Community Economic Development
Economic Development Reference Guide. Neighborhood Economic Development. International Economic Development Council.
Neighborhood revitalization seeks to improve a neighborhood’s physical, economic and social conditions to improve the overall quality of life and economic opportunities for neighborhood residents. Like downtown development, it includes a range of initiatives that target multiple but complementary development goals including business development, infrastructure improvements, workforce training, façade improvements, amenity development and property reuse. Critical to this process is the revitalization of commercial areas, because it creates jobs for local residents, provides goods and services to the local market thereby keeping local dollars in the community, and improves overall image of the neighborhood by signaling that business can succeed there.
Many organizations in the community should contribute to neighborhood revitalization. Ultimately, successful revitalization efforts will have leveraged public, private and community resources to achieve a commonly held vision for the neighborhood, and the city more widely.
Community economic development (CED) initiatives expanded rapidly in urban and regional policy in the 1990s. Traditional evaluation method has however, proved to be extremely difficult to apply effectively to CED.
book The Fifth Discipline explores systems thinking as a discipline for seeing wholes, for shifting away from narrowing the focus to one particular part and instead expanding it to many parts that have an impact upon one another. The goal of using systems thinking in a community setting is to have community participants shift from being reactors to viewing themselves “as active participants in shaping their reality, from reacting to the present to creating the future.” On the other hand, a linear or otherwise nonsystemic view may erroneously suggest that some persons or entity has singular responsibility for an identified problem or solution. Seeing the individuals action apart from the underlying structure of the actions and their influence process could run the risk of remaining powerless to affect change in complex situations. However, in viewing a community as a complex system, the interrelationships that cannot be readily seen can be explored. In tandem with dialogue, systems dynamics modeling would be useful at several stages of a community project as part of contracting, the technique helps the consultant move beyond the initial problem and identify possible points of intervention.
In paraphrasing Pope John Paul II, in Centesimus Annus, Stackhouse writes that the two key forces likely to have the most direct bearing on the future are corporations and religion. Corporations are the instrument of economic productivity for the foreseeable future, and religion is the bearer of those decisive values by which we guide our production, distribution, and consumption of whatever wealth is generated.
(1920) and (1996) srgue that economic and religious motives and institutions profoundly affect daily life. vision that a larger entity governing community development in low-income neighborhoods is an example of this. He posited that the larger social issues of racism and classicism manifest themselves in religious, political, and economic institutions. Furthermore, knows of the changing economy and its implications for securing livable-wage employment but he underscores efforts of local initiatives similar to CDC’s. What differentiates his model on a relocated leadership, a race and class – reconciled people, a redistribution predicted on relocation and reconciliation, and on the pivotal role of the parish church. The efforts of this leadership through a parish church and CDC engender the change and support necessary for low-income residents to respond to community development efforts.
The debate on the economic component of community revitalization strategies for inner-city development reveals a growing interest among academics and community scholars. The faction has been divided; several discussants challenged Porter’s conventional notions of economic growth and development through individual self interest and the profit motive. Many imply that if revitalization is to target both human needs and human potential, then cooperation and collaboration are key components of a comprehensive and holistic strategy. Many who worry about the survival of inner cities recognize that collaboration and cooperation are and will continue to be critical elements in any strategy of community revitalization. The public sector, granting agencies, and community organizations are all considering partnerships around these principles, with increased discussion of economic development through collaborations and cooperation) as key components of social development.
The propose strategy of income and wealth accumulation through private enterprise development is not broad enough to respond to community concerns associated with housing, economic development, neighborhood revitalization, infrastructure development, health care, job training, education, crime prevention, and planning and community organizing, in a post-industrial, globalized economy. The reality is that the needs in these areas call for a comprehensive, holistic, and well-coordinated community-wide set of strategies which incorporate the building of creative, productive, and sustainable mechanisms of survival and prosperity which better the quality of life. Inner city revitalization and community economic development must mean good jobs, economic empowerment, and community cultural, political and social development- simultaneously.
