How regions succeed

thenextwavefutures — Fri, 26 Jun 2009 20:22:03 +0000

Strangely I’ve had a couple of recently written articles released into the wild within a few days of each other. One was written for ‘Made in the UK’, a book sponsored by the BBC about the impact of spreading its production and broadcast facilities more evenly across the UK. My contribution – sandwiched between those of the Director of Vision, Jana Bennett, and David Attenborough – looked at the underlying theory as to how, and why, regions succeed. It’s an area which I’ve done some research and writing about, and some work on, over the last decade. The BBC book enabled me to develop my thinking – which is that successful regions manage create a dynamic in which the local economy interacts with local social betworks and a sense of place – and that public investment is essential to the process.

The article’s not long, so I’m not to going to expand at length here, but what I tried to do was to move beyond the relatively narrow economic view proposed by Michael Porter (which was basically an update of Alfred Marshall’s pioneering work in the 19th century about how and why industrial sectors evolved). Instead I wanted also to take account of social and cultural factors, and also the role of place and public realm.

The other important factors are time and persistence. Part of my argument is about the evolution of types of knowledge capital in a region, from intellectual capital (in an individual) to human capital (in an organisation) to social capital (in a group or network) to cultural capital (in a place). It can take 30 years to embed cultural capital in a region, and many of the components which are essential to the process – as capability and resources feed on each other, and grow – can come only through public investment. As the article argues,

Cultural capital and social capital are both social constructs which depend, crucially, on public investment over a prolonged period of time in what one might call public capital—human, cultural, and social. The reason for this is a straightforward matter of economics: as James Coleman has observed, such capital is a ‘public good’, and as with all public goods, there will not be enough investment in it if it is left to the market.

So the model of regional development needs to have public investment at its heart. And some of the results can be unpredictable. When people tallk about the unintended consequence of public policy, they always have bad consequences in mind. But there can be good unintended consequences as well.Which, of course, makes outcomes harder to measure.

As the article observes, “One of the outcomes of the expenditure on art colleges in Britain in the ‘60s and ‘70s, for example, was a lot of good rock and roll—from The Beatles to The Who to The Kinks to Roxy Music. (The art schools also produced, as intended, a lot of good designers and creative directors.) … Even though it was a valuable outcome, both culturally and economically, it was not intended and could not have been anticipated.”

There’s a related article in my Selected Articles page on ‘Architectures of the Future‘ on the connection between different types of public spending and the shape of urban space. (Scroll down!)

Made in the UK was published for the BBC by Premium Publishing.

regional development – the next wave

How regions succeed