Dimensions of Local Economic Development: Towards a Multi-level, Multi Actor Model

Bartjan Pennink
(Faculty of Economics and Business, Department of Global Economics and Management, University of Groningen, 9712 CP Groningen, The Netherlands)

Abstract: Stimulating local economic development or starting this process is not an easy task. Even harder is the development of theories on this process. In this paper we want to work out a model that brings together social entrepreneurship, the different levels: macro, meso and micro and the local communities with the help of existing literature and our experiences with setting up local economic activities in several projects carried out in Indonesia in cooperation with Ministry of Planning in Indonesia and the ITB in Bandung. The work of Stimson (Stimson et al., 2009) on local economic development is a good start but only focusing on the endogenous factor in a region they exclude two levels: the local and the national/international level. For the local level we can use the work of Canzanelli (2001, p. 9) who describes LED as a process in which local actors shape and share the future of their territory. He defines LED as a process in which local stakeholders work closely together. Such a process will stimulate and facilitate partnership between local stakeholders, enabling the joint design and implementation of strategies. This will be mainly based on competitive use of the available local resources with the final aim of creating decent jobs and sustainable economic activities. For the national level we can use the models from the triple helix idea’s (Pennink, 2012).

Key words: local economic development; triple helix; global value chain; local communities

JEL code: O112