(1999) presented a the four-level framework for community development system as a way to analyze efforts to improve the quality of life in low-income communities in the urban United States. The four leveles are: level zero (the grassroots or informal neighborhood organization), level one (front-line organizations that directly serve level zero), level two (local support or city- or metropolitan-level policy-makers, funders and technical assistants), and level three (non-local support). These levels describe the division of roles and responsibilities in the community development system and provide a means to analyze the ways in which its actors (people and organizations) relate to one another. In particular, the framework clarifies how, due to their differing roles, responsibilities, and interests, participants at different levels in the system may appear to have conflicting values and commitments even when they are in fact the same. Thus, it may be used to strengthen alliance building by helping people to see what they have in common, what they do not, and how they can work together more productively.
Despite macro-economic processes working against them, many people (both inside and outside low-income neighborhoods) are committed to improving conditions in them. Their efforts are often referred to as community development. According to (1999), the community development is asset building that enhances the quality of life of residents in low to moderate income communities, where communities are defined as neighborhood or multi-neighborhood areas. Thus, they divided assets into five parts: physical (buildings, land, tools, etc.), financial (all standard forms of financial wealth), intellectual and human (individual skills, knowledge and confidence), social (all formal and informal relationships, cultural norms, and shared understanding), and political (the capacity to exert political influence) ( 1999).
The rapid growth of the CDC movement has rested on its ability to articulate a unifying vision into action in a way that dramatically expanded both the resources available to the field and the major stakeholders in its success. As resources threaten to contract significantly, the movement’s future vitality lies in further diversification, organizational adaptation to new roles, and identification of additional partners and stakeholders.
Despite dramatic and unfortunate changes in the nation’s urban neighborhoods and its political and fiscal climate since the community development movement began 30 years ago, the movement began 30 years ago and has matured into an industry. The vision for community development in the early 1980s was squarely grounded in the visible distress of central city neighborhoods, primarily in neighborhoods with color. Some had been devastated by urban renewal. Some had suffered damage in the riots that followed the assassination of Martin Luther King. Many were disillusioned by the unkept promises of the War on Poverty. Virtually, all had suffered badly in the national recessions of 1975-1977, which hit the nation hard and central cities even harder (1980).
Spatial segregation of racial and ethnic groups may theoretically have positive or negative effects on the economic performance of those groups. ( 1997) examined the economic performance of racially segregated groups and found out that blacks in more segregated areas have significantly worse outcomes than blacks in less segregated areas.
Racial segregation is the norm in urban America: on the average, 60% of blacks would have to change residents to create an even distribution of the races across neighborhoods, and the average black lives in a neighborhood that is 57% black. The spatial segregation of blacks from jobs, positive role models, and high quality local public goods has led some to speculate that segregation is a cause of the problems of the black underclass (1993).
Urban social movements for civil rights, historic preservation, decentralized control of public services, and new environmental values inspired many citizens to participate in planning at the local and state levels for the first time. These movements created activists and organizations, planning processes, and public forums in which citizens began to make their multiple claims for diverse and emerging communities within the same political boundaries. The expansion of the public realm through citizen action ha provided both hard experience and creative opportunity to directly encounter the competing claims and values of others and to discover the dimensions of common ground for mutual benefit.
(1996) argues that our understanding of urban community today needs to be a story of the historical efforts and the ongoing choices that people make regarding their participation in an urban environment rather than debates over mutually exclusive views of the past or the ideal forms civic institutions should take. While community has no objective life of its own, it exists in multiple discourse and social practices that shape the way people define themselves. People create or challenge their right to make moral and economic claims on one another based on categories of race, class, gender, and generational lifestyles, among others.
Community Economic Development (CED) is a distinctive form of community development practice that has grown increasingly important during the past decade. Advocates place prime importance on creating non-profit organizations and other organizational vehicles to attract capital and localize control over the development of housing and business in low-income neighborhoods and within communities of color.
A central line of practice and research involves nonprofit community development corporations (CDCs), which operate as investment vehicles and service providers in central-city neighborhoods and poor rural areas. As (1976) describes it, the initial impetus for CDCs came from African American, Native American, and Latino leadership seeking investment in their historically segregated and poor neighborhoods. and (1987) describe three generations of CDCs and citizen action groups over the past twenty years. Interest in CDCs has grown along with their rapid growth in numbers since 1980. The (1988) publication presents a snapshot survey of 835 CDCs in 1988.
Haberfeld (1981) discussed the distinctive aspects of the grassroots or nonprofit approach to CED and the need for partisan in action in low-income and African American communities specifically.
