Abstract
Many factors contribute to growing inequalities in the United States. This commentary identifies three common assumptions inherent to economic development practice that may contribute to these dynamics within cities and regions. By looking beyond the economic development literature, the author presents a framework that prioritizes equitable outcomes for economic development: looking in, leveraging, and locking (3Ls). Looking in refers to a process whereby stakeholders assess existing formal and informal assets to address economic concerns. Leveraging refers to how stakeholders may collectively draw from existing assets to garner additional resources to achieve shared priorities. Locking refers to ensuring that economic development activities benefit residents, particularly those most marginalized and economically vulnerable. This commentary then compares the 3L framework to others, assessing how each may be useful in advancing more equitable economic outcomes in the United States.
Keywords
Growing income and wealth inequality is clearly a problem in the United States. Incomes have risen unevenly for different segments of the population, with upper-income households generally making greater gains than middle- and lower-income households (Kochhar & Sechopouos, 2022). Wealth also continues to be concentrated among fewer Americans: the wealthiest 10% of households held approximately 70% of total wealth in 2019 (Healthcote et al., 2023). Homeownership—one of the primary means to build wealth in the United States—continues to be out of reach for many Americans (Joint Center for Housing Studies of Harvard University, 2023). It is well-known by now that these persistent disparities dovetail with racial inequalities (McCay, 2022).
Yet the U.S. economy has experienced aggregate growth (measured by per capita gross domestic product) of 2% per year over the past 150 years (Jones, 2016). Median household incomes have also generally continued to rise since the 1970s, despite increasing income inequalities in that time (Piketty & Saez, 2003). Clearly, economic benefits have not been shared equally. Further, disparities are manifested geographically. While population shifts have occurred since the Covid-19 pandemic (Berurbe, 2024), “superstar cities” continue to amass scientific innovation, talent, and wealth, exacerbating inequalities between communities and regions (Gruber & Johnson, 2019). At the local level, uneven geographies of opportunity continue to perpetuate intergenerational disadvantages for residents (Chetty & Hendren, 2018).
While no lone factor drives these dynamics, one must ask: What role does economic development, as a set of policies and practices, have to play in promoting (or not) local prosperity? If the field is contributing to these disparities, are there ways in which it may better serve people and places?
I identify three key assumptions within conventional economic development that may thwart practitioners’ efforts to promote more equitable economic outcomes at the local level:
Economic development best practices will promote benefits that eventually trickle down to most, if not all, residents. Answers to economic challenges can be found outside of a community; locales must incentivize and attract “the right” kinds of companies and talent. All places are equally capable of engaging in conventional economic development practices.
While economic development scholars may debate the extent to which some of these assumptions may or may not be true, such assumptions are arguably established baselines from which many practitioners operate. Are we in need of a refresh?
This commentary leaves the confines of economic development scholarship, presenting alternative literatures spanning the fields of geography, community development, and organizational studies to examine how economic development policy and practice may promote more equitable outcomes. The alternative literatures include the community capitals framework, asset-based community development (ABCD), the theory of community economies, and the idea of “scaling deep.”
Through a synthesis of these literatures, I offer a three-part asset-based framework—looking in, leveraging, and locking (3Ls)—with examples of how this model works in practice. Briefly, looking in refers to the process whereby local leaders (broadly defined) address local concerns by assessing existing formal and informal assets of a place. Leveraging refers to the process by which leaders use these assets to garner more resources to achieve common goals. Finally, locking entails instituting policies and practices that better ensure that residents, particularly those most marginalized and economically vulnerable, directly benefit from economic development initiatives. Ideally, these actions spur virtuous cycles of economic activity, which may facilitate wealth building and strengthen communities, more generally. I then demonstrate the utility of the 3L framework through a comparison of other asset-based frameworks. Ultimately, the 3L framework emphasizes the importance of identifying and nurturing existing assets, collaborating to leverage these assets, and creating the conditions to promote more equitable economic outcomes.
