Local and Regional Development - Report Example

Critically discuss the meaning of ‘local and regional development’ In order to respond to the demands of current social, financial and technological development, countries around the world, had to formulate specific policies that would help towards the improvement of conditions of life and the promotion of communication between the states and the populations. This effort continues for many years and still the governments of countries globally try to achieve a high level of financial and technological development in order to meet the requirements set by the global political and financial scheme (patterns of technology and financial structures that characterize the modern society). Towards this direction, Knapp et al. (1987, 1) found that “since 1970 the world economic environment has experienced considerable changes; this has become manifest through frequent alternations in currency exchange rates, interest rates and commodity prices; the latter have led industrial organisations to make decisions increasingly frequent with respect to changes in investments, stocks, wages and labour requirements”. In other words, the main ‘tools’ for the achievement of an ‘advanced’ level of life (as imposed by the practices promoted through the globalization) have been the extensive restructuring of the labour relationships and the alterations in the ethics and the practices applied in the investment sector. Regarding the above it has been found by Gouldson (2000, 25) that “the past two decades have seen a revolution in approaches to regional and local economic development across Western Europe whereas the locus of responsibility for promoting structural change and development has moved from central government to sub-national tiers of government”. In the same context, Thorns (1992, 137) supported that “regional policies and programmes have undergone considerable change over the last thirty years; the 1960s and 1970s were decades when state intervention was present and thus a range of regional initiatives and restructuring of both activity and forms of government existed; the 1980s, however, has been a decade when the development of regional programmes has tended to weaken as a more market-oriented strategy became dominant in most countries around the world”. However, because of the complexity of the governmental structures in Europe (each country has its particular system of governance even if there are common patterns of administration due to the existence of the European Union), it has been very difficult for the countries involved to follow a common way of development. Rather, they have chosen to develop their own social and financial principles trying to retain their ‘national identity’ and their traditions. On the other hand, the political and the economic pressures had been really intensive (mostly due to the international political and financial instability) and as a result “new forms of territorial management have arisen, partly through the top-down devolution and deconcentration of national government powers and partly from ‘bottom-up regionalism’, as local and regional communities asserted their economic, political or cultural identity and autonomy” (Gouldson, 2000, 25). Under these terms, it is stated by Bookman (1991, 21) that “nations are characterized by regions of varying levels of development and differing economic bases, both of which result from different specializations; these factors in turn determine the inter-regional trade patterns”. The above view has to be criticized regarding the issue of the role of the international trade in the regional and local development. Indeed, trade within the international community is a significant criterion for the development of a particular state. However, it is not the only criterion. There is the case that a state has achieved a noticeable development in other sectors, like the culture and the science. Its position in the global marketplace should not be therefore regarded as the most important criterion for the evaluation of this country’s position in the international community. Of course, the performance in the international trade is a positive sign for the financial development of a particular country but it should not been positioned at the top of the hierarchy when referring to the list of the factors that characterize a state’s financial, cultural and social performance. As a consequence, international trade should not be the exclusive or the decisive criterion for the design and the application of plans of local and regional development. On the other hand, in practice, most states around the world consider international trade as an extremely significant criterion regarding their position in the international community, and for this reason they usually adopt regional and local plans of development that serve the relevant target (attraction of foreign capital, enhancement of country’s position within the international marketplace). When an appropriate plan of local or regional development is designed and applied in a specific area, there are usually financial issues – funding of the project – that needs to be resolved between the central government and the local authorities. A situation of economic dependency may be resulted in this case, a phenomenon which is common for “most regions, irrespective of their level of development Indeed, economic dependency is not inversely related to the level of development of a region, since the economies of the more developed regions may be fueled by extra-regional demand, while a less developed region may have weaker extraregional links to the national economy merely on the basis of its less active economy” (Bookman, 1991, 21). This dependency is not necessarily negative. However, it