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METROPOLITAN ECONOMIC STRATEGY
TEAMWORK: WHY METROPOLITAN ECONOMIC STRATEGY IS THE KEY TO GENERATING
SUSTAINABLE PROSPERITY AND QUALITY OF LIFE FOR THE WORLD
Marc
A. Weiss
METROPOLITAN
ECONOMIC STRATEGY IS NOW ESSENTIAL FOR EVERY NATION AND URBAN REGION
The
most important geographic units of economic activity in the world today,
other than the nation-state itself, are urban regions. All across the
world, in every country, more than half of the national income is generated
by urban areas. Indeed, these percentages range from an average of
55% in low-income developing countries, all the way up to an average of 85%
in high-income developed countries. What is all the more striking
about these statistics is that in every case the percentage of national
income generated by urban areas exceeds the percentage share of the
national population that is urbanized. In the case of the low-income
developing countries where urban areas account for an average of 55% of the
national income, the urban share of the population averages 32%. In
middle-income countries, the urban share of national income averages 73%,
whereas the urban share of the population averages 50%. For
high-income countries, the average urban contribution to national income is
85%, yet the urban proportion of the national population is 79%. This
shows that the greater the level of urbanization in a nation the higher is
its level of prosperity, and conversely, the more prosperous a country is,
the more urbanized it is at the same time.
Take
almost any city in the world, and its contribution to national prosperity
substantially exceeds its percentage of the nation’s population.
Prague, the capital city of the Czech Republic, is a good example. It
has 10% of the national population, 15% of the nation’s workforce, over 20%
of the national Gross Domestic Product (GDP), and more than 50% of the
national tourist revenue. Cities all over the world, rich and poor,
in developed and developing countries, on every continent, follow a similar
pattern, whether it be Belgrade with 41% of the national GDP and 14% of the
national population, or Bangkok, with 41% of the national GDP and 9% of the
national population.
The
reason for this disparity is because urban regions are the only places that
can combine the two most important elements for generating productivity and
innovation, which is the main way that economies create value and compete
in the global marketplace. These two elements are specialization and
diversity. Only an urban region can gather together a critical mass
of people with highly specialized and advanced skills in knowing how to
engage in particular productive activities. Further, only an urban region
can combine within one broad location a large number of different people
with a wide range of highly diverse specialized skills, mixing together
this wide range of skills to become both very productive and particularly
innovative in developing and marketing new products and new production
processes. Such a combination of specialization and diversity becomes
even more vital than ever in today’s new economy, which is characterized by
three key features: 1) it is knowledge- and information-based; 2) it is
technology- and communications-intensive; and 3) it is globally oriented.
Urban
regions are vital competitive geographic units of the global economy, major
contributors to generating and sustaining prosperity and quality of life
for every community and nation. These expansive city-suburban-exurban
areas are now the main battleground where competition is won or lost in
developing new inventions, generating investment, jobs, trade, high
value-added production, and enhanced incomes. Indeed, urban
regions represent the most vital sources of prosperity for every
nation. Promoting productivity and innovation is essential for
competitive success in the world economy, and urban regions have become the
leading generators of technological and organizational advances in the
production and distribution of goods and services for the global
marketplace. The main prescription for victory in global economic
competition is to establish metropolitan centers of innovative activity,
combining creative human talent with state-of-the-art equipment to incubate
and foster technical advances in a wide range of interrelated products and
production processes.
The
principal reason for the growing importance of metropolitan economies in
generating national prosperity is their essential character as the only
geographic entities that contain, in relatively compact form:
·
the critical mass of skills and resources;
·
the necessary population density and concentration of
market incomes;
·
the range of specialized knowledge and institutions;
·
the wide diversity of vitally needed facilities and
services;
·
and the fully
developed physical and human infrastructure that are prerequisites for new
ideas, products and production methods, technological and organizational
innovations, and dynamic economic growth and investment.
