Regional Development, Equality and Gender

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DOI: 10.1177/0143831X134890442013

2013 34: 483 originally published online 27 JuneEconomic and Industrial Democracy Diane Perrons and Robin Dunford

and socially sustainable measuresRegional development, equality and gender: Moving towards more inclusive

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Economic and Industrial Democracy34(3) 483 –499

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DOI: 10.1177/0143831X13489044

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Regional development, equality

and gender: Moving towardsmore inclusive and sociallysustainable measures

Diane PerronsLondon School of Economics, UK

Robin DunfordUniversity of Exeter, UK

AbstractAs the efficacy of the neoliberal model is now in question this is an appropriate moment to

consider ‘what kind of regional development and for whom?’, or, as the authors interpret it,

what kind of development model would be inclusive and economically and socially sustainable.Current indicators of regional performance are based on growth alone, overlook distribution

and so misrepresent the performance of regions in terms of social well-being. An alternative,

more inclusive measure of regional development and a gender sensitive variant are calculated

for UK regions. On these measures London falls from the top ranked region to a middle rank

on the regional development indicator and on the gender sensitive variant falls to the lowest

position, arguably better reflecting the experience of life in this region. Optimistically, use of these

measures would lead to more inclusive models of development that would render the more

contentious social, redistributive policies less necessary.

KeywordsEconomic change, inequality, regional development, social inclusion/exclusion

It is not enough for us to talk about the different global challenges, as energy, climate

change, health, security and the environment. We need widely accepted communication tools

that show progress in these fields. And that progress can only be measured with suitable

indicators. So it’s time to go beyond the tools developed for the very different world of the

1930s. It’s time to go beyond today’s situation. ... It’s time to go beyond GDP.

(Barroso, 2007: 2)

Corresponding author:

Diane Perrons, London School of Economics, Houghton Street, London WC2A 2AE, UK.

Email: [email protected]

EID34310.1177/0143831X13489044Economicand Industrial DemocracyPerronsandDunford2013

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484 Economic and Industrial Democracy 34(3)

Current indicators of regional performance are based on GDP alone, and consequently

fail to account for broader questions regarding the distribution of resources. This exclu-

sive focus on growth fails to account for broader performance in terms of social well-

being, and in so doing, fails to consider the question of ‘what kind of regional development

and for whom’ (Pike et al., 2007) or, alternatively, what kind of development model isinclusive and economically and socially sustainable. After highlighting problems with

existing models of regional development based predominantly on growth in terms of

GDP, this article draws on the capabilities perspective and the UN human development

index to develop an alternative, more holistic measure of regional performance, before

adding a gender dimension to this measure. This shift to an alternative, more inclusive

measure of regional development and to a gender sensitive variant leads to a very differ-

ent understanding of the performance of regions. We demonstrate the difference this

change of measure makes to London, which falls from the top ranked region to a middle

rank within the UK on the regional development indicator, with the gender sensitive vari-ant leaving London in the lowest position. We argue that this measure not only better

reflects the experience of life in this region, but that potentially it also places the econ-

omy back in its rightful place of provisioning for society as a whole.

The 2008 financial crisis has called into question the efficacy of the neoliberal model

of regional development, rendering it an appropriate moment to consider the question of

what kind of alternative development model would be inclusive and sustainable. Feminist

(Seguino, 2010) and heterodox (Krugman, 2012; Reich, 2010; Stiglitz, 2011) economists

show how the 2008 financial crisis that originated in the US and UK was linked to a

global demand deficit, with the pursuit of neoliberal free market economic policies gen-erating rising earnings inequality and a decreasing share of value added accruing to

labour.1 Accordingly, they advocate forms of Keynesianism in order to redress the

inequality and re-establish more inclusive economic growth. For a time, such alternative

models were on the agenda. Yet states and institutions, including the European Union

(EU), continued and are continuing to pursue neoliberalism in the form of austerity poli-

cies in the attempt to stabilize government finances, restore confidence in the economy

and re-establish economic growth. These policies are being followed regardless of the

experience of the 1930s recession, which showed clearly that such policies were ineffec-

tive in a depressed economy. The key problem, both then and now, is ineffective demand,rendering cuts to welfare and spending part of the problem, rather than a solution

(Krugman, 2012). More importantly for the discussion pursued here, they are being fol-

lowed despite EU objectives for inclusive growth. This objective for inclusive growth is

being undermined, with research from the EU’s Directorate General highlighting the

steep rise in inequality in the EU in the last three decades (INEQ, 2009; Perrons and

