Making the Least of Our Differences? Trends in Local Economic Development in Ontario and Michigan, 1990-2005

By Reese, Laura A.; Sands, Gary | Canadian Public Administration, Spring 2007 | Go to article overview

Making the Least of Our Differences? Trends in Local Economic Development in Ontario and Michigan, 1990-2005


Reese, Laura A., Sands, Gary, Canadian Public Administration


This paper examines trends in local economic development policies in Canadian and us cities over the past fifteen years. Using data drawn from surveys conducted at four points in time--1990, 1994, 2001, and 2005--the study allows for a longitudinal assessment of change versus stability in overall approach toward economic development. While cross-sectional analyses have concluded that cities in the two nations "often exploit the same techniques," how this situation has revealed itself and the extent of convergence or divergence in approaches to development over rime is still not fully understood. (1)

While economic development comprises many different things to different people. It embraces:

--retaining businesses: insuring the needs of existing businesses are expressed and addressed;

--recruiting businesses: seeking new business and investment opportunities from outside the community;

--nurturing entrepreneurship and new businesses: facilitating and supporting creation of new businesses from within the community;

--creating jobs: encouraging both retention of existing jobs and creation of new job opportunities;

--marketing the community: identifying key community assets and marketing and promoting the community to the rest of the world;

--diversifying the economic base: insuring a diverse economy to support the community;

--building social and human capital: strengthening schools, community groups and governments, and fostering a commitment to education, innovation and partnerships; and

--improving the quality of life of all those in the community.

It is expected that economic development approaches in both us and Canadian cities will have remained relatively stable, focusing most heavily on traditional economic development strategies, despite recent research calling for more entrepreneurial, amenity-focused, or culturally-based policies. (2) However, other research has identified subtly different patterns in policy approaches in the two nations, with us cities manifesting a more passive government role that relies on traditional financial and infrastructure incentives. Canadian cities, on the other hand, appear to have adopted a more active public sector role through partnerships involving a strong professional staff and the implementation of a more entrepreneurial policy approach. Further, differences in planning traditions in the two countries appear to have resulted in more goal-directed behaviour among Canadian cities, which are reflected in more careful and focused choices among economic development policies. Cities in the United States, on the other hand, appear more likely to use planning as a justification for a wider, less-focused array of development policies. In short, Canadian cities appear more strategic in their development activities. (3)

Most of the research on which these conclusions are based is cross-sectional or longitudinal analysis with a limited number of observation points. The data used here include sufficient measurement points to allow for a more extended assessment of whether any policy and strategy differences are continuing, and provide the basis for projections about the future of local economic development practices in the two nations. The specific research questions include:

--What have been the trends in local economic development policy in cities in the United States and Canada over the past decade and a half?

--Have cities in the two nations become more similar or different in their approaches to economic development?

--Does it appear that cities are, over rime, strategically focusing on amenities, high tech, or the arts to promote economic development based on creative class arguments?

--Based on policy trends over the past fifteen years, what can future economic development strategy approaches be expected to look like?

Literature review

Canadian/US local economic development

As previously noted, research on local economic development policy comparing us and Canadian cities, while extensive, has tended to rely on case studies of large central cities, single state/province comparisons or large cross-sectional surveys. …

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