While
rural areas can and do contribute substantially to overall economic well-being
through agriculture, mining, natural resources utilization, and recreation,
they cannot generate the extensive and competitive prosperity and quality
of life for millions of people that emanate primarily from urban
regions. Only the metropolis has the fundamental assets that together
can offer the unique combination of specialization and diversity to
stimulate self-sustaining economic development and job creation, with the
clustering and networking dynamic among many different firms, entrepreneurs,
and institutions interacting in ways that spawn and accelerate growth of
production and exports, and expansion and spreading of incomes and wealth.
The
evidence is mounting on the essential national and international economic
role of urban regions, and it comes from a wide array of expert
analysts. One such source is research performed by a highly respected
economic analysis and management consulting firm, the Standard & Poor’s
DRI division of the McGraw-Hill Companies. Two studies, entitled US
Metro Economies: The Engines of America’s Growth, and US Metro
Economies: Leading America’s New Economy, document in statistical
detail the overwhelming presence of economic activity in urban regions and
its impact on overall growth in high-technology fields and throughout the
national economy:
The
geographic concentration of business and people in metro areas creates
unique economic conditions that generate new industries, speed the
diffusion of knowledge, spur technological innovation, and increase
productivity. Metro areas have larger markets for goods and services,
more specialized labor pools, and more extensive and sophisticated
transportation and telecommunications networks than non-metro areas.
These competitive advantages make metro areas the engines of US economic
growth and the source of new high-technology industries. Today, metro
areas generate more than 80% of the nation’s employment, income, production
of goods and services, and 94% of high-tech jobs and output…and are the
gateway for 83% of US merchandise exports.
In
addition, a steadily expanding group of scholars and experts in related
fields such as economics, business, management, geography, planning, and
public policy argue that as globalization advances and the speed and convenience
of international transportation and telecommunications bring people and
goods closer together, the strategic value of specific places becomes
more, rather than less, important. This is because of the ability of
highly skilled and educated entrepreneurs and professionals to locate where
they want to be instead of where they must be, with a much wider range of
choices available to them. For example, Professor Michael Porter of
Harvard Business School, in his book, On Competition, emphasizes the
growing tendency of corporations to concentrate their major activities in a
specific “home base” located in urban regions throughout the world:
When
considering the globalization of competition, however, one must confront an
apparent paradox: Although companies do indeed compete globally and inputs
such as raw materials, capital, and scientific knowledge now move freely
around the world, strong evidence shows that location continues to play a
crucial role in competitive advantage...This geographic concentration of
competitive advantage appears not only in established industries such as
automobiles and machine tools but also in new industries such as software,
biotechnology, and advanced materials...[G]lobal
companies have indeed dispersed activities to many countries, but they
continue to concentrate in one location a critical mass of their most
important activities for each of their major product lines or businesses.
Los
Angeles Times
columnist Joel Kotkin, in his book The New
Geography, makes a closely related point:
Decisions
about where to locate businesses, for example – once dependent on questions
of access to ports, roads, rails, or raw materials – are increasingly
dependent instead on the ability to link often scarce human resources.... These changes profoundly alter the
very nature of place and its importance by de-emphasizing physical
factors...and placing greater emphasis on the concentration of human skills
in dense concentrations of population....
The more technology frees us from the tyranny of place and past
affiliation, the greater the need for individual places to make themselves
more attractive. Surveys of high-technology firms find that among
factors that drove their decision of where to locate, a ‘quality of life’
that would make the area attractive to skilled workers was far more
important than any traditional factor such as taxes, regulation, or land
costs.
Views
emphasizing the increasing role of economic geography and the competitive
advantages of urban regions are strongly reinforced not only by numerous
other academics, writers, and consultants such as Kenichi Ohmae, Rosabeth Moss Kanter, Paul Krugman, Peter
Hall, Manuel Castells, Neal Peirce, and Saskia Sassen, but much more importantly, by many business
executives, corporate real estate professionals, site selection advisers,
and economic development location experts, all of whom primarily target
urban regions when they conduct and publish surveys of the “best places for
business.” Indeed, a detailed analysis of the business media and
related publications clearly demonstrates that urban regions are the
most often analyzed geographic unit represented in national and
international location ratings. Even when the title of the article or
report is “the best cities for business,” what the magazine or rating
agency really is evaluating are entire urban regions, not just central
cities.
