The demand for industrial-development certificates and the effect of regional policy

Research output: Contribution to journalArticle

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Abstract

The demand for industrial development certificates and the effect of regional policy, Reg. Studies 23,301-314. Attempts to cstimate the effects of UK regional policy are frequently restricted by lack of data. However, this paper uses the statistics resulting from the policy of Industrial Development Certificate (ID C) control to construct a space-factor-demand model of the demand for industrial floorspace. The IDC data set is viewed as reflccting observations on successive stages of a factor-demand model and allowance is made for spatial substitution as well as the more usual factor substitution possibilities. The effects of different regional policy instruments are modelled including the transmission mechanism through which IDC policy exerts its effect on Development Areas (DAs). The results of estimation appear to provide considerable support for our hypotheses: applications for ID C and hence demands for floorspace in D As are found to increase as national output rises; individual incentives are shown to have induced factor substitution suggesting that incentives for industrial buildings and plant and machinery are not additive in their effect on factor demands; own-location factor substitution effects of incentives appear to dominate any spatial substitution effects that they may have generated directly; factor availabilities appear to have induced a predominant spatial substitution effect; and finally, ID C policy appears to have played a significant role in reducing the spatial isolation ofD As and enhancing the effectiveness ofthe financial incentives.
LanguageEnglish
Pages301-314
Number of pages13
JournalRegional Studies
Volume23
Issue number4
DOIs
Publication statusPublished - Aug 1989

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regional policy
industrial development
certification
substitution
demand
incentive
location factors
development area
development control
policy studies
effect
machinery
social isolation
building
statistics
lack

Keywords

  • industril development certificates
  • regional policy

Cite this

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title = "The demand for industrial-development certificates and the effect of regional policy",
abstract = "The demand for industrial development certificates and the effect of regional policy, Reg. Studies 23,301-314. Attempts to cstimate the effects of UK regional policy are frequently restricted by lack of data. However, this paper uses the statistics resulting from the policy of Industrial Development Certificate (ID C) control to construct a space-factor-demand model of the demand for industrial floorspace. The IDC data set is viewed as reflccting observations on successive stages of a factor-demand model and allowance is made for spatial substitution as well as the more usual factor substitution possibilities. The effects of different regional policy instruments are modelled including the transmission mechanism through which IDC policy exerts its effect on Development Areas (DAs). The results of estimation appear to provide considerable support for our hypotheses: applications for ID C and hence demands for floorspace in D As are found to increase as national output rises; individual incentives are shown to have induced factor substitution suggesting that incentives for industrial buildings and plant and machinery are not additive in their effect on factor demands; own-location factor substitution effects of incentives appear to dominate any spatial substitution effects that they may have generated directly; factor availabilities appear to have induced a predominant spatial substitution effect; and finally, ID C policy appears to have played a significant role in reducing the spatial isolation ofD As and enhancing the effectiveness ofthe financial incentives.",
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The demand for industrial-development certificates and the effect of regional policy. / Ashcroft, B.K.; McGregor, P.G.

In: Regional Studies, Vol. 23, No. 4, 08.1989, p. 301-314.

Research output: Contribution to journalArticle

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