can create constraints during the application of the particular plans especially when there are points that need to be differentiated in order for the plan to better serve the needs of the particular region. Regarding this issue it has been supported by Eskelinen et al. (1998, 24) that “some regional or national settings might turn out to be more predisposed than others to support and advance the knowledge-creation process in the industry of today; his adds a new entry to the list of currently important location factors influencing the geographical pattern of industry: the knowledge assets and learning abilities of particular local, regional or national milieus”. In this context, it could be stated that before applying any potential project of regional or local development the government of the state usually examines thoroughly the needs of the region in comparison with the required targets (attraction of investments, promotion of the ‘image’ of the community to locals and mostly the foreigners/ visitors). Regarding this issue, it has been found by Hansen (1996, 107) that “strictly speaking, government regional policies should be understood as those policies that have an intentional and formal geographic focus, though they will no doubt use sectoral means in attempting to realize their objectives”. In other words, the plans of governments related with the local and regional development as considered as based on the ‘strengths’ of the particular regions and the needs of the local area (but also of the country) for the attraction of foreign investments (the relevant governmental plans are characterized by Hansen in the above study as ‘policies that have and intentional and formal geographic focus’). Under these terms, the local economies are used as ‘tools’ for the promotion of national economies as well, through a form of mutual and continuous cooperation in the area of financial and urban development. For this reason it has been found by Hansen that “national economies may be regarded as bundles of more or less integrated regional economies; government policies with respect to such sectors as transportation and communications, agriculture, energy, research and development, and education all have varying regional consequences, which in many instances may be more significant than those resulting from regional policies”. In accordance with the above, governmental plans for regional and local development have to be designed in accordance with the interests of the state (as a primary criterion) combining with the needs of local area and the existing infrastructure/ capitals. On the other hand, the role of local officials in the realization of the regional and local development plans should be characterized as crucial. For this reason it has been supported by Robinson et al. (2000, 1573) that “local officials face a challenge in attempting to formulate economic development policy which has to be sensitive to both economic uncertainties and political constraints and cognizant of the limited effects of previous strategies to increase local employment and income”. In accordance with the above any plan of local and regional development should be designed and applied through the cooperation of local and governmental authorities. This issue has been the main subject of the study of Gouldson (2000) who supported that this ‘cooperation’ needs to be more intensive in cases of regional plans related with the environment. For this reason the above researcher noticed that (2000, 7) “above and beyond these basic concerns, there is a further, more practical matter that argues in favour of the adoption of a local and regional perspective on the integration of environmental and economic policy: this is, especially within the European Union, the increasing use of the region as a common building block for policy development and the distribution of financial support”. In accordance with the above study, the local and regional development are considered as belonging in the greater area of sustainable development, however such an assumption cannot be consider as realistic. In fact, regional and local development can be extended in many areas (social, financial even educational) and cannot be exclusively connected with the environment. However, it should be noticed that most commonly these plans refer to environmental issues but there can be also issues of other forms/ categories addressed by the above plans. The relations of the regional and local development with the promotion of particular aspects of the regions involved has been examined by Eskelinen et al. (1998, 24) who supported that “the issue of creating an innovative ‘culture’ has bit by bit come to attract major interest among policy makers in the field of local, regional and national industrial development, just as it has been a rapidly growing area of interest in the academic discourse of economic geography and related domains”. In other words, apart from the environment, culture has been considered as a significant factor for the design and application of local and regional development plans. On the other hand, it has been found in the literature that the local and regional development can face a delay because of the ‘weakness’ of the local area to respond to the demands set by the relevant plans of growth. For this reason it has been supported by Bookman (1991, 183) that “irrespective of the cause, the local production of inputs for the principal sectors of an economy decreases the regional vulnerability to outside economic disturbances, while helping sustain the growth process”. The above assumptions can refer to all regions within a particular country. However, in regions where agriculture is the main source of the financial development, regional and local development