The
vital economic contribution of urban regions is anchored by the major
cities they encompass, which provide the constant stream of creative
activity, interaction, specialization, and diversity that is essential for
innovative ideas, methods, and products to develop and thrive. In the
global economy of the 21st century, cities function primarily in
seven distinct and essential ways to generate national prosperity.
They are:
·
centers of innovation and services, including
advanced and highly specialized services
·
centers of culture, sports, entertainment,
conventions, and tourism
·
centers of education, research, and health care
·
centers of transportation and trade
·
centers of manufacturing and technology development
·
market centers
·
workforce centers
METROPOLITAN
ECONOMIC STRATEGY: A NEW GLOBAL POLICY INITIATIVE
Every
urban region experiences economic growth or decline, regardless of whether
there are comprehensive plans or coordinated initiatives. Urban
regions function as fully integrated economies in terms of the production
and distribution of goods and services, and they will function as such with
or without a coherent economic strategy. A critical determinant of
their success is the decision-making process of private sector executives,
investors, entrepreneurs, and consultants making facility location
commitments in the global marketplace, especially their evaluation of the
synergy and attractiveness of urban regions as centers of innovation that
can provide businesses with a competitive advantage.
Unfortunately,
metropolitan regional economic growth often occurs in an uncoordinated and
haphazard fashion, and consequently may be missing opportunities to produce
greater investment, higher incomes, and more equitable distribution of the
benefits of prosperity among people and places. Most urban regions do
not have viable mechanisms for promoting metropolitan-wide economic
development by creating a common vision, formulating a collective strategy,
or jointly cooperating to implement major initiatives. Much of the
contemporary debate centers on the impacts of metropolitan economic growth,
including whether growth is too fast or too slow, problems of fiscal disparities
and geographic or social inequities, and harmful effects on environmental
quality. This discourse is primarily about analyzing trends and
reforming policies.
Metropolitan
Economic Strategy, on the other hand, is a proactive organizing principle
that directly depends on regional teamwork and citizenship. Such
strategies are explicitly designed to bring together the public, private,
and civic sectors across the entire urban region to formulate and carry out
a coordinated set of targeted investments in people and places, consciously
designed to enable businesses to grow, jobs to expand, incomes to rise, and
quality of life to improve. Each of the major constituencies — business,
government, and community leadership — must closely collaborate for the
metropolis to thrive economically, socially, and physically. In just
the same way that local, provincial or state, and national or federal
governments use economic development plans to guide their actions, so also
must the many different communities and constituencies that comprise an
urban region farsightedly engage in such comprehensive planning and united
action if they are to compete effectively and succeed in the global economy.
TEAMWORK:
CREATING METROPOLITAN IDENTITY TO COMPETE AND WIN IN THE GLOBAL MARKETPLACE
The
real “city” of today is the “metropolis.” Urban regions are the most
economically organic components of urban geography and demography affecting
people’s daily lives at the local level, and the main access points for
individuals trying to thrive in the global economy. Yet the greatest
barrier to regional coordination, cooperation, and collaboration is the
lack of a common metropolitan consciousness and citizenship.
Therefore, promoting teamwork by encouraging households and families to
begin reaching beyond local political boundaries in pursuit of their common
interests and goals of increasing prosperity and enhancing quality of life
is essential both for individual and for collective success.
By
emphasizing the interwoven economic destinies that bridge across families
and communities within urban regions, people can begin to see themselves as
members of a cohesive economic team that is actively competing against
other economic teams all over the world. Metropolitan Economic
Strategy is thus vital for encouraging a unified vision of regional
purpose. It promotes “identity regionalism” — a common interest and a
sense of mutual benefit that is much more powerful and effective than the
typical “functional regionalism” organized around managing regional public
facilities such as airports, public transit, parks, water and sewer
systems, and other types of single-purpose governmental responsibilities.
The lack
of political and cultural traditions that tie people together within a
common metropolitan framework poses a major challenge for urban regions
competing economically in the global marketplace. Governmental
jurisdictions in which citizens exercise their right to vote are organized
along local, state or provincial, and national or federal lines.
