“Economic development is the expansion of capacities that contribute to the advancement of society through the realization of individual, firm and community potential. Economic development is measured by a sustained increase in prosperity and quality of life through innovation, lowered transaction costs, and the utilization of capabilities towards the responsible production and diffusion of goods and services. Economic development requires effective institutions grounded in the norms of openness, tolerance for risk, appreciation for diversity, and confidence in the realization of mutual gain for the public and private sector. Economic development is essential to creating the conditions for economic growth and ensuring our economic future.” (Maryann Feldman et al., “The logic of economic development: a definition and model for investment” article in Environment and Planning C: Government and Policy.
As typically practiced, economic development largely consists of efforts to attract businesses by persuading them to relocate into a state or community. This approach is generally a zero-sum game and often results in a net economic drain because of subsidies and/or lowered tax incentives.
Over the last couple of decades, research has brought a much better understanding of successful approaches to economic development, and it is now increasingly acknowledged to consist of a much broader set of integrated practices, as defined in the quote above. Northeast Ohio also has worked diligently to create a more integrated conceptualization of economic development and has gradually expanded the tool chest through organizations such as chambers of commerce and entities including the Fund for our Economic Future, as well as others focused on specific aspects of the economy, such as MAGNET in the manufacturing sector.
In this vein, Akron, in particular, was recognized by the Brooking Institution’s Metro Program for its well-integrated and focused approach. In its report, “Institutionalizing Inclusive Growth: Rewiring Systems to Rebuild Local Economies,” Brookings outlines what Akron has done to develop key entities such as the Elevate Akron initiative, the Bounce Innovation Hub and the Akron Office of Integrated Development, which coordinates efforts. Brookings notes that Akron again recognizes the unique assets of the Akron Polymer Cluster and its long-standing relationship to the University of Akron’s School of Polymer Science and Polymer Engineering, and the University of Akron Research Foundation — all which are sources of continuing innovation and opportunities for economic growth.
Brookings highlights Akron to demonstrate economic development is multifaceted — it is very much about capacity-building that is resilient and innovative and involves partnerships among companies, universities and government.
This means that communities, regions and states need to look and act more broadly than just attempting to attract new companies. It means not only looking to developing the skills of those already in our communities but thinking and acting critically about talent attraction — bringing a stronger base of talent into our communities, talent that can energize our base and infuse new ideas that become the basis of new, locally grown companies, products or services.
It means seeking innovations, not just within single enterprises but from wherever new, relevant technologies and ideas can be sourced. It means recognizing talent is attracted by, and thrives in, vibrant communities such as Akron that have a rich mixture of cultural and economic resources. ●
Luis M. Proenza is President Emeritus of The University of Akron