What is Economic Development?
What does economic development mean to you? We hear lots about it being a good thing for the country but what does it mean for us here in Central Otago? Some of you might have noticed that the designation of Warwick’s position has changed from Business Development Manager to Economic Development Manager. The reason for the change is to give a greater community focus to the position.
Don Hofstrand of the Iowa State University of Extension set the issue out well in his August 2009 paper “Business Development vs. Economic Development”. Hofstrand defined Economic Development as being driven by job creation with a focus on a specific geographic area, with the objective of attracting business, originating from the public sector and answering to the community. On the other hand he defines Business Development as being driven by profits, with a focus on markets, creating businesses, originating in the private sector, and answering to investors.
Hofstrand notes that business development and economic development are related methods of creating economic activities and need not be competitive activities. Economic development cannot be sustained without successful business development – business failure benefits neither the owners nor the community in which the business is located. But with proper planning economic development activities can lead to the development of businesses that are successful.
Economic development, in its broadest terms, is about the standard of living of our people. It is essential to the wellbeing of our community and underpins all our social and cultural aspirations - from jobs, so our young people don't have to move away, to a good cup of coffee when you're cycling the rail trail and need a break, to thriving local communities with growing populations, good schools, and the talent needed to make up the local drama society and rugby team.
If you would like to read more about local economic development the World Bank is a good starting point.