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Rural firms, farms and the local economy - a focus on small and medium-sized towns

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  • Paul Courtney

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  • Denis Lépicier

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  • Bertrand Schmitt

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    Abstract

    Small and medium-sized towns have traditionally formed an integral part of the agricultural sector and wider rural economy, acting as a source of farm inputs, a first destination of farm outputs and as a source of consumer goods and services to farm households. In recent years, this relationship has been substantially eroded through processes socio-economic restructuring, including the transformation of agriculture and a decline in other primary industries. Further, a number of endogenous and exogenous drivers have resulted in the uneven development of rural economies throughout Europe, leading not only to disparities but also to decline of small and medium sized towns as thriving economic and service centres. As a result, these settlements have received increasing attention from policy makers aiming to both maintain the traditional socio-economic fabric of rural areas, and to stimulate rural development through territorial, as opposed to sectoral – and namely agricultural – approaches. This paper considers these two issues through an analysis of local economic linkages in and around small and medium-sized towns. Using primary data collected in a study of thirty towns across five European countries, the paper examines the degree to which local firms and farms are integrated into the local economies of such towns relative to other sectors, and identifies the organisational characteristics associated with strong and weak local integration. The implications of the findings are discussed in the context of evolving European rural development policy.

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    Bibliographic Info

    Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa05p128.

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    Date of creation: Aug 2005
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    Handle: RePEc:wiw:wiwrsa:ersa05p128

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    1. Hanson, G.H., 1999. "`Market Potential, Increasing Returns, and Geographic Concentration," Working Papers 439, Research Seminar in International Economics, University of Michigan.
    2. Lisa A. Cameron & Mary Amiti, 2004. "Economic Geography and Wages," Econometric Society 2004 Australasian Meetings 253, Econometric Society.
    3. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476.
    4. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June.
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    7. Paul Courtney, Andrew Errington, 2000. "The Role of Small Towns in the Local Economy and Some Implications for Development Policy," Local Economy, Taylor and Francis Journals, vol. 15(4), pages 280-301, November.
    8. Giuseppe De Arcangelis & Giordano Mion, 2002. "Spatial Externalities and Empirical Analysis: The case of Italy," series 0006, Dipartimento di Scienze Economiche e Metodi Matematici - Università di Bari, revised Jan 2002.
    9. Fujita, Masahisa & Mori, Tomoya & Henderson, J. Vernon & Kanemoto, Yoshitsugu, 2004. "Spatial distribution of economic activities in Japan and China," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 65, pages 2911-2977 Elsevier.
    10. MION, Giordano, 2004. "Input-output linkages, proximity to final demand and the location of manufacturing industries," CORE Discussion Papers 2004053, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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