Spatial diversification of industries

This book attempts an examination of the traditional postulates regarding location and spatial dispersal of industries and an assessment of some of the current policy instruments aimed at influencing industrial location in favour of backward areas. Based on detailed analysis of the secondary data as well as information collected from a large sample of industrial units, it provides a sound empirical base for drawing conclusions on the validity of the received theories of industrial location and efficacy of schemes of incentives and subsidies for industrial dispersal. Though the analysis has been carried out in relation to the locational behaviour of industrial units in Uttar Pradesh in the recent past, the questions sought to be answered, mode of analysis and conclusions are of general validity.

Findings of the study are revealing and significant both from theoretical and policy viewpoints. On the theoretical plane they go to question the usefulness of the simplistic, material and market based formulations in the explanation of locational behaviour and point towards the emergence of infrastructure, agglomeration and entre preneurs' non-economic preferences as factors of greater importance. On policy instruments, the study comes conclusion that concessions and incentives, to the even if better administered than at present, would be only marginally effective in offsetting the locational disadvantages of the backward areas. The study, therefore, suggests an approach based on "planning" of industrial development of backward areas, rather than a pure "assistance" and "subsidy" approach as has been adopted in the past, Given its analytical mode and topicality of the subject, the book is expected to be of direct interest and use to both students of industrial economics and policy-makers.