Conventional Economic Development Approaches
Typically, economic development entails business recruitment, retention, expansion, and entrepreneurship. Economic development practitioners usually engage in these activities to instigate external regional demand for products and services, which ideally promote a range of benefits: job growth; growth of firms that support exportable goods and services; infrastructure development and expansion of local services; population growth; and a growing tax base. Doing otherwise may spark concerns of economic stagnation and decline (Hill, 2023). Inherent to much conventional economic development practice is the assumption that the entry or expansion of a firm or industry will produce positive multiplier and spillover effects in the regional economy; as core industries in a region thrive, so will everyone else, the thinking goes. To this end, many economic developers rely on a common set of tools to attract and retain the “right” people, industries, and/or firms while also attempting – to varying degrees – to improve economic opportunities for existing residents (often through workforce development initiatives and incentives). In practice, the degree to which locales pursue conventional approaches varies as different places pursue their own strategies; yet conventional approaches are arguably still pervasive. Below, I outline three key issues associated with such approaches.
Problem #1: Economic Development Best Practices May Not Confer Benefits to All Residents Equally
The current focus on high-tech firms and recruiting highly skilled workers in many cities and regions may be problematic. Here, I use “high-tech” broadly to refer to activities that promote tech-based innovation. Many practitioners and policy makers assume that the inflow and/or growth of such firms and workers will benefit the local economy that once clustered together will promote knowledge spillovers, triggering more innovation and economic growth (Moretti, 2013). While the high-tech sector may benefit local economies and the nation as a whole (Moretti, 2021), the associated jobs most often benefit individuals with higher levels of formal education. Lee and Rodríguez-Pose (2016), for instance, concluded that scant evidence exists to prove that this sector reduces poverty in locales. In fact, the entry of high-tech firms may potentially promote residential displacement among low-skilled, low-income renters in some places (Qian & Tan, 2021). Similarly, efforts to create innovation districts, or locales that emphasize “scientific research, university spillovers, and fast-tracking innovations to the market” (Kayanan et al., 2022, p. 343) may also drive inequality by contributing to neighborhood demographic change (Kayanan et al., 2022). In the case of university-sponsored innovation districts, Wolf-Powers (2022) warned that key stakeholders must ensure that residents, particularly low-income residents of color, can stay in place for the long term to benefit from the neighborhood changes resulting from such developments.
More generally, economic development incentives—often in the form of tax exemptions, credits, abatements, and deductions—are key tools in economic development professionals’ toolkits. However, research on incentives is mixed, at best. For instance, their effectiveness in creating employment opportunities is inconsistent (Drucker et al., 2018) and jobs, particularly in the high-tech sector, are often filled by in-migrants (Bartik, 2019). Research on tax increment financing and historic tax credits—two of the most used tools among economic developers across the United States—may have long-term negative impacts on communities, particularly on public school education (Bartik, 2018; Merriman, 2018; Wen et al., 2021).
Further, historic tax credits may, depending on context, promote gentrification, simply defined here as neighborhood change resulting from the inflow of higher-income residents into lower-income areas (Kinahan, 2019; McCabe & Ellen, 2016). Despite these many concerns, incentives are likely to remain a permanent feature of economic development practice and as a result, researchers increasingly call for more reform, evaluation, and oversight (Baily, 2023; Germán & Parilla, 2021; Slattery & Zidar, 2020). In fact, strategic deployment of incentives is associated with positive employment outcomes, particularly when incentives go to smaller firms and are used in places with balanced economic development portfolios (Donegan et al., 2021).
Problem #2: Current Practices are Often Outward-Facing and Account for A Relatively Narrow Range of Assets
Economic developers often look to external markets, talent pools, and firms to promote economic growth. For instance, services such as makemymove.com act as a marketplace for remote workers to relocate to smaller communities. While some may argue that practitioners increasingly attempt to cultivate local entrepreneurship, many currently look to support a narrow subset of local creative entrepreneurs (Florida, 2019) to promote high-growth and/or high-tech businesses.
Although many economic developers are concerned about promoting equitable economic outcomes, low-income communities of color and/or individuals with less formal education may not always be considered as key contributors to innovation in a locale. Lowe (2021) pointed to the importance of prioritizing and incorporating the expertise of workers, particularly frontline industrial workers, to promote technological innovation in firms and industries, leading to more “inclusive innovation” (p. 153). And while community colleges or workforce development agencies are looked to upskill current residents, these entities may not always strategically coordinate among the web of economic development actors (e.g., chambers of commerce, government agencies, community colleges, nonprofits, and businesses) to ensure that individuals in the workforce development system are successfully connected to living-wage jobs in high-growth industries. Additionally, workforce development programs may not offer sufficient wrap-around services to make programs more accessible (Clogston & Kock, 2022). Obviously, more can be done.