Plomien, 2010).2

One of the key obstacles in moving towards more inclusive models of economic and

regional development is the understanding of the relation between economic and social

issues in policy thought and practice. Where the economy and broader social concerns are

considered together, the economy is accorded priority, with social issues addressed for

their economic benefit, and not for their intrinsic worth. The EU annual cohesion reports,

for instance, do consider wider issues of well-being such as ‘education’ and ‘training’, but

they introduce these issues for their instrumental value in making the EU economy ‘more







Perrons and Dunford 485

productive’ in order, ultimately, to ‘maintain or increase its global market share’ (EU,

2011a: Section 2). With this priority of the market in place, eligibility for funding depends

primarily upon regional GDP per capita (Dunford and Perrons, 2012; EU, 2011b).3

Furthermore, policy makers need to have tools that enable them to take swift, well

informed and effective decisions, a need which provided the original rationale for theGDP measure in order to avoid policy-makers being ‘adrift in a sea of unorganised data’

(Samuelson and Nordhaus, 1995: 78). Since ‘what gets measured is more likely to get

addressed’ (Moser, 2007: 13) it is important that the distributive qualities and social con-

sequences of economic growth are taken into account in measures of regional perfor-

mance in order that concerns regarding social well-being and inclusion are given due

consideration. Relying on ex post redistribution to secure inclusivity is unsatisfactory,

partly because it can be politically unpopular among donors and recipients alike but also

because social justice requires that it is possible for people to contribute to the societies

where they live and that they are valued appropriately for what they do.The article begins by highlighting the contradictions between the EU objectives for

sustainable economic and social progress and cohesion on the one hand and the current

neoliberal model of development associated with widening social and spatial inequali-

ties on the other. It then outlines problems with using GDP as a measure of develop-

ment, before drawing on the capabilities perspective to consider alternative ways of

conceptualizing and measuring development. Drawing on but not replicating this

approach, the article provides a tentative illustration of how economic performance and

social well-being can be combined in a measure of regional performance in an attempt

to redress the prevailing separation between the economy and society in the statisticalmeasures that influence policy thought. This broader approach towards measuring

development questions the veracity of the traditional GDP approach, and leads to a dif-

ferent ranking regional performance in the UK. Most notably, it questions the idea that

it is appropriate to portray London as the most successful and highest performing region

in Europe, when 650,000 or around 41% of children there are growing up in poverty

(London Child Poverty Commission, 2010). In relegating London to a middle ranking

amongst UK regions, the measure proposed thus provides a more accurate portrayal of

the well-being of the region as it is experienced by the people living there. Men and

women are affected differently by any economic and social policy. It cannot be assumed,therefore, that what is good for the economy and society is automatically equally good

for men and women. As a consequence, when policies for restoring growth are consid-

ered it is necessary to consider their implications for gender a priori, as, indeed, adher-

ence to gender mainstreaming requires. To this end, the article goes on to develop a

gender sensitive variant of this model – the Gender Sensitive Regional Development

Indicator (GRDI); a model upon which London falls further, to become the bottom

ranked UK region.

Economic and social policy in the European UnionFrom the outset the EU aimed to promote economic and social progress, to secure spa-

tially balanced and sustainable development, and to maintain a high level of employ-

ment, while promoting gender equality in the labour market.4 Despite these combined








economic and social objectives, economic issues dominate the policy agenda and are

subject to stronger monitoring and enforcement, while policies for securing greater

cohesion and for combating poverty and social exclusion are more aspirational and less

onerous. Underlying the priority given to the economy is the implied assumption that

the economy and economic policies are wealth creating while social policies are purelyredistributive. Yet economic growth can be highly redistributive, as the last three dec-

ades of rising inequality have shown. Capital, rather than labour, has taken an increas-

ing share of value added, as productivity increases have taken place at a much faster rate

than wage increases overall but especially in the case of low paid workers. Earnings

rose more slowly than productivity for 61% of EU workforce between 2003 and 2006,

following an earlier trend and continuing into the future (INEQ, 2009; OECD, 2011;

Perrons and Plomien, 2010). These figures are confirmed by research for a wider range

of world regions (ILO, 2008; UNCTAD, 2012). What this means is that paid employ-

ment, which has always formed a key element of the EU’s Employment Strategy, nolonger provides a guaranteed route out of poverty. In the UK, for instance, ‘more than

half of children and adults in poverty now live in working households’ (Joseph Rowntree

Foundation, 2012). Moreover this redistribution of social wealth from labour to capital

contributes to the demand deficit identified by heterodox and feminist economists as an

underlying cause of the 2008 global financial crisis, and of the subsequent difficulties

experienced by the US, UK and other countries in the European Union including Spain,

Greece, Ireland and Portugal to move out of depression (Krugman, 2012; Seguino,

2010; Stiglitz, 2012).

