Regional growth

Specifically, when the economy moves from dispersion to agglomeration, the rate of innovation tends to increase. Consequently, if the growth effect triggered by the agglomeration is strong enough, then even those who remain in the periphery will be better off. Hence it can be argued by Rawls' principle that there is no real conflict between growth and equity here, in the sense that all workers are made better off. It should also be stressed that this Pareto-optimality property does not require any transfer whatsoever: it is a pure outcome of market interaction. (Masahisa Fujita and Jacques-François Tisse, 2009, p. 116)