Economic Development in the Nonmetropolitan West: The Influence of Built, Natural, and Social Capital

By Crowe, Jessica | Community Development: Journal of the Community Development Society, Winter 2008 | Go to article overview

Economic Development in the Nonmetropolitan West: The Influence of Built, Natural, and Social Capital


Crowe, Jessica, Community Development: Journal of the Community Development Society


An increasing amount of research has been dedicated to studying economic development at the community level. Although several scholars have examined the effect of one or more community capitals on economic development, few studies examine the full array of capital with respect to economic development. In particular, research has failed to examine community leaders 'perceptions of how the different types of capital affect the implementation of businesses in the community. Using survey and interview data collected from seven communities in Oregon and Washington, I examine which forms of community capital: human, built, social and natural community leaders perceive as having a substantive effect on local economic development as well as explain how such perceptions held by leaders relate to economic development implementation and promotion. Results suggest that community leaders perceive built, social, and natural capitals as having the most effect on economic development. Communities that had high levels of at least two of the capitals, natural, built, and social had implemented the largest number of outside businesses or industries in the previous three years. On the other hand, the two communities with high natural capital low built capital, and moderate social capital had implemented the most local businesses or industry in the previous three years. These findings illustrate the need for researchers, policy-makers, and community activists to heavily consider the complex ways that built, natural, and social capital work together to influence self-development and industrial recruitment.

Keywords: community economic development, community capitals, and Pacific Northwest

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Economic development is an important issue for rural communities, as many communities that were once dependent on natural resources and manufacturing have had to look elsewhere for jobs. This is because structural changes and technological advances in these sectors along with advances in shipping and "free trade" policies have led many of these jobs to move to less developed countries, thus posing a threat to the survival of rural communities as homes and places of work (Flora & Flora, 2008; Sharp, Agnitsch, Ryan, & Flora, 2002). The economic hardships that have hit many rural communities make conditions prime for increased tension over economic development. Perceptions of community capitals' effect on local economic development, regardless of actual impact, provide the foundation for which types of economic development are pursued--making community leaders' perceptions of particular importance. While some communities attempt to recruit outside business and industry to locate to their areas, other communities generate and encourage local businesses and other entrepreneurial activities from within the community.

In seeking to understand and adapt to such structural changes, analysts and policymakers have studied which community characteristics lead to effective economic development implementation (e.g. Crowe, 2008; Flora, Sharp, Flora, & Newlon. 1997; Sharp et al., 2002). Characteristics of communities that have been analyzed include social infrastructure, (Crowe, 2006; Flora et al., 1997; Sharp et al., 2002) human capital (Becker, 2002; Gordon, 2000; Schultz, 1961), information communication technologies (Pigg & Crank, 2005), natural endowments (Crowe, 2006, 2008; McGranahan, 1999), organizational structures of communities (Crowe, 2007), and physical infrastructure (Christopherson et al., 1999; Harrison, 1992).

While researchers see the need in examining the characteristics that lead to effective community-level economic development (e.g. Crowe, 2006; Flora et al., 1997; Putnam, 1993; Sharp et al., 2002), most sociological research has focused on the impact that one or two sources of community capital have on economic development. When studying economic development, it is important to analyze development activities with respect to the full array of capital from which a community can draw. …

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