Evaluating British Government Regional Policy: A Cost Oriented Approach

Abstract

Many attempts to model industrial movement have lacked an explicit theoretical base. In this paper, data on interregional movement is modelled on the presumption that least-cost theory is relevant to the decision to locate. This notion is combined with random utility theory and the resulting model provides estimates of the impact of government policy on the flow of mobile industry in the 1960s and 1970s. The empirical results that this provides support the findings of some previous workers who suggest that urban and regional policy was effective well into the 1970s; the models employed in the present paper provide evidence that the impact of policy was differentiated according to region, with industrial movement to Wales being the least affected by the reduction in the strength of policy instruments.