Regional Problems and Location of Industry Policy in Britain

The definitions of the 'prosperous' and the 'less prosperous' parts of the country vary a little from study to study. All authorities include Northern England, Scotland and Wales within the less prosperous areas. The National Economic Development Council in their Conditions Favourable to Faster Growth, H.M.S.O., 1963, p. 14, have included Northern Ireland in addition. K.S. Lomax , 'The Less Prosperous Areas of the United Kingdom', London and Cambridge Economic Bulletin No. 47, September 1963, p. xi, includes the North-Western region as well as Northern Ireland, while F.W. Paish , 'The Two Britains', The Banker, February 1964, p. 89, also includes the North-Western region but omits Northern Ireland. In this paper the definitions of the 'prosperous' and the 'less prosperous' regions will generally follow the N.E.D.C. definitions.

See, N.E.D.C., op. cit., pp. 15-17.

F.R. Oliver , 'Inter-Regional Migration and Unemployment, 1951-61', Journal of the Royal Statistical Society, Series A (General), Vol. 127, Pt. i, 1964, Tables A2 and A3, pp. 68-69.

In a study of households that had moved in 1957-8 it was found that among those who had moved an hour's journey or more from their previous home there were more heads of households in middle class occupations than those with clerical or manual jobs. D.V. Donnison , 'The Movement of Households in England ', Journal of the Royal Statistical Society, Series A (General), Vol. 124, Pt. i, 1961, Table 7, p. 69.

See, L. C. Hunter , 'Unemployment in a Full Employment Society ', Scottish Journal of Political Economy, Vol. 10, No. 3, November 1963, p. 291.

Paish, op. cit., p. 94.

See, G.C. Archibald , 'The Phillips' Curve, Migration, and the Regional Multiplier' (to be published).

See, for instance, H. Makower , J. Marschak and H.W. Robinson , 'Studies in the Mobility of Labour, Analysis for Great Britain, Part II', Oxford Economic Papers , No. 4, September 1940, p. 59; A.T. Peacock and D.M. Dosser , 'The New Attack on Localized Unemployment ', Lloyds Bank Review, No. 55, January 1960 , p. 21, and H.W. Richardson and E.G. West , 'Must We Always Take Work to the Workers? ', Lloyds Bank Review, No. 71, January 1964 , pp. 35-48.

Ministry of Labour Gazette, Vol. 71, No. 6, June 1963, p. 234, and Ministry of Labour , Statistics on Incomes, Prices, Employment and Production, No. 8, March 1964 , Table E.7, p. 91.

Richardson and West, op. cit., p. 36.

ibid., p. 38.

See, B. Olsson , 'Employment Policy During the Recession', Skandinaviska Banken Quarterly Review, Vol. 40, No. 2, April 1959, pp. 54-61.

N.E.D.C., op. cit., pp. 15-16.

See, U.S. Department of Commerce , Historical Statistics of the United States: Colonial Times to 1957 , Washington, D.C., 1960, Series C. 73, p. 45; idem., Statistical Abstract of the United States 1963, Washington, D.C., 1963, tables 7 and 475, pp. 10 and 357, and, G.H. Hildebrand and A. Mace , 'The Employment Multiplier in an Expanding Industrial Market, Los Angeles County, 1940-1947', Review of Economics and Statistics, Vol. 32, No. 3, August 1950, p. 241.

W. G. Hoffman in Brinley Thomas (ed.), Economics of International Migration , Proceedings of a Conference held by the International Economic Association in 1955, 1958, pp. 429-30. On the more general subject of the relationship between immigration and inflation, see A.P. Lerner , 'Immigration, Capital Formation and Inflationary Pressure', ibid., pp. 52-62, and P.H. Karmel , 'The Economic Effects of Immigration', in Australian Institute of Political Science, Australia and the Migrant, Sydney, Australia, 1953, pp. 82-103. On the burden of defence costs in Germany and elsewhere see, D.C. Paige , 'Defence Expenditure', National Institute Economic Review, No. 10, July 1960, Chart 1 and Table 3, pp. 29 and 31.

