Discussion Papers 1988.
Spatial Organization and Regional Development
54
Andrzej WROBEL
ECONOMIC GROWTH AND REGIONAL DEVELOPMENT;
THE CASE OF POLAND
The present paper deals with the question
of the dependence of the regional structure of the
economy on the character of economic growth, consi-
dered mainly with respect to structural change. The
links between the processes of structural change
of the economy and economic growth have been fully
recognized for a long time. The works of Colin Clark
and F. Perroux are probably the most outstanding
cases of the recognition of these links. Similarly,
in the main current of regional development studies
since the early 1960s, structural economic changes
have been recognized as both the source and outcome
of regional growth proceeses. Yet, the main focus
of attention has been on the region's economic
structure conceived as a set of interindustrial
linkages, and on the problems connected with the
transmission of growth impulses originating in the
dynamic sectors /propulsive industries/; less atten-
tion has been paid to the interregional growth diffe-
rentials arising as a consequence of the structural
change of the whole national economy.
It was within the framework of shift-share
analysis that gave expression to the idea that the
changes in the distribution of the whole complex
of economic activities /as measured by the total
employment or total output/ might be looked upon
as an outcome of two types of changes:
1/ changes in the spatial distribution of
individual sectors of the economy;
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
55
2/ changes in the structure of the national
economy, occufdng as a consequence of the inter-
sectoral differentiation of the rates of growth
ard affecting the interregional differertiation
of growth rates because of the fact that regions
have different sectoral structures /activity mix/.
In the framework of shift-share analysis,
this idea founC expression in the definition of
the total shift as the sum of differential shift
and structural /activity mix/ shift,
In the present paper, I do not interd to
enter into the critical discussion of various prob-
lems connected either with definition of concepts
or with the interpretation of results of this anal-
ysis. I shall operate with the simplest, "classical"
formula of the definitions of the component concepts
and will abstract from such problems as depedence
of the results on the definition of sectors, set-
ting the arbitrary time-intervals for calculations
that are affected by this decision, or other arbi-
trary measures inherent in the use of the method.
These special problems are irrelevant from the point
of view of the pupose of this paper. I will use the
concerts of shitf-share analysis as a frame cf ref-
ference for some reflections on the relations be-
tween structural changes of the economy and the
interregional differentiation of growth.
In the text of the paper, a positive total
shift for a region is treated as equivalent to e-
conomic growth and the "national economy" is conci-
eyed of as being synonymous with the "whole economy",
which is a ccnverient way of avoiding the question
of international economic interdependencies. The
differential shift is considered mainly from the
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
56
point of vieu of the "locational tendency": as used
here, the latter tern refers to one aspect orTy of
the locationEl behaviour of an economic sector;
namely, to the perspective of "ccncentration - de-
ccncertration" either with or without refererce to
the hierarchical structure of the spatial economic
organization. Similarly, the term "looational ten-
dency" is used in referance to the total shift. The
term "sector of economy" is used here, unless oth-
erwise specified, as equivalent to "economic acti-
vity" or industry"; while "dynamic sector" denotes
the sector characterized by higher. than average
rate of growth.
Determinants of structural shif t
The differertial and structural shifts dc
not represert some distinct type of forces and do
not constitute different, indepEndert movements
in space: the very definitions of these shifts are
not free from certain conventions. Indeed, changes
in the spatial distribution of individual sectors
of the economy are to a large extent caused by the
processes generating structural changes. Therefore,
considering the impact of structural changes re-
sulting in interregional shifts, we distinguish the
"direct impact", expressed by the structural shift,
and the indirect impact, more difficult to measure
and affecting the volume of differential shift.
Particularly, since individual sectors have various
locatioral tendencies, the direction of national
structural change, dependent on which sectors are
dynamic, determines also whether the positive
structural shifts are accompanied or not by positive
differential shifts. If dynamic sectors tend to grow
more rapidly in regions of existing concentration of
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
5 7
these sectors /i.e., regions where these sectors
define the specialization of their economy/, the
effect of structural change measured by positive
structural shift will be enlarged by the differen-
tial shift of the same sign.
In which type of situations are structural
shifts particularly high.?
In order to define the magnitute of the
structural shift for a region,let's denote
a. as the share of sector i in the total regi-
onal employment,
a. share of sector i in the total national
employment,
total regional employment,
national growth rate of sector. i in the
given period
national growth rate of total employment.
