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Local Economic Development
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Local Economic Development
Analysis, Practices, and Globalization

Second Edition


December 2008 | 328 pages | SAGE Publications, Inc
Comprehensive coverage of traditional economic problems and issues are strengthened in this textbook by the recognition that the economic perspective should be supplemented by insights from other social sciences.

Features of this new Second Edition include:

- concepts, theories and tools are emphasized rather than specific programmes

- traditional topics such as location of activities, growth and development, economic structure, land use, neighbourhood development, and governance are presented in ways that connect theory to 'the ground' realities

- economic problems including transportation, poverty, immigration, education, urban management and housing are covered within the context of regional development

- numerous quantitative tools including location quotients, shift/share analysis, local multipliers, input-output analysis, statistical modeling, cost/benefit studies, discounted cash-flow analysis, among others, are described in an easy-to-understand manner.

 
Chapter 1. Local Economic Development in a Global Market
How Economists View the World

 
Models and Assumptions

 
Individual Behavior and Utility Maximization

 
Ideological Perspectives on Market Operations

 
How Markets Work

 
Supply and Demand

 
Supply, Demand, and Efficiency

 
Markets Are Not Always Efficient

 
The Role of Profits

 
Economic Development Defined

 
Careers in LED

 
The Nature of Regions

 
Types of Regions

 
Local, National, and Global Economic Development

 
 
Chapter 2. Business Location, Expansion, and Retention
Locational Factors

 
Inertia

 
Transportation Cost Minimizing Models

 
Production Costs

 
National Political Climate and Stability

 
Opportunity Creation

 
The Decision Making Process

 
Motivations

 
Practical Limitations on the Choice Process

 
Steps in the Corporate Site Selection Process

 
Changing Relative Importance of Locational Factors

 
Surveys of Location Factors

 
Survey Findings Past to Present

 
Conducting Business Retention and Expansion Programs

 
 
3. Markets, Urban Systems, and Local Development
Demand and Market Areas

 
Demand in a Spatial Setting

 
Competition for Markets

 
Threshold Demand and Range

 
Determinants of Market Size

 
The Urban Hierarchy and Urban System

 
Central Places

 
Goods and Services According to Urban Rank

 
Changing Urban Patterns

 
An Evaluation of the Central-Place Approach

 
Considerations Extraneous to Central-Place Theory

 
Transportation Costs

 
Market Overlap, Rate Absorption, and Price Discrimination

 
Product Differentiation

 
Agglomeration Economies

 
Institutional Factors

 
Non-employment Residential Locations and Commuting

 
Empirical Evidence

 
Globalization and Urban (City) Systems

 
How to Measure Areas of Influence

 
Survey Techniques

 
Reilly’s Law of Retail Gravitation

 
Probabilistic Models

 
Retail Spending

 
An Example

 
Hinterland Expansion Strategies

 
 
4. Economic Interdependence and Local Structure
Agglomeration Economies

 
Internal Agglomeration Economies

 
Direct Sales Purchases Linkages

 
Localization Economies

 
Urbanization Economies

 
Recap

 
Cluster Analysis

 
Measures of Economic Structure

 
North American Industrial Classification System (NAICS)

 
Location Quotients

 
Estimating Export Employment with Location Quotients

 
Surveys to Determine Export Activities

 
Coefficients of Specialization

 
Occupational Structure

 
Other Aspects of Regional Structure

 
 
5. Regional Growth and Development
Stages of Growth

 
Industrial Filtering (Life Cycle Model)

 
Adding New Work to Old

 
How Do Cities Move from One State to the Next?

 
Circular Flow Diagram

 
Elements of the Circular Flow Model

 
Equilibrium and Change

 
The Multiplier

 
The Export Base Theory of Growth

 
The Formal Income Model

 
How to Operationalize the Export Base Approach

 
Impact Studies and Export Base Forecasts

 
Critique of the Export-Base Approach

 
Primacy of Exports

 
Import Substitution

 
Productivity

 
Exports Not Always Exogenous

 
Small versus Large Regions

 
Feedbacks among Regions

 
Non-basic Activities May Not Increase

 
Long-Run Instability of the Multiplier

 
Excessive Aggregation

 
Supply-Side Approaches

 
Intermediate Inputs

 
Entrepreneurship

 
Capital

 
Land (Environmental Resources)

 
Labor

 
Supply and Demand Side Approaches: A Synthesis

 
 
6. Additional Tools for Regional Analysis
Shift and Share Analysis

 
An Application

 
Critique

 
Econometric and Simulation Models

 
Econometric Models

 
Caveats

 
Importance-Strength Analysis

 
Input-Output: Analysis

 
The Transactions Table

 
The Table of Direct Coefficients

 
The Table of Direct and Indirect Coefficients

 
Input-Output Applications

 
 
7. Institutionalist Perspectives on Local Development
External Benefits from Economic Development

 
Job and Income Creation

 
Fiscal Improvement

 
Physical Improvements

 
Who Benefits From Growth?

