Regional Policy: Interventionism or Liberalization?
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Publication date: 2014-12-31
GNPJE 2014;274(6):5-29
The paper aims to establish whether and to what extent the recommendations of classical and Keynesian economics can be used in regional policy making. The author attempts to resolve the dilemma as to whether regional policy should take the form of a traditional policy of equalization, which would mean limiting support to only the poorest regions, or whether it should be oriented toward supporting richer areas. Pastuszka analyzes the literature on the subject and reviews research reports on the mechanisms of the socioeconomic development of regions. The analysis shows that there should be a reasonable balance between the impact of liberalism and interventionism in regional policy making, the author notes. The key recommendation that comes from such an approach to regional policy is that a polycentric model of moderate concentration should be promoted, Pastuszka says. The essence of this model is to strengthen medium­‑sized and small cities and build a functional communication network between them and between these cities and surrounding areas. When strengthened economically, these areas (surrounding cities), being the natural hinterland of large conurbations, can become their equal partners, and at the same time offer an additional incentive for regional development, the author argues. Therefore measures financed with public funds should be aimed to launch, supplement and strengthen the internal potential of individual subregions, according to Pastuszka. The top priority of regional policy interventions should be to fund activities aimed at facilitating the establishment and operation of local enterprises of key importance to the internal potential of subregions. Another priority is to strengthen the network of formal and informal links between these enterprises and scientific research institutions, consulting and training centers as well as public administration, the author concludes.
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