Myrdal's Cumulative Causation     


  This was a theory used to explain regional differences. A reverse flow of selective migration from rural to urban areas causes greater regional inequalities.

  • Successful growing areas attract more economic activity causing even greater disparity. This economic concentration in core areas is called backwash or polarisation. The core has a cumulative and growing advantage over the periphery. These areas can use economies of scale, better technology etc.
  • Some areas will have upward spirals and some will have downward spirals due to the multiplier effect.
  • Growth will slowly spread to periphery areas as the core needs resources and will inevitably get these resources from the periphery.
  • Land prices in the core rise and so some companies will decentralise to the periphery.

  The gap between core and periphery depends on the relative rates of backwash and spread. If backwash dominates there is an increasing gap; if spread dominates there is a decreasing gap.