987). In short, “the gap between regional multipliers in fast and slow growth regions widens” (ibid, 216). Polarisation will therefore tend to increase progressively from stage (1) through to stage (5) and thus the regional economic effects for Britain will be highly dependant on the extent to which the Union progresses to steps (4) and (5) (Jensen Butler 1987, Nevin 1990). It is likely, then, that uncontrolled integration would lead to the divergence of regional development in both Britain and the EU as a whole. It is also important to note that integration has the effect of decreasing the power of national governments over such development due to two reasons.

Firstly, increased competition from the expanded market will make national governments hesitant to prevent additional development in the most prosperous regions for fear of losing productive potential to other countries of the Union. Secondly, in the new wider market, an increased proportion of income generated by development in a given region will be spent on imports, reducing the local multiplier effect and making regional policies less effective (Nevin 1990). In a monetary union rather than a common market, therefore, “each national government would be forced to give priority to securing the equilibrium rate of inflation for the country as a whole; the regional dimension would necessarily be relegated to second place” (ibid, 288). The likelihood of European integration

widening disparities between regions, then, is compounded by the reduced power of national governments to effectively combat such disparities. The effect of EC regional policy, therefore, is central to this discussion and must be evaluated before any conclusions can be made as to the overall effect of EU membership on British regional problems and policy. While the arguments for problems associated with the underdevelopment of depressed regions within the EC run much the same as those discussed previously for the nation state, the greater size and economic differentiation of the Community means that disparities between regional multipliers in poor and wealthy regions are likely to be even more pronounced than those for individual countries (Jensen-Butler 1987). The nature of the

EC as a supra-national entity whose members have distinct and often opposing national interests, however, has made the formulation of effective Community wide regional policies highly problematic (Martins and Mawson 1982, Cheshire et al. 1991). The first steps towards a common EC regional policy were taken in the 1960s (Cheshire et al. 1991), although this period was characterised by an emphasis on the “avoidance of abuses rather than the creation of policies” (Nevin 1990, 291). The early 1970s saw a major growth in interest in a Community, rather than national, regional policy, due largely to the emergence of monetary union as an EC objective and the large increase in unemployment after 1973 (ibid), although paradoxically the balance of responsibility for regional policy