The Growing Local Economies Approach

The Growing Local Economies Approach

When people think of economic development, they usually think about creating jobs by attracting businesses to a region. Of course, job creation is important, but it is only part of the story. The Growing Local Economies initiative represents an alternative approach. It looks at the economy as a whole--where money and resources flow in and out of a community--and works to create conditions that build local prosperity.

Growing Local Economies searches for ways to structure the local or regional economy to benefit the most people now, while reducing negative impacts on the quality of life of future generations. It concentrates on increasing the proportion of goods and services purchased locally by both consumers and by businesses. When a community buys goods and services from outside businesses rather than local businesses, money "leaks" out of the community. On the other hand, when a community uses more locally-produced goods and services, more money circulates inside the community. This extra money can be used to build prosperity.

Local ownership is part of the story. Locally-owned businesses can make business decisions that benefit the community, and they are usually better at circulating money than businesses controlled by outside interests. Local businesses also spend more money locally.

LOIS and TINA

Growing Local Economies focuses on expanding and developing enterprises that are both locally owned and that plug leaks in the local economy. Growing Local Economies partner Michael Shuman calls this approach "LOIS"—Locally Owned, Import Substituting—and provides an array of potential strategies that can help a community move in the LOIS direction. Building a LOIS economy is about more than starting businesses. It is about planning together across many sectors of the community. LOIS is now coming into its own as an approach to local economic development. However, LOIS still has to compete on an uneven playing field where policies favor conventional approaches that focus on bringing in large outside businesses to create jobs and exporting goods as far and widely as possible. What has always been done sometimes seems like the only alternative. Shuman calls this thinking TINA--There Is No Alternative.

But there is an alternative. It's called LOIS.

The Growing Local Economies definition of local economic development

Local economic development is a participatory process which encourages social dialogue and public-private partnerships in a defined geographical area. In this process, more and more local organizations look for ways to make their actions and investments reinforce the wishes and intentions of the whole community. Business becomes a way to accumulate broadly distributed wealth and to make the local way of life more creative, inclusive and sustainable now and 20 to 30 years from now. It is integrated across all sectors of the community, including health, education, the arts, infrastructure, environment, and other contributors to the quality of life.

~Edited from multiple sources

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