What is the backwash effect?

What is the backwash effect?Gunnar Myrdal in 1956 said that regional differences are the natural outcome of economic development and the inevitable result of market forces. No one region can prosper, he said, without adversely affecting the prosperity of another. Economic growth takes place initially where there are such natural advantages as a source of fuel or a supply of raw materials. Once in existence, this region of economic development sets in motion the process of cumulative causation. Myrdal called the movement of wealth from poorer regions to the central rich region the backwash effect. It takes place because of better facilities and opportunities offered by the growing region.

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