 
Characteristics of Resource Supply

 
Opponents of Growth

 
Subsidies, Competition and Economic Development

 
Is Local Economic Development a Zero Sum Game?

 
Inefficiency and Oversubsidization

 
Discretionary versus Entitlement Subsidies

 
Cost Minimization versus Human Capital Strategies

 
Social Capital and Economic Development

 
Generic Economic Problems and Social Capital

 
Ambiguous Reception of Social Capital

 
Social Capital and Local Development Strategies

 
Using Social Capital to Mitigate Economic Development Conflicts

 
Social Network Analysis: Getting the Right People to the Table

 
Targeting Development Efforts

 
Cluster-Based Economic Development

 
 
8. Local Economic Development in a Flattening World
Models of Trade and Resource Flows

 
Comparative Advantage

 
Resource Mobility

 
Economics of Migration

 
Retiree-Migrant Development Strategy

 
Mobility of Capital

 
Innovations and Ideas

 
Spatial Diffusion

 
Implications for Regional Development

 
Mobility and Development Policy

 
Jobs-to-People versus People-to-Jobs

 
Immigration and Urban Development

 
 
9. Land Use
What Gives Land Value?

 
Land Rents and Value

 
The Nature of Rent, Productivity and Access

 
Highest and Best Use

 
The Land Development Process

 
Developer Goals

 
The Market Study

 
Environmental Impact Statements

 
Profit Feasibility

 
The Development Decision

 
Implications of Financial Analysis for LED

 
Land-Use Patterns

 
The Monocentric City Model

 
The Desity Gradient

 
Roads and Axial Development

 
Agglomeration and the Multiple-Nuclear City

 
Speculation

 
Changing Land Use Patterns

 
Evaluating Metropolitan Spread (Urban Sprawl)

 
Land Use and Economic Development Tools

 
Zoning and Its Critics

 
Flexibility and Land Use Regulations

 
The Eminent Domain Controversy

 
Rights to Land and Economic Development

 
 
10. Housing and Neighborhood Development
Fundamentals of Housing Economics

 
Hedonic Pricing

 
Uncertainty, Market Imperfections, and Competition

 
Residential Location and Neighborhood Change

 
The Filtering-Down Theory

 
The Trade-Off Model

 
 
The Cultural Agglomeration Model
The Tiebout Model

 
The Aggregate Economic Fallout Model

 
Initiating and Perpetuating the Change Process

 
Housing Policy Issues

 
Rent Control versus Market Forces

 
Income Support versus Housing Assistance

 
Supply versus Demand Side Assistance

 
Ghetto Dispersal versus Ghetto Improvement

 
Dwelling-Unit versus Neighborhood Development

 
Linkage Between Local Housing and Global Financial Markets

 
Retail and Commercial Neighborhoods

 
The Social Economy of Neighborhoods

 
Community Development Corporations

 
Cooperatives

 
Community Gardens

 
 
11. Poverty and Lagging Regions
The Nature of Poverty

 
 
Conceptual Approaches
Demographics of Poverty

 
Spatial Concentrations of Urban Poverty

 
Regional Linkages: The Spread and Backwash Effects

 
Empirical Studies of Spatial Linkages

 
Spatial Linkages and Theories of Spatial Poverty

 
Policy Issues

 
Strengthening Linkages

 
Improving Productivity

 
 
Addressing Wage Rigidities
Employment Guarantee Schemes in India

 
Income Support

 
 
12. Local Governance, Finance, and Regional Integration
Spatial Perspectives on Government Functions

 
Distribution and the Race to the Bottom

 
Local Allocation

 
Public Transportation – An Example

 
Size and Scope of Local Governments

 
Economies and Diseconomies of Scale

 
Decision-Making Costs

 
Improving Government Efficiency

 
Using Prices and Fees

 
Local Taxation and Economic Development

 
Accountability

 
Intergovernmental Competition

 
Intergovernmental Grants and Coordination

 
Rearranging Functions

 
Privatization

 
Market Based Reforms in Education

 
Fiscal Impact and Benefit-Cost Studies

 
Fiscal Impact Studies

 
Benefit-Cost Analysis

 
 
13. Local Economic Development Planning
The Future and Local Development

 
Concern with Values and Attitudes

 
Technological Change

 
Systems Orientation

 
Importance of Timing

 
Planning Perspectives on Development Policy

 
The Planning Process

 
Limits of Planning

 
Planning and Future Studies Tools

 
Delphi Forecasting

 
Games

 
Scenarios

 
Environmental Scanning

 
 
About the Author

Concepts, theories and tools of Local Economic Development are discussed in this text book without neglecting the respective local institutional and cultural influences

Mrs Susanne Hilland
Wirtschaft 2, Heilbronn University
October 8, 2010
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ISBN: 9781412964838
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