On a spatial level, there has been a decline in inequalities between EU member states.But these have been accompanied by increases in within-country inequality in most

countries (Montfort, 2009). Social or interpersonal inequality more broadly has been

increasing in nearly all EU member states during the last three decades and accounts for

a larger share (80%) of overall inequality. This inequality matters because it is associated

with lower life expectancy, higher levels of illiteracy, higher levels of stress and mental

illness, higher rates of crime and violence and drug addiction and higher levels of pov-

erty. Indeed, if the level of inequality in the UK were similar to that prevailing in

Scandinavia then British people would be thinner and saner, live a year or so longer, trust

each other more and have more holidays each year (Wilkinson and Pickett, 2009).Moreover as pointed out above, inequality is also associated with the economic crisis and

subsequent recession in Europe.

A meta-analysis of EU research on inequality suggests that inequalities can be

resolved effectively only by realizing the synergy between economic and social goals in

practice. In response to prevailing understandings of economic processes as wealth cre-

ating, it is important to see that they are also redistributive, and in response to prevailing

understandings of social policies as a cost, it is important to see that they can also be

productive (Perrons and Plomien, 2010). Although, EU regional policies target economic

and social inclusion, the current measure of regional performance, GDP, only relates to

growth. This article suggests, therefore, that this measure is inadequate and new ways of

measuring performance which combine economic and social issues are necessary. Only

then will the measures of performance reflect the combined stated objectives of the

European Union for economic and social cohesion.









Alternative ways of conceptualizing and measuring

development

At least until the economic crisis of 2008, statements from EU commissioners and politi-

cians advocated thinking beyond GDP in order to better reflect well-being. The Presidentof the European Commission, José Manuel Barroso, highlighted the continuing impor-

tance of GDP for measuring progress in the economy. But in 2007 in the quotation with

which this article began he nonetheless endorsed the remarks of Simon Kuznets (1934:

7), one of the founders of the GDP measure, that economic indicators solely measure

market activity and not well-being, stating that ‘economic indicators were but one piece

of the puzzle of citizens’ wellbeing’, and that, the ‘welfare of a nation can scarcely be

inferred from a measurement of national income’.

Similar sentiments were expressed by President Sarkozy of France who commis-

sioned the Stiglitz report on the Measurement of Economic Performance and SocialProgress (Stiglitz et al., 2009). This report is strongly influenced by Amartya Sen’s capa-

bilities perspective and shares Sen’s (2010: 226) view that GDP is not an adequate meas-

ure of development because it measures means rather than ends. As such GDP has

‘conditional’ rather than ‘intrinsic’ value. Sen argues that:

The capability approach focuses on human life, and not just on some detached object of

convenience, such as incomes or commodities that a person may possess, which are often

taken, especially in economic analysis, to be the main criteria of human success. Indeed it

proposes a serious departure from concentrating on the means of living to the actual

opportunities of living. (Sen, 2010: 233, original emphasis)

For example whilst a given amount of money might provide means for living and pursu-

ing life choices, it will translate differently into actual opportunities in the case of an able

bodied, independent person, and a person with disabilities who, unless services are pro-

vided, must spend a large amount of that money on equipment and care that is required

for the pursuit of their broader life choices. This article highlights two interrelated and

practical issues that are particularly important for measuring the development not of

individual well-being but the well-being of an area. It then seeks to develop a measure

that better encapsulates the connections between economic and social issues.One of the main problems with using GDP per capita as a measure of development or

performance, also highlighted by the Stiglitz Commission, is that GDP per capita for any

particular region is an average measure and consequently overlooks wide differences in

the well-being experienced by different people in the region. It is possible therefore to

find high levels of poverty in regions measured as prosperous on GDP alone. If such

regions become models for development there is a risk of replicating the serious prob-

lems of inequality and poverty. As stated at the outset, London is the most prosperous

region in the UK and the EU. But it is also characterized by the highest level of incomes

and earnings inequality in the UK, has a high rate of child poverty and has comparativelylow employment rates. None of these features would seem to suggest that London con-

stitutes the ideal model for other regions to follow.