Urban regions transcend the boundaries of cities, towns, townships,
villages, boroughs, counties, special districts, and other public entities
run by elected officials. Many of the world’s urban regions cut
across provincial or state lines, and some even cross national
borders. Therefore, the average person does not see himself or
herself as an integral part of a metropolitan economy. Most senior
corporate executives do clearly understand regional economic connections,
because product markets and labor markets operate across the whole
metropolis, as do most major institutions such as hospitals and
newspapers. Companies make decisions regarding investment, production,
distribution, and site selection based on the assets and qualities of the
entire urban region, even though their facilities are located within the
administrative jurisdiction of smaller units of local government.
One
important exception to the general lack of common metropolitan identity is
college and professional sports, and, to a lesser extent, certain forms of
arts and entertainment such as museums, orchestras, theaters, and
parks. If one draws an invisible circle around an urban region, one
typically finds that everyone living and working within that circle is
expected to “cheer for the home team.” Competitive team sports is one
of relatively few spheres of interest uniting cities, suburbs, exurbs, and
rural areas, even transcending national boundaries. The challenge for
21st century global competitiveness in every country is for
diverse urban populations to relate economically in the same way they
identify as sports fans, and to collectively support their “home team” by
working together as citizens of a metropolitan economy to promote local and
regional prosperity and quality of life. Given that the dynamic of
metropolitan interrelationships represents how the global economy actually
functions and regional vitality is truly maintained, it is only a matter of
time before everyone recognizes this modern reality. A vital
challenge is for residents of urban regions to begin engaging in this new
form of economic teamwork, clearly understanding that doing so will
best enhance their opportunities to prosper in the global marketplace.
GOOD
LEADERSHIP AND GOVERNANCE ARE VITAL FOR METROPOLITAN ECONOMIC STRATEGY TO
SUCCEED
Good
leadership from the public, private, and civic sectors is essential to
bring together disparate groups, interests, and places into a coherent body
with a shared vision and commitment to coordinated action. Such
leadership can emerge from an economic crisis, as in Barcelona where job
losses in the late 1970s served as the impetus for the successful bid to
host the 1992 Summer Olympics and use it as the catalyst for developing a
new, forward-looking economic strategy, or in Washington, DC, when a
municipal budget deficit and reduction in federal government employment
served as the impetus for an aggressive new strategy for diversification,
growth, and community improvement. Leadership can also come from a
vision of expanded opportunity in the absence of a perceived crisis, such
as in Shanghai, with the Chinese government promoting investment in the
city and surrounding region as the leading edge of national economic
competitiveness in global markets, or in Austin, Texas, where dynamic
business and government leaders turned a state capital and university town
into a worldwide center of technological production. In either case, people
must have a genuine desire and willingness to work together for
improvement, and a belief and faith that working together in creating and
carrying out a strategic vision will generate meaningful results and
widespread benefits.
When
most of the major stakeholders finally have agreed to work together across
an urban region, then the issue becomes how to do so most effectively to
generate broad-based economic growth and increased quality of life.
In order to formulate a good strategy, clear agreement on goals is needed,
though the most important goal should always be enhancing prosperity and
quality of life for everyone and everyplace. Also needed is a very
clear understanding of the market forces and institutions, because a
strategy is a theory of cause-and-effect relationships that must be based
on a realistic comprehension and thorough knowledge of what is actually
occurring and how things truly operate. A strategy is not just
stringing together a collection of specific projects or programs. There
must first be a broader clarity about how to accomplish the planned
results, and only then will doing major projects and programs become a
necessary and vital aspect of the implementation process.
Another
important challenge for Metropolitan Economic Strategy to succeed is that
of governance. Even though urban regions are the main engines of
growth, productivity, and innovation in the global economy, governments are
not organized along such geographic lines. In most cases, with China
as a notable exception, there are no general purpose governments with
substantial authority and resources whose jurisdiction corresponds directly
to the boundaries of urban regions. South Africa recently created
metropolitan governments to end the legacy of apartheid and bring together
under one jurisdiction the formerly “white” cites and “non-white” suburban
townships, but even in those situations it is necessary to bring together a
wide variety of local government jurisdictions, along with provincial and
national governments, in order to prepare and implement a Metropolitan
Economic Strategy. In many places around the world, the population
and workforce of urban regions cut across provincial or state borders, and
in some cases, even national boundaries, thus compounding the governance
challenge. Developing leadership that can build consensus and
collaboration is a vital task. No strategy can succeed without good
leadership. Also, coordination among numerous governmental units is
only part of the challenge of governance. Public-private partnerships
that include business and civil society along with government are equally
essential.
