Why Is Local Economic Development (LED) Key to Sustainable Development?
Editor’s Note: This is Part 1 of a two-part series on ME&A’s LED services. Part 2 is on how ME&A applies LED regionally and locally.
Why does ME&A specialize in developing and implementing programs in Regional and Local Economic Development (LED)?
ME&A specializes in LED because finding the answers for sustainable development of underdeveloped or developing nations and peoples requires a thorough understanding of the impediments to and potentials for economic development, so that creative solutions can be designed and delivered. LED is an important, perhaps the most important, key to sustainable growth, the reduction of poverty, the elevation of indices of well being of a people and society.
Focusing on local economies in development work is crucial because local economies are the only “true” economies. In contrast, a national economy is a macroeconomic generalization, defined as the sum of a nation’s production of goods and services, that is a useful one for purposes of public policy development, measurement, and to design economic interventions. But changes in national economies only happen as the economies of cities and their regions change.
How do you define economic development and LED?
Jane Jacobs, the venerable urbanist and economist says that development is “significant qualitative change.” Economic development then is qualitative change in the economy.
LED is the process by which public, business and non-governmental sector partners work collectively to create better economic conditions for a locality and its region. The objectives of the LED process can be economic growth, business creation, employment generation, or combinations thereof. The key to the process is the public-private partnership between local governments, private businesses, business associations, NGOs, and other stakeholders.
Who makes local economic development happen?
In a market economy, the engines of economic development are primarily private businesses that create wealth and jobs. But the private sector cannot succeed without favorable business conditions in which to thrive and grow. Local governments and other public sector actors have a major role to play in helping to establish and maintain those favorable business conditions so that firms in the city’s region can compete successfully with firms from other regions.
What are some other advantages of a focus on LED?
- LED fosters efforts towards decentralization, and is antithetical to government centralization.
- LED supports civil society development. LED is a tangible process through which local government, private businesses and their interests, NGOs, labor interests and private citizens can work together collectively to develop their economic environment
- LED supports democracy building because it places mayors and other locally elected officials at the center of economic development policy-making for the community, where they belong.
- LED relates to community development programming and essentially all development programs related to infrastructure, public facility and social program delivery. All either contribute to or are affected by the local economy.
What books, manuals, papers and other resources can you read to learn more about LED?
Belton, Hugh, “Becoming an Entrepreneur: A Handbook for Assessing Business Opportunity” (1996) An ME&A manual for business development
Blair, John P., “Local Economic Development—Analysis & Practice”, Sage Publications, 1995
England, Thomas C., “Strategies for Creating Public Private Partnerships for Local Government—The Role of the Mayor (1990). Presentation at the 4th Great Cities of Americas Conference, Buenos Aires
Fairbanks, Michael, and Lindsay, Stace, “Plowing the Sea: Nurturing the Hidden Resources of Growth in the Developing World,” Harvard University Press (1997)
ICMA, “Building Citizen Involvement—Strategies for Local Government” (1995) A training handbook.
Jacobs, Jane, “Cities and the Wealth of Nations,” Random House, 1984
Jacobs, Jane, “The Economy of Cities,” Random House, 1969
Jacobs, Jane “The Nature of Economies,” Random House, 2000
Kemp, Roger L., (editor), “Strategic Planning in Local Government—A Case Book,” American Planning Association (1992)
Nichols, J. Hugh, “A Strategic Economic Development Planning Process for Local Government in Albania, ” USAID Project (1996)
Peirce, Neal R., “CITISTATES—How Urban America Can Prosper In A Competitive World,” Seven Locks Press (1993)
National Council for Urban Economic Development, “An Introduction to the Economic Development Process,” (1980)
Porter, Michael E., “Competitive Strategy: Techniques for Analyzing Industries and Competitors,” Free Press (1998)
Porter, Michael E., “The Competitive Advantage of Nations,” Free Press (1998)
Rusk, David, “Cities Without Suburbs,” Woodrow Wilson Center Press (1993)
Timmons, Jeffrey, with Smollen and Dingee, “New Venture Creation: Entrepreneurship In The 1990’s,” Irwin (1985)
The Urban Institute, “The Community Builder’s Handbook, ” Urban Land Institute (2000)
Urban Development Unit, The World Bank, “Local Economic Development: LED– Quick Reference,” The World Bank, 2002