Problem #3: Cities and Regions Are Not Equally Capable of Engaging in Conventional Economic Development Practices
Not all locales within the United States are equally capable of engaging in conventional economic development. Many small and midsized cities (defined here as those with populations ranging from 50,000 to 500,000) continue to lose population and major anchor institutions. Smaller cities may also have less capacity and fewer resources than their larger peers, such as labor and talent constraints, fewer corporate and philanthropic investors, and limited public budgets (Burayidi, 2018; Connolly et al., 2022; Schilling et al., 2023).
As many practitioners in smaller and less-resourced locales try to create innovation-driven economies, they may face a myriad of additional challenges and pressures: fewer creative class amenities in downtowns that have yet to be revitalized, less investment interest in start-ups or alternative investments, and relatedly, less capital to incentivize high-tech and high-growth companies and talent to relocate and/or stay (Kwon et al., forthcoming 2025).
Alternative Theoretical Frameworks
This section explores four alternative theoretical frameworks that may help to disrupt the tendencies within economic development practice that potentially exacerbate inequalities in locales. They are: 1) the community capitals framework, 2) asset-based community development, 3) the community economies framework, and 4) the concept of scaling deep.
The
Different types of capital work in conjunction to form a process of either “spiraling up” or “spiraling down” (Figure 1). In spiraling up, a community utilizes assets that will activate others, creating a virtuous cycle of asset development. Alternatively, spiraling down entails the decline of various types of capital in a community. For example, a shrinking population may trigger deteriorating local infrastructure and waning social capital as people leave. Over time, the community may experience less political influence in the region given lower population numbers (Emery & Flora, 2006). A key goal with this framework is determining how to activate different types of existing capital through social networks to create a spiraling-up effect.
The Spiraling of Capital Assets (Emery & Flora, 2006).
Similarly, asset-based community development considers local assets as the building blocks for achieving sustainable communities. Like the community capitals framework, ABCD encourages practitioners to view communities through a glass-half-full lens—that is, with the belief that all communities have assets that can be leveraged to address local needs. ABCD identifies six core local assets: resident skills; associations; public, private, and nonprofit institutions; physical infrastructure and space; economic resources; and history and culture. In effect, the ABCD framework helps community members see themselves not as clients or consumers but as individuals capable of improving their lives and communities through collective action (Kretzmann & McKnight, 1993).
In practice, community members must first systematically identify, or map, assets at the individual, associational, and institutional levels (as depicted in Figure 2). This step helps unearth existing and new opportunities for community exchange and support and must be done prior to searching for external resources; doing otherwise thwarts community-led change. Outside resources may also be more effectively used once communities have a clearer sense of existing resource gaps. Such efforts may yield stronger social networks and a greater sense of community, greater coordination among different local actors and institutions, and a greater sense of self-sufficiency in tackling neighborhood issues (Kretzmann & McKnight, 1993).
Community Assets Map (Kretzmann & McKnight, 1993).
Ultimately, the community capitals and ABCD frameworks are asset-based approaches that are internally focused and relationship-driven as both rely heavily on building trust and collaboration among community members to spur change. However, critics argue that ABCD fails to offer clear guidance on how to address issues of poverty and neighborhood disinvestment, and that initiatives based on ABCD and the community capitals framework are mostly descriptive (Ennis & West, 2010; Mueller et al., 2020; Ward, 2023). In addition, neither focuses extensively on how to change systems that perpetuate social, economic, and political inequalities. This does not mean that these frameworks cannot spark systemic change; they simply draw less attention to problematic aspects of our conceptualizations of “the economy” and how these impact policy and practice.
By contrast, the
The Diverse Economies Iceberg in Figure 3 (Community Economies Collective, n.d.) is a visual representation of this approach. Economic activities shown above the water line typically account for “the economy” while the vast number of other activities and entities that fall below are often unaccounted for or less recognized but are integral to supporting formal economic activities.