During
1997-98, in Washington, DC, we engaged in a massive effort to create a
strategic economic development plan that has been very successful in
expanding jobs and capital investment, raising incomes, promoting
development and renovation, increasing homeownership, and improving
neighborhoods. This was a city-level plan, but one that took an
explicitly pro-metropolitan approach. We studied the city’s prospects
in the context of its role in and contribution to the metropolitan economy,
focusing on how to grow the overall regional pie and capture a larger slice
of that expanding pie for the city and its residents. Many of the
projects, such as the NoMa (North of Massachusetts Avenue) initiative that
financed and built a new Metrorail transit station and bicycle/pedestrian
path at New York Avenue and redeveloped a deteriorated and abandoned area
of the city as a thriving technology, media, arts, and housing district,
won support from regional business and government leaders outside the city
because it improved metropolitan economic competitiveness. The NoMa
story was a good example of “win-win” inclusiveness, as it brought together
and benefited various levels of government, private businesses and property
developers, low- and moderate-income community residents, and environmental
activists, which is why it was designated in 2002 by the United Nations as
one of the 40 worldwide Best Practices to Improve the Living
Environment. Other city initiatives also had a metropolitan
dimension, such as extending Metrorail service to Washington Dulles
International Airport in order to make it easier for low-income city
residents to obtain and travel to suburban jobs, and also including the
offer of new financial incentives for suburban residents to purchase homes
and move back into the city to enjoy the attractions of a more
urban-oriented lifestyle.
TWO
ESSENTIAL ELEMENTS OF METROPOLITAN ECONOMIC STRATEGY: INVESTING IN
FUNDAMENTAL ASSETS, AND BUILDING DYNAMIC INDUSTRY NETWORKS
A
good economic strategy consists of two key elements: 1) building from
strength —
investing in the fundamental assets and activities that make people more
productive and places more valuable; 2) generating dynamism — promoting
modern, globally competitive industry networks that accelerate the pace of
innovation and growth. Investing in the fundamental assets shifts
the focus away from narrowly defined economic development initiatives that
rely on tax subsidies and other incentives. The biggest asset
is people, and what makes them productive are investments in transportation
and infrastructure that move people, goods, and information most
efficiently and cost-effectively, investments in education and workforce
development that make people more skilled and innovative, investments in
research and technology to generate new ideas and products and processes
that are highly valued in the world, investments in health and safety that make
places worthwhile for living, working, and visiting, and investments
in the physical environment and cultural milieu that make places more
attractive, life more rewarding, and people more motivated to work and
study hard. Thus economic strategy, as opposed to the conventional
view of local economic development, involves all of the important aspects
of public and private resources and institutions, and is necessarily
comprehensive and broad-based.
In
Akron, Ohio, the leaders of the urban region came together in an economic
crisis and created a Metropolitan Economic Strategy that maximized their
fundamental assets of people and place. Faced with the loss of
thousands of jobs in rubber tire manufacturing by the four major companies
— Goodyear, Goodrich, Firestone, and General Tire — metropolitan leaders
did not try to become another Silicon Valley and create an information
technology and telecommunications industry. Instead, they recognized
that “high technology” in today’s world involves every type of product and
production process, and that they could compete more effectively by
focusing on their own areas of expertise rather than simply trying to
imitate what other places were already doing successfully.
Since
synthetic rubber was developed in Akron during the 1940s and 1950s, Akron’s
metropolitan leaders recognized that the people and institutions within
their region had a depth of knowledge in the field of polymers — the
science and engineering of plastics and related synthetic materials.