A related problem is that people living in regions that appear to be poor in terms of

GDP per capita may enjoy lifestyles with non-pecuniary benefits that, despite not being








taken into account in the GDP measure, may nonetheless raise their standard of living. In

other words, just as poverty can be found among prosperity, prosperity in low income

regions can be overlooked, especially when value arises from subsistence production or

self-provisioning of goods and services production. As Vandana Shiva (1989: 10–12)

argues, it is possible that societies ‘which satisfy basic needs through self-provisioningare not poor in the sense of being deprived’, but the ‘ideology of development declares

them so because they do not participate overwhelmingly in the market economy’. Shiva

(1989: 10–12) maintains that development is a ‘culturally biased project’ that ‘destroys

wholesome and sustainable lifestyles’ and can create ‘real material poverty’ by denying

people the opportunity to continue their subsistence ways of living as resources are

diverted towards ‘resource intensive commodity production’. While there are problems

with Shiva’s analysis in terms of her tendency to romanticize subsistence societies and

her essentialist claim that these societies ‘embody the feminine principle’ as ‘women are

the producers of life’, the idea of culturally perceived poverty and that non-market waysof life may be associated with higher levels of overall well-being deserves attention.

One illustration of the significance of subsistence lifestyles arises from the non-devel-

opment of the upper part of the Alta dam project in northern Norway in the 1970s. The

Alta dam project would, from the perspective of GDP, have been a positive development,

insofar as it would generate employment on previously ‘unproductive’ land, whilst also

working to profit developers. But had it gone ahead, the project would have led to the

village of Masi being flooded, compromising the ability of the Sámi to continue their

existing ways of securing their livelihoods. Because the Sámi lifestyle involved subsist-

ence practices, the region where they reside would be considered poor from a GDP per-spective. But as their extensive campaign against the project demonstrated, they clearly

felt their lifestyle was worth fighting for, and felt that they would be harmed, rather than

lifted out of poverty, by a forced change in lifestyle. In this instance, their campaign,

together with conservation groups, prevented the village of Masi from being drowned,

and to some extent enabled the Sámi, albeit supported by the Norwegian welfare state, to

continue their lifestyle. While much of the rest of the project went ahead and led to some

changes in fish stocks and reindeer paths that created difficulties for the Sámi, the con-

tinued protests, together with subsequent decline in energy demand in the early 1990s

owing to higher temperatures and the closing of an aluminium smelter, resulted in pro-tection for other river basins in Norway and to constitutional change leading to official

recognition of the cultural, social and political life of the Sámi.5 However, this success is

probably more of an exception and more generally resource development challenges

existing ways of life in many peripheral regions, for example, potential resource extrac-

tion in Greenland will be a key issue in coming years with global warming.

Whilst examples of subsistence lifestyles provide perhaps the most dramatic illustra-

tion of the claim that economic growth does not necessarily capture regional perfor-

mance, numerous examples can be found from everyday life. On measures of growth

alone, closing economically unproductive open spaces would always be justified, in spite

of whether these spaces provide relief and relaxation in urban environments or whether

they are home to non-productive activities that nonetheless improve the well-being of

people, like community vegetable growing. Deciding who has the right to decide over

these various development issues is very complex, especially as what happens in one








area affects the well-being of people in others, and, as Doreen Massey (1996) pointed

out, even if the right is given to the original residents, it is often difficult to decide who

exactly these people are given past migration practices. Nonetheless, the general argu-

ment that it is important to widen the understanding of regional performance beyond

growth in order to ensure that the economy serves society rather than vice versa stillholds, and it is this argument that provides the rationale for devising more appropriate

measures of development that link economic growth and social well-being.

Thinking about well-being rather than simply economic growth matters, but from the

perspective of social justice it is also necessary to exercise caution. Prior to assuming

office, David Cameron, the current UK Prime Minister, commented that: ‘It’s time we

admitted that there’s more to life than money, and it’s time we focused not just on GDP

but on GWB – general wellbeing’ (BBC, 2006). Subsequently, when in office, David

Cameron (2010) repeated these sentiments, drawing from President Kennedy’s fre-

quently quoted critique of GDP,6 and asked the Office of National Statistics (ONS) todevelop measures of well-being and progress in order to ‘lead to government policy that

is more focused not just on the bottom line, but on all those things that make life worth-

while’. The measures being developed by ONS focus on both subjective and objective

measures of well-being, and thus include ‘feelings of happiness’ and that ‘one’s activities

are worthwhile’, alongside more objective measures of health and education. At the time

of writing these statistics were not yet available.