The Diverse Economies Iceberg (Community Economies Collective, n.d.).
Essentially, the authors point to how the market is not disassociated with society but is a product of it. This opens the door to reconsidering our ideas about what the economy could be and how it could better serve all people. Like the community capitals and ABCD frameworks, this approach favors a glass-half-full lens: All communities have assets and community members engage in various economic activities that can contribute to their local economies.
This approach differs from previous frameworks by emphasizing the importance of the commons—resources available to all members of society to promote their well-being (e.g., community facilities and publicly accessible land). Perhaps not surprisingly, Gibson-Graham (2006) relied heavily on examples of collective ownership (e.g., worker cooperatives) and mission-driven organizations.
Finally, from the field of organizational studies, Kim and Kim (2022) introduced the idea of scaling deep, or the “process whereby an organization pursues enduring growth anchored to its original location” to identify how entrepreneurs may better contribute to local economic revitalization (Kim & Kim, 2022, p. 1732). A key part of scaling deep entails drawing from local knowledge and resources so that firms may tailor products and services to local needs and economies. To do this, entrepreneurs must tap into local networks and develop deep connections with residents, necessitating relatively slow, but sustainable growth. The opposite of scaling deep is “scaling up,” wherein an organization pursues fast growth. This is more typical for start-up businesses backed by investors who often assume that firms will grow quickly and then be sold for profit. Kim and Kim (2022) suggested that while such firms may contribute to local job growth, economic benefits often dissipate over time, partly because such companies eventually move to places with more financial and industry-specific resources (e.g., larger cities with more venture capital investors). In effect, if entrepreneurs wish to promote local and sustainable economic growth, scaling deep is the way to go.
Like Gibson-Graham's (2006) call to reevaluate what we mean by the economy, Kim and Kim (2022) asked readers to question the idea of growth in venture capital ecosystems: If venture capitalists choose to work with mission-driven entrepreneurs who are committed to promoting sustainable local economies, do investors need to reconsider their growth strategies to support such enterprises?
In sum, these frameworks assume that all communities have assets that may be leveraged to address their needs. Further, community organizations and institutions play a key role in all these frameworks because they act as primary mechanisms by which individuals channel collective efforts. Social capital also plays a major role, acting as the gel that enables people to work together —it enables the spiraling up effect in the community capitals framework, facilitates the coordination of goods and services between different community actors and institutions in the ABCD framework, and allows entrepreneurs to scale deep. These frameworks account for various ways in which communities with fewer resources may become more economically stable, recirculating and growing local assets. Finally, they point to how conventional understandings of the economy or growth may be too narrow to capture the complexity of what goes into creating more equitable economies.
An Alternative: Looking in, Leveraging, and Locking
In this section, I present the 3L framework that is a synthesis of the above-mentioned theories in equal measure, and consists of three sequential steps: looking in, leveraging, and locking, represented in Figure 4.
Visual Representation of the 3Ls.
Looking in describes a process whereby local leaders (broadly defined) first assess what assets exist within their neighborhoods, cities, and regions. For example, practitioners may identify untapped opportunities for entrepreneurship and business expansion in historically marginalized communities. As local leaders identify assets, they will also likely identify community needs and resource gaps, a logical corollary to this process. Based on the aforementioned frameworks, “assets” broadly refers to the various natural, cultural, human, social, political, economic, and built resources in a place. Looking in assumes that all locales have assets but that existing resources are not always formally recognized or accounted for by all local leaders.
It is important to acknowledge that this first step comprises several components. For instance, stakeholders will need to develop an inclusive, representative, and collaborative process to develop a set of shared priorities (Center for Community Investment, n.d.), a difficult process as local leaders may need to work through power differentials within communities. Stakeholders must also collectively agree upon which tools will help them identify community assets and how to capture this information. More generally, this model assumes that local leaders—assets in their own right—already exist in places to effect change. For the purposes of this commentary, I broadly define leaders as individuals who interact with and influence the behaviors of others to achieve common goals, recognizing that there are a myriad of ways in which scholars have conceptualized this term and this field of research. However, this commentary stops short of identifying how leaders effectively promote change as there are many ideas, but few definitive answers on this issue (Glynn & Dejordy, 2010).
