The First Wave Summarized

1
The First Wave Summarized

• The Waves Focus Business Attraction, aka
  Smokestack Chasing
• Origination The Souths pursuit of business
• Methods Lower costs of doing business through
  IDBs, loans, tax cuts, free land/infrastructure,
  no unions, place marketing, etc.
• Establish a positive business climate.
• Context This strategy made sense for many
  reasons1) Lack of industry in the South
• 2) Era of National Champions (Fordist social
  contract)
• 3) A broadly growing national economy
• Problems/Issues1) Zero-Sum Game
• 2) Major public giveaways
• 3) Loss of effectiveness over time
• 4) The but for question

2
The Second Wave Summarized

• The Waves Focus Expand and grow local
  businesses
• Origination Recognition of importance of 1) the
  internal economy, 2) small businesses (SBs) and
  3) high technology
• Methods Loans and grants to SBs, business
  incubators, job training for local employees,
  pursuit of high-technology, early state
  entrepreneurship.
• Grow a strong local economy.
• Context This strategy made sense for many
  reasons1) Small businesses are where most new
  jobs are created
• 2) Failure of the First Wave
• 3) Emergence of high technology
• 4) Fewer federal dollars for local development
• Problems/Issues1) High failure rate of small
  firms
• 2) Sluggishness of these economic development
  efforts
• 3) Higher risk public interventions
• 4) Still a business-centered approach

3
The Third Wave Summarized
The Waves Focus The Entrepreneurial
City Origination Recognition of the need to link
capital, human capital, and technology in the
global economy Methods Initiatives are
market-based, ad hoc, not embedded in specific
programs or policies. Public-private
partnerships, ED through quasi-public agencies,
Stimulate new enterprise through any means
necessary. Context This strategy made sense for
many reasons1) Fewer federal dollars for local
development (the New Federalism) 2) Impacts of
globalization 3) Increasing recognition of the
role of human capital in ED 4) More skilled
and experienced practitioners Problems/Issues1)
Still a business-centered approach or a
development-centered approach 2) Use market
criteria, not holistic criteria to define
success 3) An approach still based in
competition with other places