Therefore they decided to invest more heavily in this unique
specialization, and reinvented their urban region as the world center of
polymer science and engineering, creating a whole new college and research
laboratories at the University of Akron. They put together all the
elements of a Metropolitan Economic Strategy — education, job training,
research, financing, business assistance, facility construction, physical
infrastructure, trade promotion, marketing, product development, industry
network linkages, personnel recruitment, and much more — and they
successfully implemented this strategy by generating hundreds of new
private firms and thousands of new jobs in polymer-related
activities. Akron’s public and private leadership also diversified
their economy through conventions, entertainment, recreation, and tourism,
and thus improved the quality of life vitally necessary for retaining and
attracting skilled workers and creative entrepreneurs. Akron’s
success is a good example of a major theme of Metropolitan Economic
Strategy: “Be Yourself.” The assets of
an urban region or any other geographic entity will differ from most
others, and each economic strategy must be specifically designed to
maximize the value of the existing assets of people and place that are
special to a particular culture and location.
The
second major element of Metropolitan Economic Strategy is to promote the
growth of dynamic and innovative industry networks, also called
clusters. Industry networks, as the name implies, draw upon a wide
range of closely interacting private and public sector organizations and
institutions that supply each other with goods and services to produce
specialized and competitive products and skills. These business and
agency linkages are key to the success of an industry network, and they cut
across the traditional industrial or sectoral
classifications, because in this case an economic activity such as
machinery production will include a much wider range of scientists,
engineers, lawyers, accountants, bankers, insurers, architects, designers,
and a whole host of related fields that enable machines to be manufactured
and distributed with cost-effectiveness, technological efficiency, and
market appeal, and to be sold or leased at a sufficient profit that will provide
safe jobs and decent livelihoods for a large and growing population of
workers and consumers. Industry networks that are the engines of
prosperity in the new global economy can be in manufacturing or services,
involving old or new technologies and products, from food and medicine to
computers and mobile phones. Each place will have to determine which
industry networks will be most productive, innovative, competitive, and
dynamic, based on the fundamental assets of their particular population and
location, such that polymer development will work for Akron and commercial
shipping for ocean vessels will work for Barcelona, but not the other way
around.
To
effectively grow industry networks or clusters, they must be tailor-made
for the asset base and business mix of each urban region, meaning that one
size definitely does not fit all. In this sense, the first key
element — investing in the fundamental assets — and the second key element
— growing the dynamic industry networks — are deeply interconnected, and
developing a comprehensive Metropolitan Economic Strategy involves the
specific interaction between both of these elements. Major assets
such as international airports, universities, scenic waterways, or historic
neighborhoods can promote the growth of a variety of industry networks if
planned and developed as part of an effective strategic framework. In
turn, each industry network will draw on a wide range of different assets,
with no two networks necessarily having the same needs and priorities even
in the same location. Every urban region must build on its existing
strengths, and create precisely targeted policies and incentives to
generate investment and growth that makes the best possible use of its
fundamental assets. It is important to emphasize that industry
networks or clusters only give urban regions a competitive advantage if
they are dynamic and growing. Competitive success in the new global
economy comes through fostering innovation and productivity. Industry
networks are key elements of Metropolitan Economic Strategy only to the
extent that they can help generate rising incomes and employment through
combining innovative specialization with
creative diversity. Simply identifying an urban region’s “clusters”
will do no good for strategic economic development if these clusters are
unproductive, outmoded, or stagnating.
WHY
QUALITY OF LIFE —
SUSTAINABILITY AND INCLUSIVENESS — IS NOW NECESSARY FOR GLOBAL
AND URBAN PROSPERITY
In formulating
and implementing Metropolitan Economic Strategy, improving the physical
environment and addressing economic and social inclusiveness are integral
to the overall prospects for success. This represents a change in
paradigm from the traditional concept that economic growth does not involve
environmental protection or poverty reduction, with some people and
policymakers still viewing these concerns as at least separate and perhaps
even incompatible. The progressive idea of the sustainable development
movement is that these three concerns must be balanced against each other
such that each one is taken seriously as an important societal and public
policy goal. In today’s global economy, where quality of life is
the key to attracting and retaining skilled workers, and skilled workers
are the basic building blocks of economic prosperity and competitiveness,
improving the environment and addressing social inclusiveness are no longer
luxuries to be traded off against economic growth. Indeed, they are
now absolute prerequisites for achieving and sustaining growth of jobs and
incomes, trade and technology. If a place has polluted air and
water and terrible automobile traffic congestion and unmanageable sprawl,
it may become an undesirable place for people to live, work, and visit, and
for companies to invest in and locate production facilities and personnel.
