is the government’s attempt to correct imbalances of income and employment by stimulating the local economy of less prosperous areas. (See also development area .)
• reduces inequality of incomes and of opportunities
• reduces the hardship associated with structural decline
• reduces congestion in other regions
• by reducing unemployment it reduces the waste and cost of keeping workers on benefits
• there is little evidence that it works to change long-term trends
• firms often move a very short distance to take advantage of the incentives, but in so doing create no extra jobs or incomes
• to be effective, it requires substantial government spending; successful firms might argue that they are subsidising less successful ones.