CRITIC ON CDCS and CED
(1970) offers a highly negative analysis of the African American control movements of the 1960s. (1990) and Traynor (1993) argue that CDCs have become too dependent on technical expertise and need to return to an ethic of empowering poor citizens to become involved in planning and public policy for their neighborhoods. The authors in a special issue of Economic Development Quarterly (1989) represented public policy perspectives on the field. They use the term “neighborhood economic development” to refer to publicly initiated programs for financing infrastructure, housing, business attraction, job training, and commercial development in poor neighborhoods and poor rural areas. Both (1994) and (1989) criticize the strategy of bringing jobs into poor neighborhoods and call for organizing for increased services ( 1989) or increasing incomes in poor households through direct federal assistance ( 1994).
Low income communities throughout the United States are caught in a downward spiral in quality of life as a result of deteriorating economic and social conditions (1985). The breach between the haves and have-nots is an increasingly serious threat to society ( 1992; 1991;1993). Despite the importance of social service institutions do not deliver opportunity to support positive change.
The systemic nature of poverty, including interaction of issues and problems, makes intervention especially challenging. The failure of urban policy is in large part due to interventions that are less than systematic in their own approach. Such ill-conceived policy, which fails to consult with the community about development priorities and intervention strategies, may actually contribute to, rather than alleviate, problems and manifestations of poverty (1993; 1992).
Out of dissatisfactions, new efforts have evolved in both US and Latin American low-income communities that point in the same direction: community economic development, if its truly to empower people, must build community from the inside out- from the individual’s realization of self-efficiency and interconnectedness with the larger community. Practitioners are discovering the pivotal role of the individual as subject-not object of community economic development and social change.
For many grassroots movements, empowerment involves a strong spiritual dimension. As a rule, the necessity for a spiritual dimension, and for the revival of the sacred in one’s everyday relationships with the world, seems to be rediscovered as a basic factor for the regeneration of people’s space. Thus, wherever this spiritual dimension has been present, it has, indeed, produced a staggering contagion of intelligence and creativity (1993).
The spiritual dimension to community-based economic development is also seen in the desire for belonging to something larger than oneself: community building, along with a sense of interconnectedness and a desire for service. , founder of the National Center for Neighborhood Enterprise, recalls that the most successful efforts at community economic development over his last 20 years have been those not on material ends but rather on a larger sense meaning, i.e. spirituality (1994). The spiritual dimension –like transpersonal psychology and transformational politics—provides not only a path for the inner empowerment, but a sense of connection with, and responsibility to, the larger community and all of humanity.
Community Economic Development must arise from black churches, historically black colleges and universities, African-American officials, business leaders, teachers, and health and welfare professionals. In the real world, where group welfare functions are interdependent, only two possible long-term outcomes are both just and stable.
A central tenet of Browne’s work on community economic development is the importance of institution-building as a necessary condition for urban revitalization. While skills, commitment, expertise, money and a host of other tangible and intangible resources must be present in black economic development which are precisely the resources that can be best mobilize through the creation of appropriate institutions. Thus, Browne asserts that dilemma of the black community is that it finds itself in the midst of a capitalistic society but virtually without capital. In his view, the major problem in the developing black community is that after consuming their income, little or nothing is left behind within the community the community to serve as a productive base for future expansion.
Several other studies since 1988 have confirmed the Atlanta finding that even after controlling for income, education, and job security, blacks were four times less likely to be approved for conventional bank loans than whites with the same profile.
Communities today are redefining themselves to encompass broader geographic areas. Building a community coalition requires paying attention to the human aspect of development in addition to the technical considerations. The purpose of coalition is to take charge of change rather than reacting to it. Strategic planning is a tool to do this which articulates goals and outlines steps needed to create change.
The central proposition of the spatial mismatch hypothesis is that the steady dispersal of employment (especially low-skilled jobs) from central cities, combined with limitations on the residential choices of African Americans (which result in highly segregated residential neighborhoods), accounts for low levels of employment and earnings in those neighborhoods.
The policy challenge community development addresses is to ensure that the residents of poor and at-risk neighborhoods who do not leave have the opportunity to live safer, more civil, more productive lives than is now possible in many inner-city neighborhood. If this goal is accomplished, these communities may regain their ability to attract and sustain a mix of people with moderate incomes and connections to the labor force.
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