The Role of Entrepreneurship Theory and Methods, Practice and Policy
Edited by Sameeksha Desai, Peter Nijkamp and Roger R. Stough
Chapter 1: New Directions in Regional Economic Development: An Introduction
Roger R. Stough, Sameeksha Desai and Peter Nijkamp 1.1 INTRODUCTION The field of regional economic development has been transformed by the emergence of endogenous economic growth theory (Romer, 1986, 1990). It has unleashed a flurry of new hypotheses and related inquiries that have in turn created an exciting dynamic in the conceptual, theoretical and empirical foundations of the field. The central feature of the endogenous perspective at the local regional level is the recognition that local initiative matters in how a region grows, adapts to change and adjusts to disequilibrating physical and societal shocks. These include but are not limited to climate change and weather phenomena such as hurricanes, tsunamis and droughts, as well as other non-physical events including wars, cyclical change, new technology and paradigmatic political change. While macrolevel resource and development adjustments as always are important for adapting to such shocks, local regions make positive growth-inducing adjustments when they marshal local leadership (Stimson et al., 2009) and use local resources to plan for and drive toward a fruitful adjustment or transformative course for growth and development. It is against this contextual background that we examine some of the new directions in regional economic development. A major tenet of endogenous growth thinking is that technical change in the first place occurs at the local regional level, thereby focusing and in fact revolutionizing the Solow (1956) seminal conclusion that technological change was the variable that accounted for the discovery that classical factors of production barely explained half of the variance...