Regional Growth and Regional Policy Within the Framework of European Integration

When Karin Peschel approached me to ask if I would provide a talk on the development of regional science in Germany to mark the “silver anniversary” of the Institute of Regional Research here in Kiel, I accepted quite spontaneously and gladly. And I will make no secret of the fact that I consider myself honoured to have been asked. For although I was the founder of the institute two-and-a-half decades ago, in reality I had to renounce its directorship quite soon afterwards (1976), when I moved from the Baltic to take up an appointment in the Federal Chancellery in Bonn (1970 – 1973) and later the Federal Ministry of Education and Science, subsequently moving to Düsseldorf (1978) to head the North-Rhine Westphalian Science and Economics Ministries (till 1990).

Soon after the IfR was founded, Karin Peschel in 1973 initiated a research programme aiming at analyzing the spatial impact of economic integration. As usual, at the beginning of this research project stood a screening of existing theories. Peschel presented the results from her first screening to the European RSA congress in summer 1974. They were published as no. 10 in the institute’s discussion paper series (Peschel 1974).

There has recently been increasing interest in regional economics. Indeed Blanchard (1991) goes so far as to claim that “macroeconomists have rediscovered regional economics”. Krugman has coined the phrase “the new economic geography” (Krugman, 1991). One recent manifestation of this interest has been the lively debate about ‘convergence’ and ‘divergence’ in growth rates (Baumol, 1986; Barro, 1991; Barro and Sala-i-Martin, 1991; Barro and Sala-i-Martin, 1992; Salai-Martin, 1994). To regional economists this is not a new debate. It can be traced back at least to Borts and Stein (1964) and the debate between the followers of Myrdal (1957) and Kaldor (1970) and the neo-classical school. This debate was summarised by Richardson (1973), and more recently by McCombie (1989a and b), and has formed a staple of most regional economics courses ever since (see, for example, Armstrong and Taylor, 1993).

In the present paper** we describe the changes that have occurred in the structure of employment by branch in the regional system of the EU over the period 1950 – 1990. We have distinguished four ten-year subperiods. Moreover, for some elements of the analysis we give a forecast for the year 2000. So we span half a century.

It is the purpose of this discussion paper to make a small contribution to the ongoing debate on the future of the regional level in the decision making process of the European Union.

Regional policy, both at the EU and at the national level, is confronting serious challenges, which may question even its existence in the medium and long term.

The paper deals with the economic development in different parts of Denmark -so far a welfare state with ever falling inequalities.

During the last decade there has been a resurgence of interest in private financing and increased mobilisation of private capital for transport infrastructure. One reason is fiscal pressure because of a shortage of public funds. Other reasons are the improvement of efficiency of construction and operation, the appropriate treatment of risk and the market conforming allocation of the total costs associated with the project.