Subjective measures have also been developed by the Greater London Authority,

which has developed a measure of subjective well-being based on 12 indicators for sub-

regions within London (GLA, 2012). But whilst not denying the significance of subjec-tive senses of well-being, there are problems associated with including such variables in

comparative measures owing to the likelihood of adaptive preferences. In reality, people

may adapt or limit their preferences and desires to the horizons with which they are

familiar and the context in which they live. As a consequence there could be a wide

divergence between subjective measures of well-being and more objective measures

such as income. Such behaviour could lead to acceptance of a very inegalitarian income

and opportunity structure. Angus Deaton (2012), in a study which analysed self-reported

well-being during the US economic crisis, found little association between people’s

reported sense of well-being and the large fluctuations in income, unemployment andwealth that took place. Unsurprisingly he found that subjective well-being declined dur-

ing the first two years of the crisis but then improved as people become accustomed to

the more austere conditions, even though the ‘objective’ measures continued to deterio-

rate.7 In addition, happiness can depend on a wide range of contingent personal circum-

stances about which social or regional policies could do very little. For these reasons the

Regional Development Indicator (RDI) developed here rests on objective measures, but

these measures concern not only economic variables but also social variables.

Measuring regional performance in the UK On the conventional measure of regional performance GDP or GVA (gross value

added, a term more frequently used in the European Union), London and to a much

lesser extent South East England perform much more strongly than the other regions








of the UK, as Figure 1 illustrates. These are the only regions which have a GVA percapita measure that is higher than the UK average. Furthermore, the extent of differ-

ence between London and the rest of the UK has expanded in the last two decades, and

even expanded between 2007 and 2010 (the last year for which data were available)

despite the fact that the difference is accounted for in disproportionate part by the loca-

tion in London of the finance sector, which triggered the crisis. This trend is likely to

continue as the regions outside London and the South East are much more dependent

on public sector employment, which has formed the focus of government expenditure

cuts since 2010.

London, however, is the region where inequality is highest, largely because this iswhere all the major finance and professional service firms are located together with some

corporate headquarters. These employers pay high salaries and offer other benefits to

their elite employees. As has often been pointed out, these firms and employees also

generate a strong demand for private sector services such as cleaning, catering, security,

hotels and leisure, which typically pay low wages to the majority of their employees

(McDowell et al., 2005; Sassen, 2001). Wages in these sectors are depressed by the pre-

vailing working contracts that offer highly flexible and temporary employment, often

through employment agencies. These sectors also have a high migrant density and both

of these characteristics tend to weaken the capacity for worker organization (Dyer et al.,2010), though there are exceptions (see Wills, 2012). These employment divisions which

are also gendered, together with the high level of child poverty, suggest that measuring

regional performance by GDP alone does not fully encapsulate the experience of living

in London.

Figure 1. Regional performance relative to the UK, 1997–2010.









So rather than using either GDP or subjective measures of well-being on their own

we propose a measure of regional development that reflects economic and social char-

acteristics and shares the objectives of the UNDP’s (1990) human development index

(HDI),8 to provide a holistic measure of material progress and human well-being

(UNDP, 2010a). In this way the inadequacies associated with GDP and the potentialconservatism linked with purely subjective measures of social well-being are avoided.

In addition, by selecting the variables to be included in the index, this method also

avoids some of the complexities that would arise if the capabilities approach was fol-

lowed in its entirety.9

Similar to the HDI, income, education and life expectancy form the core variables of

the RDI, but they were defined and measured differently in order to reflect the character-

istics of a high income region. Four variables were included: Healthy Life, Knowledge,

Economic Standard of Living and Employment.

Healthy Life is measured by the infant mortality rate and the standardized mortalityratio in order to reflect both living and working environments. While both rates have

been declining in the UK, considerable differences remain by social class and by region.

Knowledge is measured by the proportion of the population without any qualifica-

tions, because this is more likely to reflect characteristics of the population growing up

and remaining in the region, as people with higher qualifications are more mobile. Whilst

this measure is incomplete insofar as knowledge has multiple dimensions of which for-

mal education is only one, it is the dimension which bears most weight in employment

decisions, as well as being the only aspect of knowledge which can be measured with

precision. Economic Standard of Living is based on a composite measure of median earnings, in

order to give a broad sense of well-being; earnings inequality, measured by the 90–10

decile range to reflect how the wealth of the region is distributed; and child poverty, to

reflect how well economies provide for the well-being of their most vulnerable citizens.

