Post on 17-Mar-2022
M A IV SEM (M U )Topic: circular cumulative causation by Gunnar Myrdal. ( 2 theory of regional
development )
By Dr. Bhawana NIGAM
Dept. of Geography
A N College, Patna.
Introduction.
• Circular cumulative causation is a theory developedby Swedish economist Gunnar Myrdal in the year1956.
• It is a multi-causal approach where the core variablesand their linkages are delineated.
• The idea behind it is that a change in one form of aninstitution will lead to successive changes in otherinstitutions.
• These changes are circular in that they continue in acycle,, in which there is no end, and cumulative inthat they persist in each round.
• The change does not occur all at once as that wouldlead to chaos, rather the changes occur gradually.
The discussion• Myrdal maintains that economic development
results in a circular causation process leading to rapid development of developed countries
• While the weaker countries tend to remain behind and poor .
• Myrdal believes that international and interregional economic relations in practice involve unequal exchanges in the sense that the weak is always exploited by the strong.
• He describes the backwash effects of migration, capital movement and trade in the backward regions
• THE MAIN CAUSE OF BACKWARDNESS AND REGIONAL DISPARITIES HAS BEEN THE STRONG BACKWASH EFFECT And WEAK SPREAD EFFECTS.
• Developed region is developing at a fasterrate at the cost of backward region.
• Income earned by developed region is notreinvested in backward regions
• But is relocated to the developedsectors/regions leading to moredevelopment in these areas.
• Spread effect continues to become strongerin developed countries
• While backward effect continued to becomeeven more spread in backward countries.
The nodal-hinterland relation.
• There was some spread effect from nodalregions to the hinterland.
• The hinterland supplies raw material, labour,etc. To the centres of development
• And in turn receive consumer goods andservices.
• However, these spread effects never helpedin self-expansion process in rural areas.
CUMULATIVE CAUSATION THEORY OF ECONOMIC DEVELOPMENT
• The cumulative causation action has beenbuilt upon spread effect and backwasheffects.
• The theory emphasizes that “poverty isfurther perpetuated by poverty” (bwe >spe) and “affluence is further promotedby affluence” (spe>bwe).
• In backward regions problem creates moreproblems.
• In developed regions auto-solutions solveall problems
• Myrdal contention is that the free play ofmarket forces and operation of profitmotive in the capitalist system normallytends to increase inequalities betweenregions rather than decrease.
• When backwash effect dominatesdivergence will develop; periphery willremain weak, only center will developand dualism in growth is promoted.
• When spread effect dominatesconvergence will develop; periphery willdevelop, there will be economicintegration between Centre andperiphery.
• CUMULATIVE CAUSATION THEORY PROVES THAT
• Market mechanism will not bring equality betweenregions but will increase inequalities.
• Nothing short of govt. Intervention will checkbackwash effect from getting cumulative.
• The theory is Centre periphery model because
• The favourable effects flow from Centre to periphery.
• Periphery supplies raw material and human power toCentre.
• Centre supplies finished output for consumption andinput.
CRITICAL EVALUATION
• This model combines national andinternational forces
Which tend to keep backward countries in thetrap of cumulative process where povertybecomes its own cause.
• Though not a communist he proved that theso called competitive markets instead ofsolving the problem of backward region itwould accentuate them.
• Myrdal have made important contributions tothe theories of convergence and divergence,
• Agglomeration and locational economies andthe theory of vicious circle.