The definition of the structural shift for a region
is thus
S
ai E /0(i -O<T/
Let's assume that the national economy is composed
of only two sectors: the dynamic one /i/ and the
sector of remaining activities /j/, so that
c,<:
‹;
Then, the structural shift for the region equals 0,
as by definition in the closed set of regions
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
58
/"country"/, in the situation described by the
equation
ai E Aci -XT/ + aj E /(2.(j -CX:r/ = 0
When the regional share of the dynamic sector is
higher than its share in the national economy,
e., when
a. '7 a.
,
then
S 7 0
In that case, the positive structural effect for
the region is directly proportional to
1/ the value of the initial share of the
dynamic sector in the region as compared vith its
share in the country /ar
aN/
i / i/.
2/ the value of the difference between the
national rate of growth of the dynamic sector and
the average rate for the national economy ,i<1
In other words, the more dissimilar is the initial
spatial distribution of the dynamic sector as com-
pared with the remaining activities and the more
rapid is the change in the sectoral structure cf
the national economy, the higher is the structural
effect for the region.
Let's now take into consideration a sequence
of periods for which the interregional shifts in
the spatial distribution of the economy of the coun-
try are calculated. In case of the continuation of
previous locational tendencies of sectors aE well as
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
5 9
differences in their relative growth rates, both
the differential and structural shifts are iden-
tical as to sign and location. If for a given
region or set of regions both the differential
and structural shifts have the same sign, so i6
the case with the total shift, which means the
continuation of previous general locational ten-
dency expressed by the total shift.
The change of this general locetional ten-
dency in relation to the previous period may occur,
however, in case of changes in the relative diffe-
rerces of growth rates of sectors, resulting in the
emergence of new dynamic sectors. Whether or not
the general locational tendency changes in this sit-
uation deperds on: a/whether the new dynamic sec-,
tors have a different spatial distribution in rela-
tion to the old ores; and t/ whether they have dif-
ferent locationEl tendencies in relation to the spa-
tial organization of the economy.
Reletive_inwortance of_structural chanLes_es_a
factor of interreflonal differentiation of_frouth
The above considerations permj_t certair
stages of economic growth to be distinguisted in
which the impact of the changing structure of the
national economy on the spEtial growth patterns
tends to be particularly marked. The first of these
is the stage cf tranf-ition from preCominartly agri-
cultural economy to an industrial one. Wher the
economy of a country is urCergoing such a trans-
formation in a short time, high structural shifts
are likely to occur. in its regions since both de-
terminants of the intensity of these shifts are
present: the initial regional distribution of in-
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
60
dustry is, as a rule, unever; ard the rate of in-
dustrial employment grcwth exceeds distinctly the
rate for total employmert /while the rate of agri-
cultural employmert growtE is in most cases nega.,
tive/. The intensity of the resulting structural
shifts may be, however, highly differentiated among
countries deperding on the relative values of the
growth rates for individual sectors as well as for
total emploment, in the respective economies.
The second type of situation characterized
by a strong impact of structural economic charges
on regiOnal development arises in economically
advanced countries in the period cf the "shift to
sevice ecomony", which - accrding to one of the
students of the pioblem
"is bringing about a
furdemertal restructuring of both labor markets and
the ecoromic geography of the courtry" /Noyelle,
1985, p. 241/. Again, locational tendencies of ser-
vices are not identical with those cf industry, and
while the employment growth rates in this stage are
generally lower, there still exists a marked diffe-
rence between employment growth rates in services
and those in other sectors. On the other hand, the
character of structural shift is here differert in
its geographical characteristics as compared with
the stage of rapid industrialization, since it is
most marked in the perspective of hierarchical
strata /ranks/ of the urban system. Thus, the likely
effect of this type of structural change is the new
tendency in the evolutior of the spatial organiza-
tion of the economy.
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
6 1
Polish experiences
Both typcs of spatial. changes resulting from
the changing structure of the national economy are
documented ty the studies on regional differentra-
tion of economic growth in Poland. In the earlier
studies of the present cuthor /Wrotel 1980, 1985/,
there were calculated, for the period 1950-1978,
the shifts that have occurred in Poland in the
economies of the voivodeships grouped into two
large areas: underdeveloped East and more develo-
ped West. According to these studies, the negative
structural effect of the high share of the agri-
cultural sector in the economy of the East was so
great that the total shift of economically active
population for this area was highly negative, equal
to about 740.000 persons, i.e., almost twice the
volume of the positive shift of nonagricultural em-
ployment totalling 180.00C and resulting in the
greatest part from the industial location policy
favouring the underdeveloped areas. This negative
shift in total employment had its counterpart in
the negative shift of population, which amounted
to about 1.2 million.