Leveraging enables local leaders to activate stakeholder relationships to take better advantage of existing assets identified in the first step. Social networks and social capital drive these processes. Through partnership and collaboration, stakeholders may spark a spiraling-up effect that helps them to secure additional assets, enabling locales to overcome existing resource and capacity limitations. Collaboration may happen among different entities and sectors, as well as at different scales of governance: individuals, organizations, and institutions; various government agencies, business sectors, and nonprofits; across neighborhoods, communities, and regions.
Leveraging is context-dependent; however, the processes by which locales leverage existing assets will be different in different places. For example, one locale may have a robust infrastructure of anchor institutions, nonprofits, and philanthropies but these entities may be working in silos or competing with one another. Consequently, organizations would need to identify ways to avoid duplication, share information, and develop referral mechanisms to better coordinate activities. In such cases, stakeholders may opt to create a lead organization that convenes and coordinates the work of multiple organizations, ideally improving the chances for attracting additional resources.
The need for trust-building in this step is assumed as all locales struggle with politics inherent to economic development practice. For example, local leaders may not have collaborative relationships with state leaders, or nonprofits may have a history of competing with one another for resources. Residents may not always trust local elected officials, especially in places where government agencies have historically instituted policies that directly impact certain communities without their input. In other cases, histories of racial oppression present barriers to building trust and collective action. While not the focus of this commentary, strategies such as the Truth, Racial Healing & Transformation (TRHT) process have enabled organizations and individuals to engage in transformative conversations related to race and racial justice that promote community change.
While leveraging is key to achieving local stakeholders' shared priorities, particularly in areas with capacity and resource constraints, the resulting activities may not necessarily result in the well-being of existing residents, particularly those who are economically vulnerable. For example, local leaders may commit to rebuilding and rebranding their downtowns by supporting small businesses, improving green infrastructure, and developing more housing. Their decision may have been based upon an assessment of existing assets and efforts to leverage available resources, but local leaders may not have accounted for measures to help existing low-income renters stay in place if property values rise. For example, evidence suggests that certain green infrastructure investments (broadly defined) in historically underinvested areas may be linked to the displacement of low-income residents (Connolly et al., 2023). The concept of locking addresses such concerns.
The third step, locking, entails instituting policies and practices that better ensure that existing residents—particularly those most marginalized and economically vulnerable—directly benefit from economic development initiatives. Ideally, such activities promote virtuous cycles of economic activity and wealth generation for residents. Locking can happen in multiple ways, depending on the kinds of assets stakeholders hope to leverage, existing capacities, as well as appetite for change. Locking activities may also occur along a spectrum, and there may be multiple and complementary forms of locking within locales.
More conventional activities may include linking the use of government funds and incentives to benefit local workers and residents. For example, local leaders may not only tailor workforce development programs to incentivize corporations to hire locally but also push for guaranteed placement for trained or accredited residents. Stakeholders may also push beneficiaries to support local small businesses through procurement requirements.
In other cases, locales may revamp existing activities to address the needs of previously overlooked populations. For instance, economic development agencies could reallocate resources and adapt existing services to better serve immigrant, nontech entrepreneurs. By institutionalizing such programming, practitioners would help such entrepreneurs formalize and/or scale their businesses, strengthen local immigrant entrepreneurial ecosystems, and help new Americans build wealth.
Finally, local leaders may blur the lines between community development and economic development. Practitioners may choose to collaborate with nonprofit housing developers so that new affordable housing units are built in tandem with other major commercial or manufacturing developments, while also working to preserve the existing affordable housing stock in a locale. In such cases, locking could entail changes to land use policies (e.g., zoning), implementing financing mechanisms that support such actions, or other measures. Other practitioners may focus on building partnerships with childcare providers and school districts to ensure quality childcare and/or PreK-12 education—necessary opportunity structures for socioeconomic mobility, and of benefit to both workers and employers.
Ultimately, such efforts can lock benefits within locales, strengthening social networks, civic institutions, and the local tax base. Below, I offer examples of the 3Ls in action.
