the classic core periphery model myrdal friedmann l.
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The classic core-periphery model: Myrdal & Friedmann. Demands from center for goods/services yields payments to periphery. Abundant Labor. Supply of materials and products. Periphery. Center. Scarce Capital. Abundant Capital. Capital flows to periphery.

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the classic core periphery model myrdal friedmann
The classic core-periphery model: Myrdal & Friedmann

Demands from center for goods/services

yields payments to periphery

Abundant

Labor

Supply of materials and products

Periphery

Center

Scarce

Capital

Abundant

Capital

Capital flows to periphery

Shortage of labor in center creates

stimulus for labor migration from periphery

Scarce

Labor

Supply of labor from periphery will create labor

shortage in periphery and raise wages and incomes

Adequate

Labor

Adequate

Capital

backwash circuits
Backwash Circuits

Capital Investment

Migration and Employment

Capital

attracted

to center

Young workers

migrate

to center

Wider

Gap

C-P

Lack of

investment

in periphery

Aging

labor force

in periphery

Wider Gap

C-P

Retarded

growth in

periphery

Decreased

attraction for

new activity

Services and Infrastructure

Reduced Investment

and new jobs

in periphery

Smaller local

market, pur-

chasing power

Widened gap

between C-P

Decline in

local services

pred s model of circular and cumulative growth
Pred’s Model of Circular and Cumulative Growth

Enhanced chance

of invention

and innovation

Entry of new

industry or expansion

of existing industry

Initial

Multiplier

Effect

Attraction of

linked industries:

forward linkages

backward linkages

New

Construction

Activity

Expanded

Tertiary

Sector

Expanded

Public

Utilities

New local or

regional threshold

Secondary

multiplier effects

Invention or

Innovation

the economic base model
The Economic Base Model

ET = Total Employment

EX = Export Employment

EL = Local Employment

ET = EX + EL (1)

Define a = EL/ET

Multiply by ET and substitute into (1):

ET = EX + aET

Solve for ET:

ET = ( 1/1-a)EX

example economic base model
Example, Economic Base Model

If a = .67

Then:( 1/1-.67) =( 1/.33) = 3

If EX = 500, then ET = 3 x 500 or 1500.

If EX rises to 750, ET becomes 3 x 750 or 2250

and if EX falls back to 400, ET declines to 1200

regional input output models
Regional Input-Output Models

Final Demand

Total Sales = Total Purchases

Total Sales = Intermediate Sales + Final Sales

Total Purchases = Intermediate Purchases + Value Added

+ Imports