As may be seen by comparing the relevant
figures presented above, the effect of locational
policies did not offset entirely the structurally
determined tendency towards greater concentration,
of population in the more developed regions; howev-
er, it succeeded in curbing this tendency and di-
minished the interregional income differences /see
WrObel 1980/, and thus furthered to a considerable
degree the "regional balance" in the process of e-
conomic growth.
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
62
Thus far, I have compared the results of
regionally directed development policies with the
direct consequences of structural changes in the
national economy. The indirect impact of these
changes, however, also must be taken into account.
A contention of my paper is that this indirect im-
pact was a very significant factor of success of
regional. development policies. In other words, the
above described "regionally balanced" growth in
Poland was achieved in specific conditions related
to the structural characteristics of growth proces-
ses that, in turn, were shaped by specific economic
policies.
First of all, it must be pointed out that
the structurally determined tendencies towards
further ccncentration of economic development in
Poland were not very strong, in contrast to the
intensity of the processes occurring. in most Euro-
pean countries. To demonstrate this, I will change
the level of spatial aggregation from the two macro-
regions to the whole set of provinces /49 since the
year 1975/. In this approach, I will. take the value
of interprovincial population shifts as a measure of
the intensity of the tendencies towards areal con-
centration /only positive values will be added,
since the total of positive and negative shift val-
ues is 0 by definition/. As a rejevant country of
comparison, I will take Spain: a country with a dif-
ferent social and economic system; but otherwise
comparable to Poland ir terms of area, population
number, and number of provinces /50/.
The sum of positive shifts for Spain in the
1960s - a period of rapid industrialization compa
rable in intensity to Polish - was equal to about
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
63
2.600.000 persons, while for Poland crly about
580.00C; that is, less than ore quarter of the
former value. By way of explanation, I draw your
attertion to the relatively low rate cf outflow
of labour from agriculture. The importance cf the
above variable is self evident, since it was the
high rate of decline of agricultural employment
combined with the high share cf agriculture in the
economy of less developed
regions that was de-
scribed earlier as the structural comperent of the
tendency towards. the concentration of economic
activities. Decline in agricultural employmert is
a variable related to other components of employ-
ment structure and growth, namely to the rates of
change of total employment and nonagricultural em-
ployment, as well as the ratio of nonagricultural
to agricultural employment at the beginning of the
period under corsideretion.
In the Polish cese, the yearly xate of de*
cline of agricultural employment in the 1960s /as
in the proceeding decade/ was very low: -0,8 %;
although the rate of growth of nonagricultural em-
ploymert wes high /3,5 %/. Yet, the high demand for.
labour outside agriculture was naturalized by the
very high rate of growth in the supply of labour
originating from: a/ high natural increase of popu-
lation in the preceeding years /postwar population
boom/: an b/ high, and growing, activity rate, i.e.,
the share of employed persons in the total popula-
tion /0.467, 0.503, and 0.514 in 1960, 1970, and
1978 respectively/. The latter factor, in turn,
besides its demographic determinants, was associated
with the type of economic development model adopted
/i.e., the model of extensive character, relating
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
64
the grouth of production mainly to growth of em-
ployment and massive investments, and, to a more
limited degree, to increases in productivity/.
The above refers to a large extent also to
the situation in the 1970s, although the determi-
nants of the interregional population shifts have
changed. The rates of growth both of total employ-
ment /now 0.8 anrually/ and nonagricultural em-
ployment /2,6; for industry alone nuch less/ di-
minished, while the share of agriculture in the
total employment was now lower; consequently, the
rate of decline of agricultural employment rose
considerably /-2,8/. The sum of interprovincial
population shifts has therefore risen, but was
still much lower in comparison to the Western
European countries in the similar stage of struc-
tural transformation.
The second group of "specific conditions"
related to structural characteristics of economic
growth processes that helped to achieve the "regi-
onally balanced" growth in Poland refers to the
relative role of industry in economic development
of the country, as well as to its employment growth
rate as compared with the service sector. The rate
of industrial employment growth in Poland was very
high /see Table 1/ due to the model of extensive-
type development mentioned above. Thus, the share
of industrial employment increase in the increase
of the total volume of nonagricultural employment
in Poland was equal almost to one half /46%/ in
the 1960s, and the 1970s it was still equal to one
third /34%/.
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
65
The above figures help us to understand why
the regional distribution of additional industrial
employment in Poland determined to a high degree
the distribution of the increments of tertiary em-
ployment /the same is true also of the distribu-
tion of investments in the two sectors/. In other
words, the industrial location policy, favouring
the less developed regions, was determining at the
same time to a large extent the regional shifts of
the total volume of nonagricultural employment.
