GROWTH POLE MODEL OF PERROUX

INTRODUCTION
Any growth that takes place basically occurs towards a specific location which is a result of
discontinuous growth and location.
This concept is developed by Francis perroux a leading French regional economist in 1955, He opined
that GROWTH IS NOT UBIQUOTOUS , rather than its poles , centres and points variable
intensities.
He considered growth pole as key driver of economic activities and development in a region. Basic
idea behind his theory is that the growth in a large city propels the growth in the all the areas
surrounding the large city due to exchange of goods and services.
NOTE: Periphery, hinterland and surrounding areas are synonyms to each other. They all imply the
villages, small towns and small industrial units present in the periphery of growth pole.
What is a Growth Pole?
Growth pole is an abstract economic area which acts as a field of force from which centrifugal forces
emanate to the periphery and to which primary products are attracted for addition of value. Altogether,
growth pole has three primary characteristics.
i. Homogeneous space: The growth pole is a homogeneous area i.e. the all economic
activities in the growth pole enjoy similar socio-economic, political and environment
benefits and constraints.
ii. Economic Plan: The growth pole is delimited by an economic plan. This means that the
the economic activities in the growth pole are planned and organized to achieve certain
economic and developmental goals.
iii. Field of Force: The growth pole emanates centrifugal and centripetal forces. Centrifugal
forces mean that the benefits of the economic activities and services in the growth pole
spreads to hinterland (periphery) of the growth pole. Centripetal forces means that growth
pole attracts the supply of raw material and primary products from the rural areas. services,
research centers, skill institutions, entertainment etc.
MAIN THEME
Key Points of the Growth Poles Theory(ASSUMPTIONS)
Non-Uniform Development: Economic growth is not evenly distributed across a region but
concentrates around specific growth poles or clusters.
Core Industries: Growth poles are characterized by core industries, which serve as the driving force
for development. These core industries can span diverse sectors, including automotive, aeronautics,
agribusiness, electronics, steel, and petrochemicals.
Direct Effects: Core industries have direct impacts by purchasing goods and services from their
suppliers (upstream linked industries) and providing goods and services to their customers (downstream
linked industries).
Indirect Effects: Economic growth extends indirectly through the demand for goods and services
generated by the people employed in core and linked industries, supporting the expansion of activities
like retail.
Spatial Concentration: Growth poles theory emphasizes the spatial concentration of economic
activities, fostering regional development and specialization.
Diversification: Growth poles may lead to diversification as linked industries develop, creating a
broader economic base in the region.

HYPOTHESIS
Non-Uniform Development: Economic growth does not occur uniformly across an entire region but
instead concentrates around specific poles, typically characterized by a key industry.
Linked Industries: Growth poles stimulate the development of linked industries, both directly and
indirectly, as they expand.
Expansion Effects: The growth of a key industry triggers the expansion of various economic aspects,
including output, employment, investments, technology adoption, and the emergence of new industrial
sectors.
Scale and Agglomeration Economics: Regional development around a growth pole is influenced by
the principles of scale and agglomeration economics, which result in unbalanced regional growth.
Transportation Significance: Transportation, especially transport terminals, plays a pivotal role in the
growth pole theory, as activities closely related to transportation are more likely to exhibit strong
relationships with the growth pole.
Secondary Growth Poles: Over time, the emergence of secondary growth poles is possible, particularly
when secondary industrial sectors and their associated linked industries also develop, further
diversifying and decentralizing economic growth.
He based his theory on the ideas of Schumpeter’s theory on the role of innovation and large scale firms
in economic growth.

• Dynamic Propulsive Firm Schumpeter opined that the entrepreneurial innovations are
prime causal factor of economic growth.
• These firms dominate other firms in scale of operation and have impulse to innovate.
These firms are called dynamic propulsive firm.
• Dynamic propulsive firms form leading propulsive industries.
• The firms and industries are fast growing, highly innovative and linked to other sectors of
importance.
• Any innovation in the large firm transmit to other firms and sectors. Leading to overall
growth of economy.
Similarly, Perroux incorporated the above ideas into his model and came up with growth pole
theory.

• The growth pole has agglomeration of industries which demand and supply goods from
each other. This agglomeration provide many externalities/advantages to new firms.
• Therefore, every upcoming entrepreneur established his/her firm in the large
agglomeration. Agglomeration due to cumulative causation is the process of increase in the
size of growth pole.
• English This large center of economic activities dominate other centers due to their
location and scale of operation.
• The growth pole transmits any innovation which takes place in the growth pole to its
hinterland and the hinterland also grows.

Forward and Backward Linkages

• The exchange of goods and services between growth pole and its hinterland takes place through
forwards and backward linkages.
• The exchange of goods and services takes place through many channels Backward linkage the
hinterland exports goods through trade channel raw materials, agricultural goods and food etc.
• The labour is supplied through migration channel. The goods and laborers are necessary for
operation of economic activities in growth pole.
• Forward linkage: The growth pole transmits new technology and knowledge through migration,
trade and financial channels .
• The growth pole supplies finished products such as food, clothing, sanitary products etc. to the
hinterland through trade channel.
 • In return for labor, the industries pays wages to the laborers in hinterland. Smaller industries in
the hinterland receive investment, new technology, institutional innovation and factor
technology.

Characteristics of a Leading Propulsive Industry:

1.Highly advanced level of technology and managerial expertise.
2.High income elasticity of demand for its products.
3.Marked local multiplier effects.
4.Strong inter – industry linkages with other sectors.
Effectiveness of this theory for Regional Planning:
According to Glasson (1974), the growth pole and growth center theory is attractive as a policy tool for
the following reasons:
(i) It tends to be an efficient way of generating growth and subsequent development: in the
surrounding due to various agglomeration economics.
(ii) Concentration of function in specific locations reduces the cost of investment.
(iii) The spread-effects out of the growth points will help to solve the problems of less developed
area.
Criticism of the theory:
The growth pole concept has, however, been criticized on several counts. Some of the important
criticisms are as under:
1. The first problem is the identification and selection of growth pole. If an independent or arbitrary
decision is made, the resource base may not be sustainable.
2. The nodal points and growth poles develop because of certain favorable geographical locations and
not because of selection of arbitrary sites.
3. The problem of threshold – overlapping.
4. Problem about the sectorial composition of growth pole.
5. Problem of establishment of regional network of firms.
6. Problem of social acceptability.
7. Each of the growth poles may thus lead to new socio-economic and ecological problems.
8. The selection of growth pole motivated by political consideration may not be sustainable. It has
happened in the case of Baruni and Bongaigaon, which have created new socioecological problems.

9. It is not necessary that growth poles and growth centers may remove the regional inequalities, leading
to an overall regional development. The impact of Bhilai and Rourkela can hardly be seen in the
surrounding tribal areas of Chhattisgarh and Orissa.

10. Problem of appropriate span over which to judge success of failure- say 16 to 25 years may be too
long in any social order and political system. In fact, an elected government would like to have positive
results within four or five years before the commencement of the next election.

Applicability of Growth pole theory or relevance:

Growth pole concept has become popular because of its orientation towards “dynamic industry” (i.e.-
dynamic propulsive firm & leading propulsive industry) “Polarization and agglomeration” (inter –
industry linkages of external economies) and the promise of censuring “Spread effects”. The success
and failure of a growth pole depends upon the extent of the resource availability and productive
demands of the society. The growth pole may thus create new socio-economic problems and may not
be helpful in removing the regional inequalities.