"The Economist": the right way to help backward areas | Economist | regional economy | populism

    Choppy wave of populism。
This is a cool lesson recent election results in Germany and Austria, the two anti-immigration, globalization victory against the party obtained indicate hostility to the elite and foreigners unprecedented strong resonance in the population dissatisfied with the status quo in。 This is also the lesson of the US presidential election, US presidential election he came to bet on Trump vigorously angry attitude of the people, has recently made more likely to undermine rather than rescheduling the trade agreement negotiation stance toward the North American Free Trade Agreement (NAFTA)。
  These remedies will not work。 The end of the North American Free Trade Agreement for blue-collar workers support much greater harm Trump。 Tough on immigration help to improve the economic situation in eastern Germany, in the region of 20% of voters supported far-right parties AlternativeforGermany。
But self-deception populist policy does not prevent their attractiveness。 Mainstream parties have to find a better vision of the future was thrown under the promise of voters, more dissatisfied consider the geographical realities of the political factors behind。   Economic theory suggests that, with the poorer (and less costly) regions to attract investment and economic growth faster than richer regions, regional disparities will narrow。
20th century proved this theory: the Americas and Europe has narrowed the income gap。 Economic geography gap will have significant consequences。 Born in Los Angeles possibility affluent 20% of the lowest income strata among children up to 20% income bracket grew up in Detroit is twice the child of a similar class。 Born in London Chelsea area of child life expectancy Bibulaike Pu-born children grow nearly nine years。
Those living in disadvantaged areas of limited opportunities, but also macroeconomic damage。
If the past 50 years all US citizens living in areas of high productivity, its economic growth rate twice as fast as possible。   This difference is caused by a variety of great strength。 In the modern economy, the scale of increasingly important。
The company has the largest data can exercise their most efficient machines, other people are above the social network are most attractive to new users, most investors in the stock market is most suitable for investment。 These returns to scale caused by a smaller number of superstars gathered at the company less super regional。
Other areas have been left behind。   Despite the expansion of regional differences, people's mobility is getting low。 Since the 1990s, the proportion of Americans each year interstate flow has decreased by half。
Ordinary Americans are more subject to geographical restrictions than the average European, but live in a range of less than 30 kilometers away from parents。
Demographic trends change helps to explain this situation, including the need for the rise of dual-career families and care for their elderly family members。 But bigger reason is poor policy。
Thriving city of soaring house prices will shut out newcomers。 In Europe, the lack of affordable housing apartment leads people to rely on cheap。 In the United States, state specific occupational licensing practices and government benefits is not conducive to the expansion of those migrants。 Always stay in the teacher pension after retirement with a state likely than mid-career move twice as many teachers Dakota。   Help poor policies have actually inadvertently exacerbate the plight of backward areas。
Unemployment benefits and health insurance benefits so that people looking for work the hardest to survive in difficult areas, then they would have no other way except move。 Welfare system makes capitalism for the individual is not cruel, but exacerbated the problem of capitalist society。
  How to do?One way is to help people migrate。
Prosperity of the region can do more to build housing and infrastructure to accommodate new。 Accelerate a variety of qualifications across state or international mutual recognition help drive people to move to areas with the highest productivity of their。
However, the increasing mobility also has a side effect, the brain drain problem areas and exacerbate the problem in these areas。
With the high-productivity workers left, the local tax base damage, and even welfare and pensions burden rises。
  To avoid these situations, politicians have long tried to boost the economy in backward regions with subsidies。 But this is at best patchy regional policy。 Mid-1992 South Carolina State attract BMW settled on this basis, to build a thriving auto industry gathering place。
But only if the funding continues, the EU's structural funds will increase production and reduce unemployment。
South Carolina 42 existing corporate park, but none enhance the employability。
Politicians pay attention to speed up the best technical and commercial activities of the outstanding performance of the diffusion region。 Strengthen competition policy to reduce industry concentration, industry concentration undermine the economic viability, but less focus on growth areas of the company and to grow。
There may help by encouraging the creation of private investment funds for a specific region of enhanced concentration。
  Bolder initiatives will continue to expand the mission of the local colleges and universities。
The United States in the 19th century created a large number of public-technical colleges and universities to industry plant managers professor farmers and small towns in rural areas of best practice。
Today these universities can play this role again for the new technology, just as Germany has widespread application as university research network。 Even politicians, the location of company headquarters to identify the second causing many want to learn to settle their cities compete to attract。 Government modeled after the US National Institutes of Health (NationalInstitutesofHealth) or the European Organization for Nuclear Research (ropeanOrganizationforNuclearReseach, CERN) mode, the public research centers on policy reforms and public investment programs doing the best city。
This will help diffuse new ideas for difficult areas to provide incentives buffet。   Perhaps most importantly, the need to change the thinking of politicians。
For the Progressives, the poor need to provide benefits for liberals is an open economy。 Both focus on people。 But demographic trends, the complex effects of globalization and the mutual benefits between the means to do so is not enough。
Ease the anger of the people of backward areas should be recognized that these areas are also important。
(Lemon Nan / compiler)。

About