Taking a holistic approach to local development involves considering both economic and social outcomes, focusing on how a place can enhance its economic future, quality of life, and opportunities for all residents by leveraging a broad range of local assets. A variety of local resources and capitals can contribute, with factors such as local skills systems, industrial clusters, and economic complexity playing important roles. Local “soft” infrastructure, such as leadership and social capital, also underpins all of these policy successes – or failures.
To date, many policy interventions to address divides between and within communities have fallen short. Demographic change, globalization (or the retreat from it), technological progress, and climate change are bringing additional pressures for local transformation. While these factors provide ample opportunities for communities, they can also threaten to push some even further behind.
Addressing these risks and developing “future-proof” policies going forward will require going beyond business as usual. Various strategies for successful place transformation are needed to create sustainable results. Local leaders and policymakers will need to diversify the local economy by building on transferable skills, doubling down on comparative advantages, and capturing the benefits of integrating into global value chains. This will help them reckon with the scars from the past while preparing for future changes.