The role of services in regional and urban development: A reappraisal of our understanding

A first approach is a primarily theoretical re-examination of the economic base model. It is concluded that only with substantial modification, can it be maintained as a simple model of the interplay between sectors creating regional and urban development. A second approach is to examine empirically the notion that since service activities now show above-average growth and are above-average concentrated in big cities, they pull economic development towards big cities. This is shown not necessarily to be the case, indeed it may be called ‘the structural fallacy’. Shift-share analyses in France and Denmark in the last decades of the twentieth century show that shifts out of the big cities more than counter-balance their structural advantages. However, this is not necessarily the case everywhere or in all periods. A third approach is, using the concepts and findings of the first two, to discuss the role of services in the development of rural areas, small and medium-sized towns, and big cities in Western Europe.