Central Statistical Office , National Income and Expenditure 1963, H.M.S.O. , 1963, Table 16, p. 16 and Ministry of Labour, Statistics on Incomes, Prices, Employment and Production, No. 8, March 1964, Table E4, p. 88.

In 1954 the ratio of fixed assets plus stocks but excluding the value of land to value added in U.K. manufacturing was estimated to be 2.8: I, T. Barna , 'The Replacement Cost of Fixed Assets in British Manufacturing Industry in 1955', Journal of the Royal Statistical Society, Series A (General), Vol. 120, Pt. 1, 1957, Table 5, p. 24.

See, G.C. Archibald , op. cit., from which much of this argument is drawn.

The Northern Region , Wales, Scotland and Northern England. See N.E.D.C., op. cit., Table 1, p. 16 and p. 18.

See, G. Katona and J.N. Morgan , 'The Quantitative Study of Factors Determining Business Decisions', Quarterly Journal of Economics , Vol. 66, No. 1, February 1952, p. 75, and W.F. Luttrell , Factory Location and Industrial Movement, London , Vol. 1, pp. 39-53.

Luttrell, op. cit., Vol. 1, p. 299.

See, for instance, the studies quoted in W. Isard , Location and Space-Economy , Ch. 2, pp. 24-54, Cambridge, Mass., 1956 , and for a different emphasis, M.L. Greenhut , Plant Location in Theory and Practice, Chapel Hill, North Carolina, 1956, especially Ch. 12, pp. 273-91.

Luttrell, op. cit., Vol. 1, pp. 175-9 and 319-22.

Lord Lucas in a speech in the House of Lords, quoted in C. Hill , 'Some Aspects of Industrial Location', Journal of Industrial Economics, Vol. 5, No. 2, August 1954, p. 190.

Luttrell, op. cit., Vol. 1, p. 341.

Cf. R. Cox and C.S. Goodman , 'Marketing of Housebuilding Materials ', Journal of Marketing, Vol. 21, No. 1, July 1956, pp. 36-61.

Scottish Council (Development and Industry) , Report of a Committee of Inquiry into the Scottish Economy 1960-1961 (Chairman, J. N. Toothill), Edinburgh (November 1961), Table 17, p. 73.

ibid., p. 74.

See, Luttrell, op. cit., p. 58.

See, Greenhut, op. cit., pp. 173-7 and 210-47; Hill, op. cit.; Katona and Morgan, op. cit., and E. Mueller et al., Location Decisions and Industrial Mobility in Michigan 1961, Ann Arbour, Michigan 1961, pp. 13-19.

See, H.A. Simon , 'Theories of Decision-Making in Economics', American Economic Review, Vol. 49, No. 3, June 1959, pp. 253-83, especially sections 3 and 4, The Goals of Firms, and Conflict of Interest, pp. 262-7, and S.P. Hayes , 'Some Psychological Problems of Economics', Psychological Bulletin, Vol. 47, No. 4, July 1950 , pp. 289-330.

See, Douglas Jay, M.P. , Parliamentary Debates (Commons), Vol. 685, Col. 1012, 3rd December 1963.

Luttrell, op. cit., p. 76.

See, G. Picton , 'Notes on the Establishment of Branch Factories ', Journal of Industrial Economics, Vol. 1, No. 2, April 1953, pp. 126-31.

Luttrell, op. cit., p. 79.

See, T. Barna , Investment and Growth Policies in British Industrial Firms, Cambridge, 1962, pp. 25-30.

Luttrell, op. cit., p. 332.

