A programming approach to regional economic planning: an application to the Newfoundland economy.

Ypsilanti, Dimitri (1970) A programming approach to regional economic planning: an application to the Newfoundland economy. Masters thesis, Memorial University of Newfoundland.

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Abstract

The aim of this study is to present and apply a programming model to the Newfoundland economy through which the efficient allocation of scarce factor inputs can be determined. In addition the possible results that the elimination of resource misallocation would have on the level of Provincial income and on the rate of growth of the economy within the next five years are explored. -- The model used to achieve this aim is based on a combination of linear programming and input-output analysis. This allows general equilibrium and structural interdependence to be taken into account so that efficient and optimum resource allocation can be achieved for the economy as a whole. -- Chapter I briefly examines the crucial variables in the Newfoundland economy which reveal that resource misallocation has taken place to some extent. -- In Chapter II the theoretical aspects of allocation are discussed. The conclusion is that to prevent resource misallocation coordinated investment is required, that is, planning. -- The general activity model is presented in Chapter III and two empirical models used in planning regional economic development are criticized. The planning model and methodology used in this study is then discussed. -- In Chapter IV the planning model is applied to the Newfoundland economy. An optimum solution for each period of the planning period is obtained and briefly discussed. -- Chapter V gives the main conclusions of the study. These are: -- 1) Relatively high rates of growth are possible in Newfoundland of up to a maximum of 15% per annum. -- 2) Labour, although relatively abundant in the initial periods, becomes the operative constraint quite early in the planning period. -- 3) With efficient allocation of resources the gap between Newfoundland and Canadian per capita income would close quite rapidly.

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