Traditional Strategies and Tools of Local Economic Development

Business retention, revolving loan funds, tax increment financing, tourism, bond issuance, PILOTs, tax abatement…

All are examples of the core strategies and tools utilized every day by most economic developers. Sometimes controversial, oftentimes boringly commonplace, often misunderstood– and almost always in need of some explanation as to why they work and why economic developers use them.

In their day, they might have been sexy like clusters and innovation–but age and gravity has taken their toll. They are now pervasive. Like two aspirin, they work wonders but who cares anymore. We do!

The problem with our traditional strategies and tools is that people mess with them. In particular media,  academics and sometimes the research institutes and think tanks. Often when they translate our strategies and tools into academic and policy research, the description and analysis of these strategies and tools gets distorted–sometimes downright manipulated. Does the expression, hatchet job come to your lips?

Our initial focus is tax abatement. These days, those are fighting words, but as the old-time economic developers know, tax abatement was never very popular and was always under attack. Take a gander at how academic research has dealt with tax abatement. Over the next few decades, the Curmudgeon will also take a look at eminent domain, use of universities as an economic development tool, and maybe economic development zones, and real estate-based economic development.

Don’t fret over Traditional Strategies and Tools of Local Economic Development.

Articles in 'Traditonal Strategies and Tools of Economic Development'

As Two Ships: the History of American State and Local Economic Development Since 1789 to the 1980’s

American state and local economic development (ED) has been around since Day One (1789) of the American Republic—it didn’t start in 1937, 1945 or 1965. Recognizable forms of many current ED strategies, tools and programs can be found by the 1880’s. My recently-published “History of American State and Local Economic Development, 1789-1990: As Two Ships Pass in the Night” (As Two Ships) presents our historical evolution from George Washington to 1990—all 752 pages of it. My next two issues of the Journal will present twelve observations (six per issue) drawn from As Two Ships. I will infuse them with additional insight to provide perspective and a foundation for future issues of the Journal and make them easier to apply to current events. These observations will provide a background and a base from which to rethink one’s ideas regarding the history–and purpose–of American state and local economic development. They will open you to new ways on how to approach your job, research, and your profession.
This issue will discuss the core fundamentals of my history and also will introduce what the book labels the “Chapter One Model” .

Main
Article
Executive
Summary

Breaking Up [Paradigms] is so Hard-to-Do

President Trump’s challenge compels us to confront the Forgotten People problem swept under the rug by economic developers current paradigms: innovation, knowledge-based economics, university-led economic development, and “gazelle” clusters and occupations. The January article redefines Forgotten People, presents an alternative way to “do” economic development at the state and local level and offers four thought-provoking programs that involve nothing less than a new approach to economic and community development–a community-based, community rebuilding, Back to the New Deal, service sector-focused skills-development employment.

Main
Article
Executive
Summary

Lessons from the Past for Urban Policy in the Era of Trump

BY RICHARD COWDEN
The stunning election of Donald Trump as president throws the future of urban policy into doubt. During the campaign he promised to bring new jobs and improved infrastructure to the inner cities, but so far he has furnished no details. Some of the strategies carried out by cities and states in the past may offer the incoming administration some guidance.

Main
Article
Executive
Summary

SLOW GROWTH AND POPULIST PUSHBACK: The Times They are a ‘Changing

“The times they are a-changing”.The article outlines the link between populism and slow economic growth. Free trade is the accepted paradigm of global finance and trade. Free trade is characterized by a “lag and shift” dynamic that has made life for our “Forgotten People, the working and lower classes. hell, hence the rise of a hostile populism. Look for no real help to those who are hurt by free trade from these ideologies and paradigmatic economic development strategies. Class and culture distinctions create a serious gap between conventional economic development strategies. Economic development can close that gap by offering jobs, training, and place-based redevelopment to improve the lot of the Forgotten People.

Main
Article
Executive
Summary

Let’s Take a Stroll Down Memory Lane: Victor Gruen and the Central Business District

City versus suburbs used to be a very big issue in economic development. It still is! So let’s take a stroll down economic development’s “memory lane”–to the days of 1950’s CBD collapse and resurrect its then- potential savior, the “father of suburban malls”, Victor Gruen. Gruen tried to save the CBD and revitalize the central city–but that has been fogged over by time. What can we learn from Gruen? Why did he fail? What lessons can we glean from these very important years when suburbs became suburbs and central cities assumed their present status in our metro areas?

Main
Article
Executive
Summary

Community Development in the Ghetto: a Review of Bennett Harrison’s Survey of Ghetto-Based Community Development

In this review, I question whether community development in deeply depressed neighborhoods involves a dynamic that further complicates success of its initiatives. That dynamic is race. More often than not, community development initiatives occur in predominately African-American low-income neighborhoods. In this article I raise the issue as to whether the residents of these neighborhoods prefer assimilation over their current neighborhood–a place that houses the “community”. What if a sizeable percentage of residents do not want to assimilate, or define their personal assimilation in such ways that render assimilation difficult. Do recent community mobilizing movements potentially affect the success of current and future community development initiatives by encouraging place-based solutions for African-Americans. Assimilation in such a context becomes a cultural cul du sac that threatens to create a perpetual ghetto.

Main
Article
Executive
Summary

Community Development: It’s Time to Question the Basics

This issue offers an unasked for critique of several community development issues/principles that reflects an outsider’s sense that this very significant economic development approach is at a crossroads. My recommendation is that community developers might rethink of a couple of long-standing conceptual pillars which have come to be dysfunctional. As a benchmark I will dredge up a perspective, now almost seventy years old, that I believe will be helpful.

Main
Article
Executive
Summary

What Can ED Learn from Baltimore’s Sandtown?

Let’s turn the recent Baltimore riots into a teachable hour for economic developers. Sandtown, Freddie Gray’s neighborhood, offers a unique and fascinating perspective on neighborhood-level, people-based economic development. So let’s task ourselves with the following objectives: (1) briefly outline the two types of community development that were applied to Sandtown; and (2) review post 1990 Sandtown community development(s), participants and their objectives; (3) briefly critique Sandtown-style community development, finally conclude, and send you off on your merry way.

Main
Article
Executive
Summary

Questioning Paradigms: Manchester England and the Plight of Legacy Cities

Manchester and other northern UK cities share many of the same problems as our Northeast and Midwest Great Lakes legacy cities–they have lost a great deal of their economic meaning because of changes in logistics and deindustrialization. At the moment their national government has launched a major effort to promote “northern cities” economic development. What can we learn from them?

Main
Article
Executive
Summary

Questioning the Value of Economic Multiplier Estimates

What if anything do estimated economic multipliers really mean? What are some basic principles policymakers should use when thinking about the prospective impact of new projects in their communities? Click Questioning the Value of Economic Multiplier Estimates and see what Edward G. Keating, Irina Danescu, and Robert Murphy from the RAND Corporation have to say?

Main
Article
Executive
Summary