Local Economic Development Overview

Principles

Definition

Local economic development is a field of research and practice that investigates strategies and interventions aimed at improving the economic well-being of a specific sub-national territory. It focuses on enhancing competitiveness, fostering job creation, attracting investment, and supporting local businesses to achieve sustainable and inclusive growth within a defined geographic area.

Ontological type

Core Objectives

Policy Instruments

Governance and Stakeholders

Key developments

Key Figures

Place-Based Foundations era

George R. Zodrow [1], with affiliations including University of California, Berkeley [3] and Rice University [4], contributed to the era's analysis of local public finance and governance. His key contributions in this era include analyzing Pigou, Tiebout, property taxation, and the underprovision of local public goods [7], which helped explain how fiscal incentives shape the provisioning of local public goods under place-based development. Wolfgang Streeck [2], with affiliations at University of Wisconsin–Madison [5] and University of Oxford [6], advanced understanding of the governance and structural dynamics underlying regional development. His work Industrial Districts and Local Economic Regeneration [8] highlighted how industrial districts generate localized external economies and inform place-based development strategies in the 1990s.

Knowledge-Driven Regionalism era

Michael E. Porter [1], associated with Harvard University [3] and Boston University [4], stands as a central figure in the Knowledge-Driven Regionalism era for analyzing how local clusters drive regional competitiveness. In his 2000 paper Location, Competition, and Economic Development: Local Clusters in a Global Economy [7], Porter argues that dense local clusters shape competitiveness in a global economy, a claim further developed in The Economic Performance of Regions [8] (2003) to map how regional assets translate into performance. Peter Maskell [2], affiliated with the University of Birmingham [5] and Oxford Brookes University [6], emerges as a key contributor to the knowledge-based view of spatial clustering in this era. His papers The Elusive Concept of Localization Economies: Towards a Knowledge-Based Theory of Spatial Clustering [9] (2002), Towards a Knowledge-based Theory of the Geographical Cluster [10] (2001), and Myopia, knowledge development and cluster evolution [11] (2007) collectively advance a framework for absorptive capacity and local learning essential to Knowledge-Driven Regionalism.

Relational Spatial Governance era

Andrés Rodríguez‐Pose [1] is associated with Harvard University [3] and Columbia University [4] during this era. The 2012 paper The Case for Regional Development Intervention: Place‐Based versus Place‐Neutral Approaches* [7] argues for targeted place‐based interventions to reduce urban–rural disparities, and the 2018 paper Toward Economically Dynamic Special Economic Zones in Emerging Countries [8] discusses how dynamic SEZs can mobilize investment and skills to catalyze regional growth. Philip McCann [2] is associated with University of Groningen [5] and University College London [6] during this era. McCann's contributions in this era include The Case for Regional Development Intervention [7], illustrating how place-based policy can coordinate spatial investments and productivity to address regional disparities.