The Role of Small Towns in the Local Economy and Some Implications for Development Policy

Over recent years, socio-economic restructuring has tended to undermine the tradition al functions of small rural towns. Empirical evidence also suggests that significant proportion s of economic transactions are carried out through the region al, national an d international economy. Establishing the degree to which a settlement is integrated into its locality provides an indication of its contemporary function s an d potential role in rural development. In this paper, reliable measures of economic linkages are developed, and it is shown that the strength of local integration is a function of the existing economic structure of the town as well as its proximity to metropolitan centres.