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Economic Development Broadly Defined

June 15, 2011

I love economic development. It is a big, wide, wonderful field that plays a critical role in our society and affects people’s lives in a profound way. Jobs and corporate investment create wealth that citizens can use to purchase goods and start new businesses. Strong economies at all levels of government produce tax revenues, which allow governments to achieve their missions in education, infrastructure, citizen welfare, and service delivery. As an academic, I like that economic development encompasses many different disciplines, including economics, business, political science, public administration, marketing and communications, sociology, community planning, education, and many more. As a practitioner, I like that it involves a diverse range of actors, including local governments and development agencies, chambers of commerce, non-profit community development agencies, private enterprises, consultants, state development agencies, and the federal government. Also, it takes place on varying geographic levels (neighborhoods, cities, metropolitan areas, states, multi- state regions, national, and international). As an area of study and work, it offers great challenges and abundant opportunities.

“Economic development” has been defined as “the process by which a community creates, retains, and reinvests wealth and improves the quality of life” (David Dodson, MDC, Inc.). When many hear the term “economic development”, they think about recruiting industry. But industrial recruitment is not the only, or even most important, determinant of a strong local economy. Bringing economic health and prosperity to a community requires much more than just enticing a company to open a new plant in the local industrial park. Business retention and expansion, small business and entrepreneurial development, tourism and retiree attraction, for example, generally receive short shrift compared to industrial recruitment.

More importantly, prosperous local economies are built upon the foundation of strong communities. Community and economic vitality is largely determined by the quantity of leaders in a community and how, individually and collectively, they talk, decide, act, and interact with one another. This focus on the community and civic infrastructure contrasts with the prevailing view of economic development dominated by issues of business marketing, financial incentives, and recruitment. We often overemphasize marketing and sales (industrial recruiting) and pay too little attention to product development (improving the quality of life in the community). While industry recruiters certainly play important roles in the economic development of their communities, so do the high school coach, the hospital administrator, the plant manager, the Sunday school teacher, the city beautification council, and the citizen who organizes a town meeting.

One thing I like about the definition of economic development used here is its emphasis on the concept of “quality of life”. Indeed, the ultimate goal of economic development is to improve the quality of life for the people who live in a community (state/nation). It is a means to an end, not an end in itself. Quality of life is also an important site selection criterion for many major employers. Companies are attracted to, and want to stay in, communities that are good places to live, work, and conduct business. Top quality schools, exceptional medical care, diverse recreational opportunities, good roads, clean water, effective public safety, and much more, make a location appealing. Therefore, preserving, promoting, and improving a community’s educational system, natural environment and community aesthetics, and civic life must be integral components of its economic development strategy.

Finally, it is important to note that not all economic growth is desirable. A proper conception of economic development must embrace the concept of “sustainability” — meeting the needs of the current generation without compromising the ability of future generations to meet their own needs. That is, our goal should be to grow employers, jobs and incomes without compromising our natural and other assets.

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14 Comments leave one →
  1. Beverly Callaway permalink
    June 24, 2011 8:04 am

    Great article, Dr. Sumners!!! Very insightful!

    Hope to see you soon!

    Beverly Callaway

  2. Tonia permalink
    December 2, 2011 5:04 pm

    Is Economic Development all about improvement in the sectors of the Economy?

  3. Mehrdad permalink
    February 3, 2012 5:26 am

    Thanks for the post, Sir, very instructional.

    I have been struggling with the notion, ‘basic’ living standard (or quality of life). Do you see some timeless, non-normative conception for basic living standards?

    I have studied several definitions (including the one here: http://development-definition.net/). I am still unsure if we can think of some universally-agreed level for basic living standard. Any comment will be appreciated.

  4. assfaw tadele permalink
    March 30, 2012 12:49 am

    Just, i need economic development module

  5. Ganiu idrees permalink
    September 26, 2012 6:12 am

    Wel, i surmon the courage of my predecesor and their effort to enghlite people about the ECONOMIC DEVELOPMEN.so in addition to the previous analysis, i said: economic developmen is the process whereby the level of national production(national income)or per capital income increases over a period of time. The sole aim of economic development is to raise the standard of living and overall well being of the masses.

  6. fatma permalink
    December 18, 2012 3:30 pm

    Thank you ……… great artical

  7. Ned Luce permalink
    January 20, 2013 5:46 pm

    I assume that you believe in the UN’s Agenda 21 because the last paragraph is from Agenda 21. The purpose of Agenda 21 is to destroy the free enterprise system and eliminate all private property and where the ‘ collective’ is more important than the individual.

  8. March 21, 2013 6:34 pm

    I have read so many posts on the topic of the blogger lovers however this piece of writing is actually a pleasant piece
    of writing, keep it up.

  9. Barr. Emmanuel Ekpo permalink
    July 31, 2013 12:25 pm

    Your research is indeed precise and vivid. Please attempt to add factors confronting or limitating economic development. Due regards

  10. saad ullah khan bs economics permalink
    November 6, 2013 1:08 am

    thnx great

  11. saad ullah khan bs economics permalink
    November 6, 2013 1:09 am

    amazing artical

  12. Fardus Yusuf permalink
    May 26, 2014 3:38 am

    its so important to achieve development because quality of life based on it…
    good article thankz

  13. July 11, 2014 12:05 pm

    thanks for this article. very informative and inspiration material for small town like us.

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