But caution is needed when looking at the statistics, as there are also pitfalls with the local GDP per head figures which should be borne in mind.

To begin with, they under-estimate the wealth and spending power of areas where there are large numbers of retired people. Since these people earn little or no income from the production of goods and services, they are not counted in local GDP calculations, which are based on the measurement of incomes.

In the second place, as a matter of convention, GDP statistics at regional and sub-regional basis allocate incomes to the places where people work rather than to where they live. This means that economic activity in areas to which large numbers of people commute can be exaggerated.

The South East provides a good example of how areas of relative poverty and deprivation can exist close to zones of high affluence, and highlights the limited extent to which economic activity and wealth percolates from richer to neighbouring poorer areas.

Despite the growing congestion, high house prices and office rents, and pressure on open spaces and public services, there has not been a mass exodus of businesses forsaking the Thames Valley corridor in favour of the seaside resorts of the Kent and Sussex coast.

Experience suggests that, in many instances, market forces are not the key drivers behind location decisions. In other words, even if a business could save money and enhance its profits by moving to a different location, it will not necessarily do so.

While the risks associated with the potential loss of key staff and the ready availability of suitable replacements is an important consideration, there is also ample evidence that 'cluster' effects are important.

Entrepreneurs feel much more comfortable when they are close to others in the same line of business. For one thing this means that there will be a pool of skilled labour from which they can recruit. It also means that they will have better access to the support services which are common to firms in that sector.

Fostering the creation of new business clusters is a common theme in the strategies of the Regional Development Agencies (RDAs). Their aim is to focus resources on a few carefully chosen locations, where they can help to develop the basic infrastructure, financial incentives and links with local universities and other research facilities, to attract a critical mass of businesses.

The inadequacy of transport links is usually cited by the business community as a factor which hinders development in some localities. It is an argument which has been used over many years to promote the building of new roads. Experience suggests that the link between improved transport and economic development is far from clear-cut.

In some cases, the building of a new road brings unwelcome development by making it easier for people to commute over longer distances. The construction of the M40 through rural Oxfordshire and Warwickshire in the early 1990s is a good case in point.

In peripheral areas, improved access does not always attract businesses in, but simply makes it easier for residents to leave, so adding to the problems of skill shortages.

It is now more widely accepted that better transport links alone are not the panacea for local economic ills. Poorly performing areas of the country, such as Cornwall, the North East and the Kent and Sussex coast cannot be revived simply by building motorways.

Transport needs to be part of a much wider approach, one which ensures that potential inward investors will not only have mobility, but also access to all the other resources which they will need, and preferably within the framework of viable business clusters.