Introduction to Symposium on Managing Local Development

Much of the literature on managing the economy focuses first on the role of the federal government and increasingly in recent years on the role of state governments. The Full Employment Act of 1946 explicitly assigns macroeconomic management to the federal government; with its potentially powerful tools of monetary and fiscal policy, the federal government has more capacity than other levels of government to influence the aggregate level of jobs and prices. During the 1970s and 1980s, federal budgetary problems, competition from abroad, and changing conceptions of the appropriate division of responsibilities among levels of governments focused new attention on the increasingly active roles that state officials are taking to promote state economies. (See, for example, Fosler, 1988.) However, the macroeconomic policies of the federal government and the specific development strategies of state governments are not the whole story of economic management. Local government officials, citizens, and business groups throughout the country are actively engaged in promoting local economic development. In some cases, public involvement in the local economy seems to promote success; in other cases it fails. Yet policy analysts have devoted little attention to local economic management, have inadequate understanding of the nature of successful interventions, and consequently are not in a strong position to advise local policymakers. To the extent that improved policy interventions at the local level lead to more effective use of existing resources rather than just the transfer of development from one area to another, better local economic management could increase aggregate output and productivity. By focusing explicitly on local economic management, the papers in this symposium contribute to research and policy discussions of this topic. The standard models used by economists to explain and predict state or regional economic growth typically focus on differential costs of producing goods and services in different locations, most of which can be quantified and incorporated into regression models. Emerging from this focus on cost factors-such as wages, energy, transportation, and taxes-is frequently the policy prescription that the only way to promote development is to reduce costs. Yet none of these models fully explain growth rates, they are not good

Engineering ethics · Political science · Regional science · Sociology · Engineering · Fiscal Policy and Economic Growth

• Addressing Global Challenges Through Local Government Governance

  Open Access•Xiaoli Zhou, Mingyang Han et al.•SAGE Open•2025

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