Quality
of life is an increasingly important fundamental economic asset because
global competitiveness now requires placing a premium on making it possible
for talented entrepreneurs, professionals, and skilled workers to choose
where they want to live and work. These potentially highly mobile
individuals and families are attracted to and retained by urban regions
with good housing and transportation, significant cultural and recreational
amenities, vibrant community life, and an appealing natural
environment. For example, in the US, the State of Maryland’s Smart
Growth and Neighborhood Conservation initiative, winner of a prestigious
Innovations in American Government award from the Ford Foundation and
Harvard University during the year 2000, combined environmental and open
space protection with urban regeneration and promotion of livable suburban
communities by reducing traffic congestion, air and water pollution, and
other harmful effects of excessive sprawl. Former Maryland Governor
Parris Glendening, who championed this
initiative, clearly viewed Smart Growth and Neighborhood Conservation as a
strategy for promoting high-value economic development through improved
quality of life, noting that Maryland’s economy made substantial gains in
employment and income growth after the initiative was launched in
1997. Governor Glendening cited the example
of a young technology entrepreneur who located his fast-growing company in
Annapolis — Maryland’s state capital and home of the U.S. Naval Academy —
because he enjoyed the combination of an urban environment with culture,
night life, and historic architecture, together with abundant opportunities
for boating and recreation on the Chesapeake Bay. This chief
executive decided to provide two company-owned sailboats for his workers to
use on their free time, as an innovative incentive that his firm
successfully used to attract and retain skilled employees. Many other
places around the world are increasingly taking comparable approaches to
combining environmental and open space preservation with metropolitan
land-use planning, growth management, and urban reinvestment as strategies
for enhancing sustainability and quality of life that also will generate
economic prosperity.
Indeed,
preserving and enhancing a good physical environment is now essential to
the long-run economic success for any nation, region, or community.
Public and private sector leaders are increasingly recognizing that urban
regions in the 21st century can only compete globally and become
centers of sustainable innovation if they succeed in attracting and
retaining an excellent and highly motivated workforce. Places that
offer a good environment and lifestyle — not only for working, playing, and
raising a family, but for visits by tourists, business executives, and
conventioneers — will benefit substantially from their competitive economic
advantage. This is why investing in and enhancing physical and
cultural heritage — what Global Urban Development calls “Celebrating Our
Urban Heritage” — is vital for improving the overall economic climate by substantially
improving quality of life not just for tourists, but more importantly, for
the people who live and work in the urban region. Today’s
environmentalism and related movements for sustainable development, smart
growth, and new urbanism are more than just compatible with economic
growth. Environmental protection and restoration have become fundamentally
necessary for generating and sustaining prosperity. There is a strong
case to be made for why a good environment and improved quality of life is
critically important for economic productivity, and a growing number of
economists, including Jeffrey Sachs, Joseph Stiglitz,
and Lester Thurow, support this perspective.
Protecting
and sustaining the physical and natural environment of urban regions
involves many different yet equally important actions. They include:
·
encouraging energy efficiency and resource
conservation;
·
improving clean air and conserving clean water;
·
cleaning up and redeveloping toxic and polluted
“brownfield” land;
·
renovating historic structures and investing in urban
cultural heritage;
·
maintaining the beauty of natural landscapes and
preserving agricultural land;
·
increasing the accessibility of biking and hiking
pathways and open spaces;
·
curbing metropolitan sprawl and traffic congestion;
·
reinvesting in older towns, cities, and inner-ring
suburbs;
·
expanding transit and other pedestrian and public
transportation alternatives;
·
promoting ecological and heritage tourism;
·
developing parks and recreational amenities;
·
developing “green” buildings, infrastructure, and
communities;
·
increasing recycling and the use of renewable energy
sources;
·
reducing greenhouse gas (GHG) emissions and vehicle
miles traveled (VMT);
·
strengthening community
planning and design.