In focusing on inequalities, the RDI shares a similarity with the New Economics

Foundation’s (2010) regional index of sustainable economic well-being (R-ISEW),

although their index focuses primarily on environmental concerns, which are not

addressed here. Earnings also reflects the occupational opportunities available to people

and so encapsulates some aspects of economic development. In this respect there is aclear departure from the capabilities perspective as Sen (2010) would consider earnings

to be a means, an input to other achievements, rather than an outcome, but in market

societies almost all ends require some monetary income so arguably income increases

the capability to exercise a wide range of preferences.

Employment is measured by the employment rate in order to mirror involvement in

productive and socially valued activities. In contemporary high income societies paid

employment forms an important part of social identity as well as a means of socialization

in addition to the income gained, and so employment makes an important contribution to

well-being independent of its effect on income.

Overall the index includes economic and social dimensions of regional performance

and differs from measures based on GDP alone and those that focus solely on subjective

social well-being. In this way people are recognized as contributors to rather than recipi-

ents of welfare.









To calculate the index, we follow the same method as the UNDP (2010b), specifically

we normalize each variable using the min-max method, and take the geometric mean of

the sum of components to form the composite index. The overall suitability and structure

of the indicator was verified by identifying the correlation coefficients between the dif-

ferent components and principal components analysis (PCA) analysis was used to checkthat these variables relate to an underlying phenomenon, which we term regional

development.

Using a similar methodology but slightly different variables we then calculated a

Gender Sensitive Regional Development Index (GRDI) to consider the extent to which

development is shared equally by women and men, and to reflect policy concerns with

gender mainstreaming. In this case only three variables were included:

Healthy Life: is measured by the gender ratio of the standardized mortality ratio;

Economic Standard of Living : is measured by the gender wage gap at the inter-decilerange; and

Employment : is measured by the gender ratio of the full-time employment rate.

The two models differ in some respects because in the case of qualifications and median

earnings the regional variations outweighed the gender variations and so they added little

in terms of reflecting differences in gender inequality between the regions. The child

related variables were excluded owing to lack of gender differentiated variables.

Contrasting measures and understandings of regional

development

The RDI and GRDI are contrasted with the orthodox approach to measuring regional

performance based on regional income – GVA/GDP. Tables 1 and 2 show how the regions

are ranked on these different measures. The ranking of some regions remains remarkably

stable while the position of others changes considerably. As we have seen, on the GVA/

GDP measure London is ranked first, as the top performing region, followed by the

South East. While the South East moves into the top position on the RDI, the position of

London changes dramatically, moving into 7th position. Arguably this lower position ofLondon more accurately reflects life for many people in the region. Certainly, a measure

which portrays London as the most affluent region of both the UK and the EU (Inner

London 328% of EU average in 2010), when 650,000 children living there (41% of the

total, and 48% for Inner London) are being brought up in poverty (after housing costs)

(London Child Poverty Commission, 2010) seems questionable, especially if this region

is to be portrayed as a successful model for others to follow. The stability of the South

East indicates that this is more uniformly a region of affluence. The North West and the

West Midlands also have lower rankings on the RDI reflecting lower levels of social

development with respect to qualifications, health and child poverty compared to else-where, issues not picked up effectively in the GVA/GDP measure of performance. By

contrast Wales and the South West improve their positions on the RDI measure, showing,

in the case of the South West in particular, the lower level of inequality, compared to

London. Clearly equality is not in itself necessarily desirable if it means that everyone is








living at a lower standard, but given that inequality has an independent association with

a wide range of social costs (Wilkinson and Pickett, 2009) it suggests that these regions

have some positive features, notably features associated with social cohesion and poten-

tial harmony that could be overlooked in a model focused on growth alone.

Table 1. Contrasting measures of UK regional performance (2010–2011).

GVA RDI

LON 1 7

SE 2 1Scot 3 5

EE 4 3

SW 5 2

EM 6 4

NW 7 9

WM 8 10

Y 9 8

NE 10 11

NI 11 12

Wal 12 6

Note: RDI = (HL + K + ESL + E)/4; HL = healthy life (infant mortality and the standardized mortality ratio);K = knowledge (percentage of the population with no qualifications); ESL = economic standard of living(earnings and income, measured by a composite of median earnings, earnings inequality (90–10 ratio) andchild poverty); E = employment (full-time employment rate).Source: Data from ONS (2012).

Table 2. Gender-sensitive RDI (2010–2011).