Example 1: Invest Appalachia
Central Appalachia, comprising counties in Kentucky, North Carolina, Ohio, Tennessee, Virginia, and West Virginia, is known for its natural resources, culture, and community resilience. However, it has also been chronically underresourced and disproportionately impacted by extractive industries that have left many residents in poverty and poor health. Due to a variety of factors, Central Appalachia has historically received relatively few or sporadic capital investments from major foundations, federal sources, or other entities. Though there are several established place-based organizations in the region, these organizations have often worked in silos, adding to difficulties in scaling investments.
Looking In
The Appalachia Funders Network, a member-based organization that connects funders interested in advancing equitable growth in Central Appalachia, began looking in by convening members and affiliates (e.g., lenders, social entrepreneurs, community development professionals, and foundations) in 2016. At these convenings, members discussed how to leverage existing philanthropic, private, and public funds so that more capital investments could flow into the region. They mapped out the region's assets, shared innovative practices, identified common challenges and capital access gaps, and developed shared priorities that revolved around formalizing and coordinating regional investments.
Leveraging
Invest Appalachia (IA) was founded in 2019 as a regional investment fund that combines various forms of capital from investors (e.g., corporate philanthropy, foundations, and federal funding) to complement existing capital investment activities in the area. IA is an intermediary that leverages the financial capacities of existing regional partners with flexible and “patient” capital and other credit enhancements (e.g., loan guarantees) that can apply to single investments or a cluster of deals relating to clean energy, community health, creative place making, and food and agriculture. In these ways, the organization enhances the creditworthiness of a deal or absorbs perceived risk for low-wealth borrowers and mission-driven lenders.
Locking
By developing funding strategies designed for the region, IA locked in its first round of funds totaling $900,000 for nine projects in Central Appalachia in 2022. In this round, IA prioritized projects in Eastern Kentucky that were impacted by flooding, and funded projects focusing on affordable housing development, small business support, and consumer credit. In 2023, its first full year of operations, IA committed over $7 million in investments, which has helped leverage more than $35 million in total investments to the area (Invest Appalachia, 2023). In the future, funds repaid by borrowers, as well as additional investments, will be redeployed to support more projects in the region.
Example 2: Made in Durham
Durham, North Carolina, is a rapidly growing city and part of the Durham–Raleigh–Chapel Hill Research Triangle, home to many knowledge-based companies as well as to major educational institutions such as Duke University, North Carolina State University, and the University of North Carolina at Chapel Hill. The city is changing significantly, and residents continue to raise concerns about gentrification and the shrinking supply of affordable housing, at least in part due to the continued inflow of tech-based companies. This dynamic exacerbates existing disparities between low-income residents of color and wealthier newcomers (De Marco & Hunt, 2018). From 2010 to 2020, the population in Durham has grown from 230,000 to 285,000 based on U.S. Census Bureau figures.
Looking In
Starting in 2011, various community stakeholders (e.g., community and economic development practitioners, business community, and academics) convened to improve the city's education-to-career system. This goal aligned with city and county efforts to develop a strong and diverse pool of local talent to accommodate the growing number of tech and biotech companies in the region and to encourage incoming firms to hire locally. Broader trends of robust collaboration between community colleges and industry professionals in sectors such as biotech (Haskins & Parilla, 2024) acted as the backdrop to these efforts in North Carolina.
Through various convenings and research initiatives, Made in Durham was created in 2014 to nurture the professional development of young people—arguably one of the city's greatest assets —by better connecting 14- to 24-year-olds who are disconnected from educational institutions and employment opportunities, particularly in local high-growth industries. The organization mobilizes and convenes an expansive network of stakeholders, avoiding duplication, and taking a systems-level view to identify and address strengths, weaknesses, and gaps in this ecosystem, while also testing models to boost innovative practices.
Leveraging
Made in Durham leverages relationships and resources from the region's existing infrastructure of youth-serving community-based nonprofits, Durham Technical Community College, the Greater Durham Chamber of Commerce, local industries, and government agencies to facilitate recruitment, training, and placement. Specifically, the organization's BULLS Life Sciences Academy works closely with Durham Technical Community College, which expanded its biosciences training programs through a 2022 bond referendum and additional funding from Novo Nordisk, a pharmaceutical company. Durham Technical Community College continues to provide training options while Made in Durham relies on existing community-based nonprofits to help recruit local participants. The organization then fills support gaps by securing government and philanthropic funds for student stipends and coaches who offer participants one-on-one support. The organization continues to strengthen its connections to businesses to support its participants.