As
the movement for environmental justice rightly argues, these needs are
especially pressing for low-income communities, which are generally harmed
the most by air and water pollution and exposure to a wide variety of
harmful substances and unhealthy conditions. Urban regions such as
Curitiba in Brazil and Portland (Oregon/Washington) in the US have made environmental
improvement and protection a centerpiece of their Metropolitan Economic
Strategy to compete more effectively in the global marketplace by
attracting and growing cleaner industry networks in both manufacturing and
services.
Similarly,
if a place has high crime, social unrest, disease, and deterioration, it
may become unattractive and undesirable for a quality workforce and
thriving employers. The economic development plan for Johannesburg, Joburg 2030, acknowledged the vital
economic importance of social inclusiveness and investing in disadvantaged
people and communities when it listed as four major barriers to achieving
economic success: high crime, physical deterioration of the inner city and
outer townships, the HIV-AIDS pandemic, and lack of sufficient education
and skills by a large proportion of the workforce. Both Cape Town and
Durban, South Africa, recently adopted economic development strategies that
include a significant focus on policies to raise incomes, increase jobs and
business opportunities, and improve the quality of life for low-income
families and neighborhoods. Cape Town calls it “Our Golden Thread”:
It is
not a question of choosing global competitiveness or the reduction
of poverty — Cape Town will achieve both or neither. Reducing poverty
will strengthen global competitiveness, and global competitiveness will
permit reduction of poverty through economic growth and job creation.
Singapore,
for example, has done an excellent job of recognizing that its greatest asset
is its people, and that in order to have a well-motivated and highly
productive workforce, everyone must share in the fruits of
prosperity. With the goal of economic and social inclusiveness in
mind, Singapore moved from being a relatively poor British colony and
international seaport during the 1950s to virtually eliminating poverty
since becoming an independent nation in the 1960s. The national
homeownership rate in Singapore is more than 90%, and jobs, transportation,
infrastructure, housing, education, health care, environment, and per
capita incomes have all improved dramatically in this “city-state” over the
past four decades.
CONCLUSION
It
should now be clear that Metropolitan Economic Strategy is a new global
paradigm and policy initiative that is increasingly essential for
generating and maintaining a vibrant and prosperous economy for everyone
and every place in the world. Issues that generally were considered
to be separate and distinct from economic growth and development, including
a sustainable living environment, social inclusiveness, cultural diversity,
spiritual values, honoring historical traditions, governance, citizenship,
identity, security, cohesion, and other similar “non-economic” concerns are
now completely tied to the future performance and competitiveness of the
economy in the global marketplace. “Urban policy” must now become the
centerpiece of international and national macroeconomic policy, because
urban regions are the dynamic engines of innovation and productivity for
the world, and they can more efficiently produce and distribute the
resources that provide better livelihoods for urban and rural residents
alike.
In order
to have a good economy today and in the future, urban regions must have a
good quality of life. Good quality of life requires a good physical,
social, political, and cultural environment. The rising importance of
quality of life for economic prosperity — specifically the vital need for
sustainability and inclusiveness — is an entirely new paradigm for the 21st
century. The best way to address these new realities is for every nation,
region, and community to adopt the framework of Metropolitan Economic
Strategy. Then they can all work together cooperatively to design and
implement successful economic strategies that invest in their fundamental
assets and grow dynamic industry networks simply by being themselves.
This can only be achieved, however, with good leadership, cooperative
governance, and a common sense of purpose and mutual identity called “Teamwork.”
Marc
A. Weiss is Chairman and CEO of Global Urban Development, and
Executive Editor of Global Urban Development Magazine. Dr. Weiss
is the author of The Rise of the Community Builders and co-author of
Real Estate Development Principles and Process. He served as
Special Assistant to the Secretary of the US Department of Housing and
Urban Development and HUD Liaison to the President's Council on Sustainable
Development in the administration of President Clinton, and as Coordinator
of the 1998 Strategic Economic Development Plan for Washington, DC.
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