Challenges in Local Development Politics in a Globalized Economy

Special Report: Economic Coordination
By Pascal Chauchefoin

The strategies of firms are increasingly difficult to decipher, because they are now elaborated in an global framework and in potentially rapidly evolving competitive contexts. This complexifies the process of elaboration of local development policies, which aim at valuing the economic potential of local territories. Local decision makers are thus tempted to ignore what they cannot control and to adopt a narrow conception of local economic dynamics by focusing on community-like relations between local firms. Inevitable and largely-publicized examples of this conception are the Swiss Jura, industrial districts of the “Third Italy,” or the Silicon Valley in California.
Although many studies on these territories have shown that they could not be reproduced, these famous examples are still a reference for many local policy-makers, and the financial support scheme elaborated by the French National Spatial Planning Agency (DATAR) and dedicated to “localized production systems” reinforces the widespread illusion on the local development potential of this very particular form of industrial organization.
Economic networks developed by firms exceed by far the limits of local territories; therefore the basic principles of the so-called “local governance” are often at odds with the organizational logics of firms and the real spatial issues of a globalized economy. In order to give a better chance to the relationship between the local policy maker and the local manager, it is essential to include into the toolbox of local development policy an explicit concern in the relation between the local scale and the other relevant spatial scales.

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