Locking
As of 2024, the BULLS program embarked on its 10th cohort. Eighty-eight percent (or 69 students) completed the program in 2024, successfully earning a certificate that helps them secure an entry-level position as a technician, which typically pays from $20 to $25 per hour. That year, 17 participants found jobs in life sciences (Made in Durham, n.d.) as graduates are guaranteed interviews but not direct job placements. The organization continues to push for direct placement, locking more opportunities for youth participants. Ultimately, this program engages youth from historically marginalized communities to develop new skills in a supportive environment, facilitates their chances of establishing a career in a growing industry, and strengthens their economic foothold in a changing city. The program bolsters the local workforce development ecosystem and, over time, can increasingly contribute to addressing the growing labor needs of the biosciences industry in the region.
While both examples predate this framework, they illustrate how practitioners may utilize the 3L model to incorporate key features of the community capitals, ABCD, community economies, and scaling-deep frameworks into their respective economic development initiatives.
Why the 3L Framework and Not Others?
To be clear, the 3Ls represents one of many frameworks for economic development practice. For comparison I review several as follows:
Similar Assumptions, but a Different Formula: The Creative Class as New Drivers of Economic Growth
Richard Florida's well-known 3T framework (2019) focuses on the creative class, or individuals “whose economic function is to create new ideas, new technology, and new creative content” (p. 8). The 3Ts—Technology, Talent, and Tolerance—must work in tandem to increase innovation, productivity, and economic growth, and creative people ultimately drive these processes. This means that decision makers need to pivot from older models of economic development (e.g., relying on large infrastructure projects) and promote an environment that appeals to the creative class (e.g., cultural and natural amenities).
Many now criticize Florida's approach (for an overview, please refer to Peck, 2005). At best, one may say these ideas have influenced the extent to which practitioners prioritize the attraction of highly skilled workers. At worst, Florida's 3Ts do little for vulnerable populations—in some cases, this approach may deepen disadvantages. More generally, Florida's framework assumed that key goals of economic development—economic, demographic, and physical growth—do not change, but that the means to achieve these goals must change. Consequently, the previous arguments for having an alternative framework apply here.
Troubleshooting: Federal Responses to Promote Effective Economic Development
Dick Thornburgh's (1998) framework—learning, leveraging, and linking—relates to how the federal government may improve coordination and evaluation of economic development programs. Learning refers to how the federal government may engage in more evaluation and research to increase the effectiveness of economic development programs. Leveraging refers to how federal funds could be used to promote more equitable outcomes by incentivizing localities to better connect disadvantaged individuals and places to more prosperous regional economies. Linking refers to streamlining economic development activities at the federal, state, and local levels.
Similarly, Markusen and Glasmeier (2008) called for a comprehensive overhaul of federal economic development programs. Instead of a framework, the authors proposed strategies that expand on Thornburgh's analysis. The authors proposed: 1) greater links between human and physical capital investments in federal programs; 2) increased investments to spur local consumption to balance export-oriented economic activities; 3) more regulation to prevent localities from competing with one another; 4) more targeted eligibility standards to promote long-term benefits in localities; 5) consolidation of federal programs without threats of funding cuts; and 6) more research and evaluation.
The authors argued that such changes are necessary given the federal government's assumed ability to disperse federal dollars that involve multiple federal agencies, spatial scales, and stakeholders. In addition, the federal government plays an important role in filling gaps in places with fewer resources, which may be overlooked by traditional investors.
Combined, these analyses can make it easier to understand the disjointed nature of economic development policy and improvements needed in program design and evaluation. They illustrate the political nature of economic development funding and, more specifically, ways the U.S. Economic Development Administration may play a coordinating agency role. While the focus is on the federal level, these authors offered themes integral to looking in, leveraging, and locking: the need to coordinate and collaborate across agencies and geographies, the importance of leveraging government funds, a focus on equitable outcomes for historically disadvantaged groups, and a need for an inward focus to balance the tendency in economic development to do otherwise.