Although this dependence of urban growth on
industrial development was most marked in the early
period of post-war industrialization, it was still
important in the 1970s, when the rate of industrial
employment as well as its share in total employment
diminished. This fact is illustrated by the 1970
- 78 data in Table 2, in which all the provinces of
the country have been grouped according to their
degree of urbanization in 1970. There may be seen
a tendency towards a more balanced growth of urban
population, the rates of which were inversely pro-
portional to the initial degree of urbanization.
The data demonstrate similtaneously how strongly such
a pattern of urban population growth was still con-
ditioned at that time by the intensity of industrial
employment growth, even more differentiated in fa-
vour of less urbanized regions. However, the more
urbanized the provinces, the less their total em-
ployment growth was dependent on industry.
Thus, it may be stated that one of the condi-
tions of the efficiency of regional development pol-
icy in terms of "balanced regional growth" was the
severe sectoral bias in the distribution of invest-
ment funds in favour of industry and general under-
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
66
development of services /as well as all types of
infrastructure/; a bias that over the years was
negatively conditioning the efficiency of the na-
tional economy and later constituted an element
aggravating the economic crisis of the late 1970s.
I would like to devote the last part of my
paper to the changes occurring during the time of
the crisis. The year of the last Polish Population
Census /1978/ may be considered as a terminous of
a certain era in post-war economic and regional
development. The subsequent years witnessed a far-
reaching economic and social crisis. For the first
time in Polish post-war economic history, there
appeared such phenomena as a decline in national
income figures, in industrial output, employment,
investments, etc. For the first time also the trends
of changes in the sectoral structure of employment
were reversed: the share of industrial employment
diminished and that of agricultura increased.
In these circumstances, regional development
policy lost its traditional tools and, indeed,
changed character. It became concerned mainly with
reducing the intensity of certain phenomena influ-
encing negatively the role of regions /particularly
environmental pollution/. It is, however, interest-
ing to note that the process of diminishing of in-
terregional inequalities was occurring even in the
conditions of absence of any policy deliberately
promoting it. This finds its explanation in the
fact that the most urbanized and most industrial-
ized provinces were hit most severely by recession.
It should be kept in mind, though, that in
the conditions of socialist economy, crisis or
recession is connected not with lack of demand but
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
67
with inadequate supply. The latter refers both to
consumptim goods and to production inputs.
The decline in the standard of living was
most acute in great cities and urban agglomera-
tions; this, taken together with employment decline,
resulted in diminishing to about one half the volume
of interprovincial migrations as well as migrations
from villages to cities.
In the sphere of production and employment,
most vulnerable to the supply difficulties were
industries manufacturing final products and other
goods of high stages of elaboration: these were
mostly located in greater cities and industrial
agglomerations. Thus, while industry as a whole
experienced a marked employment decline, the latter
was highly differentiated in favour of less developed
provinces Abe least urbanized ones hardly experi-
enced any industrial employment decline; see Table
2, data for 1978 - 84/. Since changes in service
employment were similarly differentiaded to the
advantage of less urbanized provinces, the rates
of total employment change /negative for the na-
tional economy/ were again differentiated in favour
of these provinces, which even experienced a posi-
tive rate of growth for the "least urbanized" class.
Andrzej Wróbel : Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
68
References
NOYELLE, T. J. /1985/ The shift to services,
technological change, and the
restructuring of the system of
cities in the United States, in:
International economic restructuring
and the territorial community, UNIDO,
Vienna, p. 240-263.
WROBEL, A. /1980/ Industrialization as a factor of
regional development in Poland,
Geographia Polonica , vol. 4 3, P.
187-197.
WROBEL, A. /1985/ Structural changes of economy
and regional development inequalities,
Geographia Polonica , vol. 52, p.
147-152,
Table 1
Yearly rates of change of total employment and its
components /in %/
Sectors;
1960-70
1970-78
1978-84
Total Empl.
1.7
0.8
x/
Agriculture
- 0.8 '
- 2.8
x/
Nonagricultural
sectors
3.5
2.6
- 0.3
Industry
3.6
2.0
- 1.4
Othes sectors
3.3
3.0
0.5
x/ no comparable data available
Andrzej Wróbel •
•
: Economic Growth and Regional Development ; The Case of Poland
Discussion Papers 1988. Spatial Organization and Regional Development 54-69. p.
6 9
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