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Published byGilbert Nash Modified over 9 years ago
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Many theories how to spark economic development. Generally among the following; Market planning or Central planning Agglomeration or Dispersion Import Substitution or Export Promotion Basic Needs or Megaproject Increased industrialization may change strategies based on domestic and international conditions. Many mix strategies in development.
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Market Planning and Central Planning Use a market system, a centrally planned system, or some combination of the two.
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Market Planning Manufacturers decide what and how much to produce, and where to sell it according to market (consumer) demand. Cost of production, demand for goods and, consumer willingness and ability to pay determine cost and level of production (invisible hand).
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Central Planning Manufacturers told what and how much to produce and where to sell by a government planning board which allocates budget. Government decisions are based on capabilities and needs of national economy.
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Few countries are using a wholly centrally planned economy. However, many use a combination of market and central planning. The mix is designed to protect the interests of the nation in the running of the economy.
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http://www.taktikadesign.com/blog/tag/energy/ http://www.wayoftherail.com/2009/03/19/via- rail/via-rail-upgrades-track-station-near-ottawa/ http://logodesignconsultant.com/blog/government-agency-logos/
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http://www.cambridge.org/aus/c atalogue/catalogue.asp?isbn=978 0521805247 http://infranetlab.org/blog/2010/05/border- economies-the-maquiladora-export- landscape/ http://www.uwec.edu/geography/Ivogeler/w188/border/maquil.htm Agglomeration and Dispersion
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Agglomeration Industries are encouraged to locate near one another. Infrastructure costs minimized, labour is gathered together, and investment easily attracted. Economies of scale, rapid growth in some areas. Rapid urbanization occurs. Growth may cause overcrowding, pollution, high prices, declining quality of life. Eventually problems outweigh benefits and dispersion becomes favoured.
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Dispersion Spread industrial development throughout the non- core areas. Requires equal distribution of infrastructure services, transportation, education and others which slows progress. Allows the periphery to compete in providing jobs and raising living standards, limits flow of migrants to cities.
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Import Substitution and Export Promotion http://www.whatsonxiamen.com/news14782.html http://ecosquared.wordpress.com/2011/01/30/the-war-on-work-part-2/
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Import Substitution Replace imported goods with local products. 1 st targets low technology products since labour and raw materials are inexpensive and product is inexpensive. Textiles, clothing, footwear, processed foods, furniture and household goods. These become the basis for further growth as population learns labour and management skills, and entrepreneurship. Trade barriers protect from foreign competition, make local product more attractive, but…to much protection discourages growth since little incentive to improve product or manufacturing techniques.
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Export Promotion Encourages goods for international sale. World Bank reports that export promotion generally fares better in industrial growth. Risks since exports vulnerable to international markets. A growing US buys goods from abroad. During recession it buys fewer goods. The economy tied to the state of the American and other foreign economies.
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Basic Needs and Megaprojects http://www.britannica.com/EBchecked/media/106363/Itaipu-Dam-on-the-Parana-River-at-the-border-of
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Basic Needs Industries serve local population creating jobs, housing, clothing, domestic products. Usually mixed development strategies. Local population receives training basic to their existence. Creates a productive, independent, literate, and employed population, requires long-term commitment
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Megaprojects Hydro-electricity dams, railway construction, international airports etc… Benefits in infrastructure as the project meets national need. Require a large population, and some less populated countries now own underused facilities. Jobs often only for small group and income distribution becomes more unbalanced.
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