has to be formulated in accordance with the needs of the local population as a primary criterion while the attraction of foreign capital should follow. This ‘distinction’ between the plans of local and regional development applied in the agricultural and the industrial regions, is highlighted in the study of Bookman (1991, 83) who supported that “in agricultural regions, the effort for regional development entails the development of agro-industries to satisfy the demand of the high-growth sector while in industrial regions, the existence of a successful machine and tools industry enables less dependency on extra-regional supply sources”. Towards the same direction it has been noticed by Hansen (1996, 107) that “the objectives of regional policies have varied, but typically they have been motivated by such equity considerations as reducing unemployment, increasing incomes, promoting structural adjustments, or realizing development potentials”. Moreover, it is noticed by Isaksen (2001, 101) that “policy-makers should not focus uncritically, therefore, on creating regional systems to support firms innovation activity irrespective of local conditions”. There is however a significant risk for planners of regional and local development. In this context, it is noticed by Mayer (2004, 117) that “too often, practicing economic development planners get bogged down in day-to-day negotiations with developers and lose sight of long-term goals and perspectives; most economic development plans are generic and concerned with operational effectiveness rather than a strategic focus or goal”. Indeed, the plans of regional and local development applied in a particular area have to be ‘adapted’ in the needs and the potentials of the specific regions because in a different case, it is very likely that the application of these plans will not lead to the achievement of the desired target. On the other hand, it is essential the designers of the relevant plans will have the appropriate competence/ capability to understand the needs of the local regions. Otherwise, they cannot design effective local and regional plans in accordance with the needs of the particular regions. A common phenomenon it is the relevant plans are designed and applied by ‘semi-public’ organizations which although they don’t have a ‘pure’ governmental form, they are considered as ‘governmental authorities’. Indicative examples of these organizations are the ‘port authorities, transit authorities, and economic development corporations which possess some of the flexibility of a private corporation while maintaining some of the powers of public entities” (Hagiwara et al., 1996, 33). The involvement of the above organizations in the design and the application of local and regional development plans resulted to the differentiation of the above plans comparing to their primary forms. More specifically, it has been found by Gouldson (2000, 25) that “the nature of regional and local development has become more complex, as the former reliance on various forms of planning and relatively simple instruments such as investment incentives has been superseded by a mix of measures promoting business development, physical and economic infrastructure, research and innovation, human resources, environmental improvement and community development”. This ‘alternation’ of the local and regional development plans should not be characterized in advance as ‘negative’. In fact this change has been ‘imposed’ by the social, political, financial and technological developments taken place in all countries around the world. From another point of view, it could be stated that local and regional development plans can be more effective regarding the promotion of local economy and sustainability compared to similar plans that refer all areas of a particular country. Regarding this issue, it has been found by Gouldson et al. (2000, 7) that “although it is perfectly possible to design and develop policies at a transnational or national level that bring together environmental and economic concerns, such policies are frequently incapable of delivering specific ‘products’ or results”. This ‘weakness’ of national plans compared to the local and regional development plans can be explained primarily by the general character of the former while the latter usually address a specific issue and involve in the development of a specific sector/ place of the particular region. It is for this reason that Gouldson et al. (2000, 7) stated that “the detailed design and implementation of an integrated package of policies is more likely to be achieved at a regional or local level than at a higher level in the hierarchy of governance”. The relation between the sustainable development and the regional and local development has been explained by Roberts (2004, 126) who noticed that “sustainable development is, in essence, increasingly considered to be a central task in any process of local or regional development”. On the other hand, it has been supported by Hansen (1996, 107) that “government policies with respect to such sectors as transportation and communications, agriculture, energy, research and development, and education all have varying regional consequences, which in many instances may be more significant than those resulting from regional policies”. The above findings cannot lead to the assumption that local and regional development cannot be achieved without plans designed by the relevant governmental authorities. However, it is preferable that these plans are structured in accordance with the national plans for development combined with the needs of the particular region, as these needs can be identified better and supported by the local and regional authorities. Traditionally, regional and local development