Political-Economic Approach to Local Economic Development

The political-economic approach to local economic development is rooted in Marxist theory (Harvey, 1973). Although Marx never focused on urban economic development as a central theme, several of his followers have worked to develop a Marxist theory of local economic development (Harvey, 1973; Castells, 1976; Walker, 1981; Smith, 1986). And, although Marxist theory is both descriptive and normative, this dissertation -- like most of the political-economic works within the urban development politics literature -- uses it only for its descriptive capacity. Our normative content draws from democratic theory. Within this literature, it seems the political-economic perspective began “. . . as a critique of [the market economics or ecological perspective] but is now starting to make contributions that define it as a clear alternative to ecological modes of thought. It has been variously described as the new urban sociology (Zukin, 1980; Gottdiener & Feagin, 1988), the new urban politics (Stone, 1991), the institutional approach (Shlay, forthcoming), or political economic theory” (Molotch, 1976; cited in Holupka & Shlay, 1993: 177).



Possibly the greatest value of the urban political-economy framework extends from that which is most obvious about it -- the fact that it distinguishes the political from the economic. By doing so, it makes contingent those conditions that once appeared automatic or inevitable from the more rigid market-economics perspective. Like the market perspective, the political-economic perspective begins with several premises. These, at a minimum, would include the following:



(a) specific local actors and institutions play key roles in determining how local development occurs; metropolitan patterns are not emergent phenomena from the micro decisions of the many, but are directed by decisions internal to local organizations (Molotch, 1976; Holpuka & Shlay, 1993: 177);



(b) the distribution of benefits from development are highly skewed; those at the top reap the benefits from development, while the public largely pays for its costs (Molotch, 1976; Holpuka & Shlay, 1993: 177-178); and that,



(c) urban development policymaking processes tend to be undemocratic; critical decisions are typically hidden from the public view and the public serves to legitimize decisions rather than to play a material role in making them (Molotch, 1976; Holpuka & Shlay, 1993: 178).



Harvey Molotch\'s (1976) \"growth machine\" thesis provides the clearest contemporary expression of the role of politics and agency in the shaping of the urban environment. Since this thesis is given considerable attention at a later point, I will simply state, for now, a summary written by Holpuka and Shlay (1993). As these writers reveal, the success of the growth machine turns on its ability to remain “unaccountable while maintaining an appearance of openness in the politics that guides development. The facade of democracy is necessary because the true benefits and costs are hidden from the public domain. Development projects are \"sold\" to communities and often provided with large public subsidies with the rationale that development will benefit the community (e.g., the presumption of \"unitary interests\"). But the benefits of growth are almost always skewed in favor of landowning elites. Moreover, growth appears to be accompanied by many negatives -- higher housing costs and problems of housing affordability, increased congestion, and pollution, greater demand for public services, and higher taxes. Therefore, authentic democracy and a true accounting of the costs and benefits associated with development in informing decisions over the direction of urban development surely might undermine growth machine endeavors” (Molotch, 1976; Holpuka & Shlay, 1993: 180).



Author: Steven A. Maclin, Ph. D.



About the Author: Dr. Maclin has been a university professor of public administration and policy since 1994. Recently, from 1998 - 2004, he lived and worked with American military troops in Japan, Okinawa, and South Korea. He has previously edited and published dozens of articles in professional administrative journals and recently, in his ‘spare time,’ he’s been building websites for distributing materials to his graduate students. He\'s now stateside, teaching graduate students online, writing articles and developing a small online business (see http://buyfromart.com); he can be reached at info@buyfromart.com.