(2025-02-19) Davies Ramsays Regional Policy Nightmares

ramsay's regional policy nightmares (slight return). I find myself once more thinking about my regular bugbears in economic geography, and particularly about “scatterplot agglomerationism”, the belief that the single factor which accounts for economic productivity is either size, population density or some gerrymandered version of adjusted population density which takes into account transport times. (2024-09-20-DaviesMeVersusTheScatterplots)

subtitle but reykjavik! but dallas! but tilbury

my view is that the scatterplots tend to reverse the direction of causation (or at very least, underestimate the extent to which things are endogenous). If something grows it will get bigger, productive industries like to cluster together

The opposite view is what I’ve called “bastard Jane Jacobsism” – a sort of concept that density and agglomeration spontaneously generate economic activity, that the natural condition of human beings is to be starting businesses and they are only prevented by not being in close enough proximity to one another.

My alternative suggestion was summarised in a post last year – regional problems of underdevelopment are the result of specific bad decisions from the past, which can only be solved by making specific good decisions in the future. (2024-03-01-DaviesGordonRamsaysPolicyNightmares)

And that the TV series “Gordon Ramsay’s Kitchen Nightmares”, as well as acting as an excellent summary of Malcom Sparrow’s “Problem-Centric Regulation”, gives a model for how regional policy can be improved.

But revisiting that post a year on, I’m less convinced.

I might not have been starting from a point of respect for the problem. How did governance get so bad? Why has economic development not worked?

maybe I should have been joining this up to another recurring “bit” on this ‘stack. In 2023, I wrote, in a review of the book “The Big Con” by Mariana Mazzucato and Rosie Collington.

“[…] Like a doctor curing a patient, a consulting firm that did its job properly would make itself redundant. The temptation is instead to act as a corporate Dr. Feelgood, prescribing solutions that ease clients’ pain in the short term while sapping their independence and health in the long term. Mazzucato and Collington call this phenomenon “infantilization” where Stafford Beer called it “decerebration”

Having invited the consultants in out of a belief that the private sector can handle complicated things like technology and economic studies better, the public sector eventually succumbs to the consultants’ upselling of projects that encroach further on government’s core functions. This sets up a chain of events ensuring that the client’s own competence gradually declines.

This is an interesting description of the relationship between central government and management consultancy. But it’s an absolutely frightening description of the relationship between central government and local government.

That doesn’t mean the individual people are any worse than civil servants in Whitehall, far from it! It just means that when they know what needs to be done, they have no organisational means of doing it. And by degrading the organisational capacity, the original decision to centralise is justified.