For a brief discussion of Government policy and for an excellent survey of the regional problem in Britain, see, Mrs M.F.W. Hemming , 'The Regional Problem', National Institute Economic Review, No. 25, August 1963, pp. 40-57. A more detailed account is given in J-L. Fyot and J-Y. Calvez , Politique Economique Régionale en Grande-Bretagne, Paris , 1956; Scotland's industrial problems are discussed in Ch. 7, pp. 195-207. J. Sykes , 'Some Results of Distribution of Industry Policy', Manchester School of Economic and Social Studies , Vol. 23, No. 1, January 1955, pp. 1-21, examines official policy in the period 1945-54. The 1958 Act is discussed in, A.J. Odber , 'Local Employment and the 1958 Act', Scottish Journal of Political Economy, Vol. 6, No. 3, November 1959, pp. 211-28, and the 1960 Act in, Seventh Report from the Estimates Committee, Session 1962-63, Administration of the Local Employment Act, 1960, H. C. 229/1962-63, pp. 3-23.

Report of the Royal Commission on the Distribution of the Industrial Population, Cmd. 6153, 1940.

The North East: A Programme for Regional Development and Growth, Cmnd. 2206, November 1963.

Central Scotland: A Programme for Development and Growth, Cmnd. 2188, November 1963.

See, Lord Blakenham , Parliamentary Debates (Lords), Vol. 254, Col. 256, 18th December 1963.

The coefficient of variation was 5 per cent in 1948 and 6 per cent in 1959-60. The source of the 1948 earnings figures was P. Deane , 'Regional Variations in United Kingdom Incomes from Employment, 1948', Journal of the Royal Statistical Society, Series A (General), Vol. 116, Pt. 2, Table 1, p. 126. The 1959-60 figures were taken from 105th Report of the Inland Revenue for the Year Ended 3rst March 1962, Cmnd. 1906, H.M.S.O., January 1963, Tables 108-30, pp. 140-84.

The coefficient of variation was 49 per cent in 1952 and 44 per cent in 1962. The source of the original data was the Ministry of Labour Gazette.

North Western, Northern, Scotland and Wales.

Seventh Report from the Estimates Committee, op. cit., paragraphs 1227-36, 1301-12, pp. 203-4 and 210-12.

ibid., paragraph 19, p. ix.

ibid., paragraphs 175 and 337-40, pp. 41-2 and 62.

See, G. C. Archibald, op. cit.

Seventh Report from the Estimates Committee, op. cit., paragraph 5, p. 2.

ibid., Table VI, p. 165.

Toothill Report, op. cit., p. 30.

Seventh Report from the Estimates Committee, op. cit., Table VI, p. 165.

Central Scotland, Cmnd. 2188, op. cit., paragraphs 38-42, p. 12. An even greater increase in additional employment is recommended by G. McRobie , 'A Development Plan for Scotland' (Political and Economic Planning) , Planning, Vol. 29, No. 476, 14th October 1963, p.411.

The North East, Cmnd, 2206, op. cit., paragraphs 22-27, pp. 12-13.

Seventh Report from the Estimates Committee, op. cit., p. 47.

ibid., paragraph 1481, p. 236.

ibid., paragraph 16, p. ix.

N.E.D.C., Conditions Favourable to Faster Growth, H.M.S.O., 1963, p. 18.

ibid., Table 1, p. 16 and p. 18.

See 'The Incidence of Taxes and Social Service Benefits in 1961 and 1962', Economic Trends, No. 124, February 1964, p. iv and Table 2, p. x. Income excludes family allowances, pensions and other grants from public authorities but includes employers' contributions to national insurance and national health services.

ibid., Table 4, p. xiv.

Seventh Report from the Estimates Committee, op. cit., paragraph 181, p. 42.

M. MacLennan , 'French Planning: Some Lessons for Britain' (Political and Economic Planning), Planning, Vol. 29, No. 475, 9th September 1963, Table 9, p. 369.

D.R. Gilmore , Developing the 'Little Economies', Committee for Economic Development, Supplementary Paper No. 10, New York, 1960, p. 18.

See, A.K. Cairncross and R.L. Meier , 'New Industries and Economic Development in Scotland', Three Banks Review, Vol. 14, June 1952, p. 20.