PRODUCER SERVICES AND REGIONAL DEVELOPMENT: A POLICY‐ORIENTED PERSPECTIVE

Abstract

ABSTRACT There is a certain optimism among policy makers concerning the ability of producer services, viewed as locationally flexible, to stimulate economic growth in lagging regions. Four issues related to the location of producer services are used to critically examine this notion: (1) observed centralization and decentralisation trends. (2) the influence of corporate ownership and control, (3) intrafirm functional separation, and (4) the impact of telecommunications technology. Producer service growth has not benefited central and peripheral regions equally. The empirical and conceptual evidence presented suggests that these activities have little positive impact upon lagging regions. Some essential elements of a regional strategy involving producer services are proposed.