GVA GRDI

LON 1 12

SE 2 6

Scot 3 4

EE 4 7

SW 5 9

EM 6 10

NW 7 5

WM 8 11

Y 9 3

NE 10 2

NI 11 8

Wal 12 1

Note: GRDI = (HL + ESL + E)/3; HL = healthy life (gender ratio of the standardized mortality ratio); ESL= economic standard of living (the gender ratio of earnings based the inter-decile range difference); E =employment (gender ratio of the full-time employment rate). To provide a consistent measure the index,that is, such that all variables moved in the same direction the values of components were measured so thata narrowing of the gender gap would be to women’s advantage.Source: Data from ONS (2012).









When gender is taken into account the ranking of regions changes more dramatically.

London becomes the lowest performing region and on this measure the South East also

falls – to the 6th position. By contrast the ranking of Wales and the North East increases.

Taking the case of London first, this lower ranking indicates that many of the high paying

jobs in London are a male preserve, despite the increasing proportion of women workingin professional and managerial jobs in London over recent decades and the existence of

active equal opportunities and diversity policies amongst many of the top corporations.

Also, some corporations seem to have a genuine desire to increase the proportion of

women in top positions in order to meet client preferences for a female advisor. Even so,

women continue to occupy only a minute proportion of these jobs. In the case of the legal

sector, managers readily acknowledge that diversity is the right thing to do, only to con-

sciously decide not to operate the policy when faced with real decisions, as gender ste-

reotypes still influence their notions of suitability and competency for top positions

(Ashley, 2010). In this respect the extent to which gender prejudice pervades the prevail-ing culture of organizations remains unrecognized (Gonäs and Karlsson, 2006;

McDowell, 2010). Such decisions lead to the perpetuation of the situation whereby the

majority of top earners including the top 1%, in the UK, are disproportionately male,

middle aged and middle class, work in professional and managerial occupations and live

in London and the South East (Brewer et al., 2008). The decline in the position of the

South East, and indeed all of the regions in the southern England on the GRDI, similarly

reflects the large earnings gap between women and men, with men disproportionately

occupying the highest positions within the professional and managerial occupations, in

which compared to the rest of the UK, a larger share of the population are occupied. Toassociate this concentration with successful regional performance seems a rather myopic

view of development.

By contrast the North East of England moves in the opposite direction, improving its

ranking from 10th and 11th respectively on the GDP, and RDI measures to 2nd on the

GRDI. This movement reflects the economic restructuring of the North East region espe-

cially since the mid-1970s and perhaps longer. Historically the regional economy of the

North East had been built on heavy industry: iron and steel, coal mining and chemicals.

The iron and steel industries began to decline during the 1920s and 1930s, recovered

somewhat during the 1939–1945 war but then declined again towards the end of the1960s and have continued to decline subsequently. As a consequence the region has been

the subject of many regional development initiatives with mixed success. During the

1970s and 1980s a range of light assembly manufacturing activities were located there

and during the 1990s a few modern electronic plants – Fujitsu and Siemens – were estab-

lished, but for only a short period. Siemens, for example, built but never opened its plant.

In addition during the 1970s and 1980s there was considerable expansion of public sec-

tor jobs in health education and social care and subsequently private sector development

of call centres and cultural industries (Hudson, 2011). None of these developments were

on a sufficient scale to redress the weak economic position of the North East relative to

the rest of the UK, but they did change the gender balance of employment. This region

of heavy industry had been epitomized by the male breadwinner/female homemaker

model. But from the 1970s and 1980s this began to change as jobs for women became

more readily available than jobs for men, leading to a substantial change, though not a








transformation, of gender relations in the household (Morris, 1991). In the context of the

current crisis and anticipated cuts in public spending post-2010, it is likely that the

employment rate of women will fall, potentially plunging the region back socially as

well as economically. Nonetheless these two illustrations show how calculating the

GRDI reveals how different ways of restructuring and developing an economy affectwomen and men in different ways. Given the public commitment to promoting gender

equality through gender mainstreaming, the GRDI provides a way of assessing the gen-

der implications of change as well as highlighting the limitations of a model of regional

development based solely on economic growth.

