Academic journal article Journal of Economic Issues

Sustainable Regional Economic Development

Academic journal article Journal of Economic Issues

Sustainable Regional Economic Development

Article excerpt

Designing successful economic development programs is a very difficult task. Most state or regional planning boards rely on "ad-based" campaigns that lack any significant strategic content. Most programs simply produce a series of glossy booklets that tout the region's amenities or praise its "hard-working" people. The success gained by these shotgun programs is often very limited. The development that does occur typically fails to benefit the local community beyond a simple job count.

Economic development programs must be cognizant of generating sustainable development, sustainable not just from an ecological point of view but also from the viewpoint of preserving the region's economic and social integrity. Economic development can be pathological if the economic change erodes the community base or increases the vulnerability to macroeconomic fluctuations. Development programs must be designed to harbor the core community values while offering new economic opportunities. What is needed is a strategic development plan that contains the tools necessary for the measurement of social and economic change.

The purpose of this paper is to establish a method of regional development design which can generate sustainable economic development. The concept of sustainable economic development is expanded beyond its traditional ecological boundaries to include development that is resistant to social degradation as well as insulated from macroeconomic fluctuations. The paper examines the psychological and community core issues that follow economic transformation. It then offers a portfolio-planning option that treats a local economy as if it were a "portfolio" which can be actively managed to avoid unnecessary market risks. It concludes with a brief examination of

West Virginia's industrial clusters to illustrate the value of strategic development planning.

Sustainable Development and a Region's Integrity

Defining sustainable development is a difficult task as sustainability has come to mean many things to many people. Richard Douthwaite (1999, 157) pointed out that there are twenty-two definitions of sustainable development in the environmental text Blueprint for a Green Economy (Pearce et al. 1989) alone. While sustainable development research spans a wide variety of sociological and economic literature, it does have a generally accepted core definition. Sustainable development is loosely defined as economic enhancement that meets the needs of the present generation without compromising the ability of future generations to meet their needs (Robertson 1999, 1). Environmentalists have examined sustainability for some time, but the regional development literature has generally ignored the issue. Most of the traditional regional development analysis conducted today contains limited long-term focus. In this section, we set the typical environmental concerns aside and examine a different facet of sustainability. Specifically, we focus on sustaining the core socioeconomic integrity of a regional economy.

Any social entity is built from individuals interacting within a cultural environment. Therefore, the psychology of the self is germane. The self must persist and adapt; otherwise the individual loses touch with reality and is unable to integrate itself in a viable way. This continual adaptation is facilitated by a consistent cultural and institutional structure. Therefore, an integral part of sustainability is the maintenance of relative consistency in the cultural and institutional structure. This does not mean that the region's socioeconomic structure cannot evolve over time; social entities certainly do evolve and transform. What it does mean is that this change cannot be so rapid that individuals within the system are left without norms or values that define their existence. This behavioral structure is often loosely, and somewhat incorrectly, defined as community in the regional literature. …

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