Gunnar Myrdal (1898 1987) Cumulative Causation Theory Applied to Regions
In this chapter, Hans Westlund evaluates Gunnar Myrdal's contributions to the analysis of regions' economic development. Myrdal recognized that economic problems could not be treated in isolation from society as a whole. Myrdal's most important work for regional science was Economic Theory and Underdeveloped Regions (1957) In contrast to stable equilibrium theory, he emphasized the role of self reinforcing processes and circular causation for both growth and decline. Pessimistic about development prospects in South and Southeast Asia, mainly due to institutional conditions, Myrdal's views proved wrong for many Third World countries. Today at the regional level, however, increasing disparities are found in many countries, and his writings feel surprisingly prescient. Both endogenous growth theory and the new economic geography find support in Myrdal's cumulative causation principle.