Conclusion

As the economic crisis hit many countries, especially the US, UK and Southern Europe,

it looked as though some consolation might be offered with attention being given toalternative ways of running the economy and society. These alternatives promised to

make society more economically and socially equitable and more sustainable. But this

silver lining was quickly erased by a focus on a need to restore growth for growth’s sake

through austerity policies including cuts in public spending (Perrons and Plomien,

2013). Challenging this focus on GDP as the sole measure of development and emphasis

on cuts to spending that not only perpetuate the lack of demand that fuelled the crisis but

also result in growing inequalities requires not only a clear analysis of the provenance of

the crisis but also some way of evaluating alternative possibilities. This article has pro-

posed a more comprehensive and gendered measure of regional well-being in an attemptto redress current policy fragmentation between economic and social concerns. It applied

the measure to UK regions and as a consequence found that London appears less of a

successful region. Instead, London is seen as a region of substantial inequalities, with a

concentration of firms paying high salaries, especially to their male employees, existing

alongside significant social problems including child poverty and gender inequality. This

presentation better reflects how people in the region experience their lives. By contrast

while the North East region continues to have severe problems from the perspective of

economic growth alone, the recent rounds of restructuring have contributed to securing

greater balance in gender relations.In demonstrating that GDP alone is not indicative of socially cohesive development

that works to advance well-being, and by providing an alternative measure that includes

broader concerns relating to social cohesion, these alternative ways of assessing regional

performance help to overcome the narrow, socially disembedded understanding of the

economy as a good in itself. Not only does this indicate that there are more appropriate

measures by which to assess European objectives for growth, but it can also play a role

in returning the economy to its rightful place of provisioning for society as a whole.

Furthermore, given that decisions relating to development are made with reference to

and justified in terms of measures of development, shifting towards the GRDI proposed

here might help ensure that development decisions work towards the advantage of soci-

ety at large, reducing the need for subsequent policies that redistribute wealth, and might

ameliorate the excesses of development projects that, despite advancing GDP through

mass profits for a minority, work towards the deprivation of others.









Funding

This research received no specific grant from any funding agency in the public, commercial, or

not-for-profit sectors.

Notes

1. Heterodox economics is an umbrella term referring to schools of economic thought that do not

conform to the neoclassical paradigm. Here, by heterodox economics we make particular

reference to contemporary Keynesian economists, including Joseph Stiglitz (2011), Paul

Krugman (2012) and Robert Reich (2010).

2. Perrons and Plomien (2012) provides a meta-analysis of over 70 articles, books and reports

arising from projects on inequality financed by DG Research.

3. This is not to say that wealthier regions do not receive development funds. London, for

instance, received €161 million from the European Regional Development Fund and €435

million from the European Social Fund. Eligibility for this funding, however, was based onregional competitiveness and employment criteria, and not on the basis of or to support pov-

erty in the region. As a result, the fund is directed towards ‘skills training, business develop-

ment and regeneration’, and is not directly intended to support poverty alleviation (Enterprise

Europe Network London, 2007).

4. These aspiration are expressed in the EU Treaty in a number of Articles – 2, 3, 137, 141 and 158.

5. The information comes from an exhibition about the People’s Movement against the

Development of the Alta-Kautokeino Watercourse at the World Heritage Rock Art Centre:

Alta Museum, Alta, Northern Norway; see also Briggs (2004).

6. ‘The point is that all of life can’t be measured on a balance sheet, and no one put that better

than Robert Kennedy more than 40 years ago, in a fantastic speech. He said that GDP, and Iquote, “does not allow for the health of our children, the quality of their education, or the joy

of their play. It measures neither our wisdom nor our learning; neither our compassion nor our

devotion to our country; it measures everything, in short, except that which makes life worth-

while.” I consider this to be a slight overstatement, but it was Kennedy style – beautifully put.

Simple and profound words, but we haven’t yet heeded them in our country’ Cameron, 2010).

7. See also White et al. (2012) for an extensive critique of the cultural values embedded in the

Stiglitz report.

8. The UN HDI, along with the Social Well-Being Index proposed by the Commission on the

Measurement of Economic Performance and Social Progress (Stiglitz et al., 2009) and a long

tradition of work on social indicators (see for example Tsai et al., 2012), provide existingexamples of measures of development that factor in broader concerns regarding well-being,

but they are rarely developed at the regional level.

9. For a discussion of the difficulties associated with following a capabilities approach directly

see Perrons (2012).

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Author biographies

Diane Perrons is Professor of Economic Geography and Gender Studies at the London School of

Economics. She conducts research on globalization, gender and inequality, focusing on the impact

of economic transformation, social change and the changing organization of paid work on uneven

development and the social reproduction of daily life.

Robin Dunford is a lecturer in political theory at University of Exeter’s Cornwall campus and a

research assistant in the Gender Institute at the London School of Economics. His area of special-

ism lies in political theory, but he looks to bring theoretical accounts of justice, rights and democ-

racy into relation with contemporary political events.

Regional Development, Equality and Gender

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