Regional Analysis and Policy Making

Regional Analysis and Policy Making

by Yudo Anggoro, University of North Carolina at Charlotte

According to Higgens and Savoie (1995), regional analysis is a combination of several contributing disciplines; notably are economics, geography, and political science; and to a lesser degree are sociology, anthropology, and physical science such as geology and climatology. Regional analysis is a useful tool for policy making process because in the process of designing policy to assure good performance of national economies, or other policies, requires thorough understanding of the behavior of the regional economies of which they are composed, and formulating policies for each region on the basis of that understanding. Designing policy for such purpose requires making regions (spaces) basic unit of analysis, studying the societies of each space on the spot, determining the actors, and building explanatory models based on those observations.

According to Higgens and Savoie (1995), social sciences, particularly economics, can be more effective instruments for discovery of truth and acquisition of new knowledge, and thus for solution of current and social problems, if major emphasis is laid on analysis at the regional and community level, rather than putting the emphasis on analysis at the macro level and at the micro level of the industries, firms, households, and local governments. In this sense, societies and economies cannot be well understood without analyzing the interactions, feedbacks and overlaps among spaces, structures, and societies; and this is why regional analysis matters. Regional analysis is also important because countries, nations, nation states, and national economics are collections of spaces, each with its own society and its own economic, social, political, and power structure.

Even though other disciplines also make analysis based on space and region, there are some differences between regional analysis and other disciplines. Anthropologists conduct on-spot study of particular societies, which regional analysis also assesses. However, anthropologists do not focus on the physical environment with which the society of a particular space interacts, as well as making recommendations for changing the environment to improve the society (Higgens and Savoie, 1995).

On the other hand, Geographers tend to make error in the other direction; they are aware of the physical environment but they tend to under emphasize the social and cultural structure, including the political framework and administrative problems. Sociologists also enter into regional analysis in a comprehensive analysis, but rarely include economic factors such as market structure, distribution of monopoly power, impact of monetary, fiscal, and foreign trade policy. Political scientists, on the other hand, tend to pay little attention to economic and socio-cultural factors. While other disciplines have some limitations in their analysis, regional analysis has an advantage in adopting a multi-disciplinary approach, which is why it is uniquely placed to play a major role in combining together the various forms of social sciences into a comprehensive analysis.

In regard to economics discipline, Higgens and Savoie (1995) argue that mainstream economics never deal adequately with spatial analysis. This failure in addressing space comes from the fundamental principles such as to bring optimal allocation of resources; there is a basic harmony of interests among social groups, communities, regions, and nation-states, and the degree of actual mobility in the real world would be such that the assumption of complete, costless, and instantaneous would do no great violence to reality.

Higgens and Savoie (1995) also strongly argue that space, as in regional analysis, plays a more vital role in economies and societies than, say Marxist or neo-classical views. Among those strong roles are:

1. All societies live in particular places, as well as cultures are defined in terms of space.
2. Spaces are almost always smaller geographically than a nation-state. This will bring benefit in the further analysis.
3. In most countries, there are sharply conflicting interests among various societies occupying various spaces within them. However, there are more fundamental conflicts among societies/spaces in almost every country in the world.
4. Economics and social interests of particular societies in particular spaces are closely tied to the dominance of particular sectors of economic activity and the consequent structure of the economy and society. A commonality of interest arises only when people live and make their living in the same sector in the same place.
5. People develop strong loyalties and attachments to spaces. Many people have a passionate desire to go on living and earning their living where they are, and that desire is a factor that must be considered a proper weight in the calculation of the impact of any policy on the welfare of a particular society.
6. Most people do not think of “welfare” in terms of nation-states. Where social welfare is concerned, much smaller spaces than the nation-state must be used as the criterion.
7. There is a combination of market failure and government failure in the society that shows how the market does not work in ideal condition. Therefore, each problem in the society must be taken care where it exists.
8. There is a limited sense in which there is a harmony of interests in a national economy and national society.
9. These conflicts tend to be translated into spatial terms, because there is an overlap between technological dualism or pluralism and regional dualism or pluralism.
10. There is also an overlap between structural adjustment and regional development.
11. However, there are several strong complementary aspects between policies to develop particular regions and efficiency of the national economy. For example, countries with high per capita income tend to have small and diminishing regional disparities.
12. There is no evidence of a general movement toward equilibrium in a free market economy.

Another distinctive characteristic of regional analysis is that it is concerned with aspects of space which cannot be handled in other disciplines. Some of these aspects include the spatial multiplier, space and time concern, the relationship of space to the diffusion of knowledge and information, indivisibilities, and externalities, polarization and cumulative causation, and the overlap between spatial heterogeneity, occupational structures, socio-cultural differences, and political action and expression identified with defined spaces (Higgens and Savoie, 1995).

Reference

Higgens, B. and D. Savoie (1995) “Regional Development and Their Theories,” New Brunswick: Transactions Pub.