ABSTRACT
Public expenditure accounts for some 39 per cent of Britain’s gross national product (GNP), and so its distribution might be expected to have considerable effects on the relative prosperity of the regions. The public sector also accounts for substantial numbers of jobs, and in some areas it is a key source of paid employment; regions such as North East England and South Wales have been termed ‘state managed’ (Hudson, 1988) or ‘nationalized’ (Cooke, 1987) regions, in that their economic prospects have become inextricably bound up with state policies and expenditures. But it would be unwise to focus solely on regions like the two cited, thus emphasising the state’s direct role as an employer through the nationalised industries, because this would neglect the state’s indirect role in supporting employment, through various ‘hidden’ subsidies and policies, which are also considered here.
