A conceptual framework is presented that clarifies issues involved in the rural policy debate. A new economic regionalism is emerging in which rural areas develop only as integral parts of larger regional economies. Advances in technology and new forms of economic competition that transcend both industrial and national boundaries have created a new regional dimension to the development process. The economic hardships and future opportunities of rural areas are better understood as the focus moves from rural economic development to the new regional development framework.
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References
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1. Many of the lessons learned and the new directions currently being taken were discussed at the June 1992 symposium sponsored by the General Accounting Office. See U.S., General Accounting Office, Rural Development: Rural America Faces Many Challenges, GAO/RCED-93-35, Nov. 1992.
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G. Rey , “Small Firms: A Profile of Their Evolution, 1981-1985,” in Small Firms and Industrial Districts in Italy, ed. E. Goodman (London: Routledge, 1989).
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3. As the old development paradigm becomes outmoded and loses its explanatory power, its concepts appear detached and arbitrary. Also, as real-world economic development acquires the new regional dynamic, the old paradigm tends to generate anomalies. When exceptions appear to outweigh the rule, analytical efforts are frustrated and ignored. For the seminal description of the nature of paradigm shifts, see Thomas S. Kuhn, The Structure of Scientific Revolutions (Chicago: University of Chicago Press, 1970).
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4. Enclave economies, as they have been defined in the economic development literature, are based on production operations of, typically, branch plants with few local backward or forward linkages.
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5. The measurement and monitoring of this economic restructuring is frustrated by the need to introduce new industry, product, and occupational categories. Evidence can perhaps be seen in the mounting difficulty in fitting the new activities into existing categories. But because reclassification is not performed regularly, the trends are not visible.
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6. Cf. the unbundling of service and other noncore activities by large manufacturing firms. This applies to low-tech services as well as high-tech.
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7. “Supra-” is used rather than “trans-” to emphasize the characteristic of transcending rather than merely crossing boundaries.
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See also Quarterly Journal of Economics (1976).
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9. Ceramics Corridor in Corning, NY, for example, is based on ceramics and electronics packaging activities; Medical Alley in Minneapolis-St. Paul makes medical instruments and health care products; Boomtown Boise, in Idaho, specializes in semiconductor chips and laser printers; and Laser Lane in Orlando, FL, and Optics Valley in Tucson, AZ, are hosts to the laser and electro-optics industries. Business Week (19 Oct. 1992) identifies 15 such “hot spots.”
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10. One of the many examples of this in the literature is Michael Best, The New Competition: Institutions of Industrial Restructuring (Cambridge: Polity Press, 1990). A profile of the small-scale flexible manufacturing networks in the Third Italy leads Best to develop a relatively static view of the new competitive dynamics. Best sees small flexible manufacturers as better adapted to the new forms of competition and therefore predicts continued downsizing. For a critical review of his book and citations of empirical evidence contradicting his generalizations, see the review by Kathy O'Donnell in International Review of Applied Economics, 7(1) 1993.