has been related with the urban infrastructure of a specific area. Through the years, sustainable regional development has become a common phenomenon for most cities around the world. Regarding the specific issue, the study of Gouldson (2000, 7) showed that “in individual nation states, economic development agencies are now frequently required to incorporate environmental objectives in their development programmes”. In other words, regional and local development can have many forms and in most cases it can refer to the promotion of specific economic interests at a national or local level. At a next level, Knapp et al. (1987, 1) supported that “modern society has managed to achieve a unique level of financial and technological growth following the principles and the patterns of globalization” and this growth can be better observed in “the traditional capital goods industries such as transport, building, factory equipment, shipbuilding and steel industry”. In accordance with the above views, regional and local development usually serves interests that are related with particular industrial sectors. The above assumption can be justified by the fact that in all countries around the world, the support of the local communities is usually made by the funds offered by the local population while the support of the state is usually limited to specific level in accordance with its financial strength and the capital available for investment in regional and local development plans. Because the realization of these plans usually follows other national plans which are the main priority for all governments around the world, it is normal for the local and regional authorities to proceed to specific initiatives for the ‘attraction’ of capital, even foreign capital if possible, in order to gather the necessary funds for the realization of projects that will benefit the local population. An issue that should be mentioned here is the fact that local and regional development is not ‘equal’ for all areas within a particular country. For this reason, it has been stated by Thorns (1992, 49) that “the impact of uneven regional development over the past decades has brought with it quite marked differentiation between local areas, bringing into greater prominence spatial variations and thus the need for locality-based research; within the localities affected by change there is considerable divergence between those in the sunbelts where there has been job growth and expansion and in the declining areas where the local economy has shrunk”. In other words, the role of regional and local development in the improvement of a region’s economy can be significant. However, if the appropriate political initiatives are not be decided, no development can be achieved even if the capital available is sufficient for the completion of the relevant task. It should also be noticed that the local and regional development in the countries around the world has not been simultaneous as already presented above. In the case of Europe – where the existence of a political and financial ‘bond’ between the member states could possibly justify such a situation – the differences in the patterns and the levels of local and regional development have been significant. For this reason, the study made by Gouldson (2000, 25) showed that “the nature of regional institutions and responsibilities now varies substantially across Western Europe, encompassing state governments in Germany or Austria, autonomous regions and communities in Belgium and Spain, elected regional councils in France and Italy, and decentralized regional offices of central government in Finland and the UK” (Gouldson, 2000, 25). The policies applied by countries regarding the local and regional development cannot be monitored or alternated through the intervention of other states (even belonging to common political and financial schemes, as in the case of Europe. Rather, the states are free to develop their own strategies for local and regional development provided to the local authorities the appropriate political and financial support for the achievement of the relevant target. References Bookman, M. (1991) The Political Economy of Discontinuous Development: Regional Disparities and Inter-Regional Conflict. New York: Praeger Publishers Eskelinen, H., Hannibalsson, I., Malmberg, A., Maskell, P., Vatne, E. (1998) Competitiveness, Localised Learning and Regional Development: Specialisation and Prosperity in Small Open Economies. London: Routledge Gouldson, A., Roberts, P. (2000) Integrating Environment and Economy: Strategies for Local and Regional Government. London: Routledge Hansen, N. (1996) Regional Development Policies: Past Problems and Future Possibilities. Canadian Journal of Regional Science, 19(1): 107-18 Hagiwara, S., Hamlin, R., Lyons, T. (1996) Economy without Walls: Managing Local Development in a Restructuring World. Westport, CT: Praeger Publishers Isaksen, A. (2001) Building Regional Innovation Systems: Is Endogenous Industrial Development Possible in the Global Economy? Canadian Journal of Regional Science, 24(1): 101-104 Knapp, V. D., Wever, E. (1987) New Technology and Regional Development. London: Croom Helm Mayer, H. (2004) Regional Economic Development: Analysis and Planning Strategy. Journal of the American Planning Association, 70(1): 117 Roberts, P. (2004) Wealth from Waste: Local and Regional Economic Development and the Environment. The Geographical Journal, 170(2): 126-132 Robinson, C., Waugh, W. (2000) The Logic and Pathologies of Local and Regional Economic Development Strategies. International Journal of Public Administration, 23(9): 1573-1577 Thorns, D. (1992) Fragmenting Societies? A Comparative Analysis of Regional and Urban Development. New York: Routledge Read More