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

Abstract

Over recent years, socio-economic restructuring has tended to undermine the traditional functions of small rural towns. Empirical evidence also suggests that significant proportions of economic transactions are carried out through the regional, national and international economy. Establishing the degree to which a settlement is integrated into its locality provides an indication of its contemporary functions and 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.