Tech economy and local economic policies and strategies

The practice of economic development has changed dramatically since the mid-twentieth century. Cities have been challenged to remake themselves around a fundamental shift in the urban economy: from systems dominated by manufacturing- to technology and information-based systems.

Local policy makers are trying to take advantage of the opportunities created by technology to develop their local economies through a wide variety of policies (e.g., relating to taxation, financial services, infrastructure, immigration, industry support, and quality of life). While most agree on the overall benefits of these policies, there is debate about which are the most effective. Some scholars such as Moretti (2012) and Noah (2013) believe that people follow jobs. Thus policies that revolve around job creation are viewed as the most direct path to economic growth. Scholars in this camp tend to support pro smokestack chasing strategies and claim that developing business friendly strategies including tax incentives, co-work spaces, and training are the most effective approach to local economic development.

On the other hand, there are a number of scholars such as Graves (mid1970s), Florida (2002), and Glaeser (2005) who represent the jobs-follow-people paradigm. They believe in the role of the amenity-driven strategies in speeding up the local economic development. Thus, scholars in this group argue that investments in quality of life, such as green spaces, bicycle lanes and cultural amenities are most likely to generate the conditions necessary for vibrant local economic development today.

I assume that economic development around digital and information based systems in cities, may well demand a unique set of strategies, not currently captured in the bifurcated debates which pit job creation against amenity driven development. However, based on the most of the surveys, livability indicators that includes parks, open spaces and recreational places, city cleanliness and public safety could be the most important reasons for locating in a city.


Bartik, T. (1994) what should the federal government be doing about urban economic development? Cityscape

Florida, R. (2002). The rise of the creative class: And how it’s transforming work, leisure, community and everyday life. New York, NY.

Storper, M. (2008). Why does a city grow? Specialization, human capital, or institutions? Urban Studies, 47.

Moretti, E. (2012) the new geography of jobs. New York, NY.