Given their focus, however, the authors paid less attention to the multitude of other actors involved in economic development. While federal funds are an important component, they are often part of the overall capital stack necessary to implement economic development projects. The 3Ls assumes that economic development programming and funding will remain scattered for the foreseeable future, necessitating collaboration among multiple stakeholders across organizations, communities, and geographies. Consequently, the 3Ls embodies the aforementioned reforms but also accounts for the current realities of economic development at multiple levels and geographies.
Moving Toward System Change? Collaborative Approaches for More Equitable Outcomes
More recent efforts have focused on promoting more equitable community and economic development outcomes in the United States, particularly in communities and cities with histories of underinvestment. These practice-oriented approaches are often presented as playbooks and toolkits that are, by design, atheoretical. This section highlights three frameworks but more exist.
The Brookings Institution and Local Initiatives Support Corporation (LISC) offered their approach to “community-centered economic inclusion,” comprising three factors: 1) a targeted, strategic scale, 2) a multidisciplinary systems-level scope, and 3) a level of integration (Love et al., 2021). In other words, stakeholders must identify targeted areas that are historically underinvested but have a concentration of specific assets that have the potential to spur economic activity, develop shared priorities, and coordinate public, private, and civic investments. This approach prioritizes four investment areas: economic ecosystems, the built environment, civic infrastructure, and the social environment. Active collaboration between community members and regional and local decision makers is integral to this approach, as is the presence of a coordinating, trusted organization. LISC, a national community development finance institution, has, in practice, acted as a coordinating organization, leveraging its networks and resources in demonstration cities such as Los Angeles, California.
The second framework, the Center for Community Investment's (CCI) capital absorption approach, consists of 1) articulating shared priorities, 2) creating and executing an investible pipeline of deals, and 3) improving the enabling environment. CCI defines a shared priority as “the North Star that guides collaborative work on community investment” (Center for Community Investment, n.d.). It comprises an aspiration developed by local actors and institutions, as well as the strategies by which change will occur. Stakeholders then create a pipeline of deals to batch related projects to effectively utilize and secure resources. Finally, stakeholders attempt to improve aspects of the enabling environment, or the local conditions that facilitate or deter stakeholders’ abilities to achieve their goals. This may consist of altering institutional practices and strengthening local community-based organizations. Ideally, this framework empowers communities, particularly those that have experienced underinvestment, as it encourages local stakeholders to take more control over how, when, and what kinds of investments are made.
The third framework, the Aspen Institute's Community Strategies Group, offers WealthWorks, a comprehensive asset-based framework that aims to build “a more inclusive economy in which economically marginalized people and places build wealth through market engagement” (WealthWorks, n.d.). WealthWorks's four-step module entails 1) exploring regional wealth building, 2) identifying a market opportunity, 3) constructing a value chain, and 4) gauging wealth and impact. It encourages regional leaders to take a demand-driven approach with the goal of bolstering existing community capitals, creating new economic activities in a region, and encouraging “wealth that sticks” (WealthWorks, n.d.).
All three approaches necessitate collaboration among local and regional actors and the development of common goals. Whether explicitly stated, they also require a lead organization to facilitate collaboration, and they aim to strengthen and/or instigate economic activity that benefits communities with histories of underinvestment. Closing racial wealth gaps and creating thriving neighborhoods for and by residents are—depending on the approach—explicit or implicit goals. In addition, taking an asset-based approach is essential.
Clearly, these approaches align closely with the 3Ls but there are distinctions. For instance, Brookings Institution's and LISC's model for community-centered economic inclusion may not be for all communities, such as those with “steep and overlapping market obstacles and few opportunities to alleviate poverty” (Love et al., 2021, p. 16). In other words, this framework offers valuable strategies for places that already have a mix of certain assets as commercial corridors, industrial land, transit access, and an influential coordinating organization.
On the other hand, CCI's model could arguably be applied to all communities; in fact, CCI has collaborated with organizations such as Invest Appalachia. In certain cases, however, stakeholders using this model may not feel compelled to engage in activities that relate to locking. For example, community stakeholders may agree to bolster small business capacities and create commercial corridors in historically underinvested communities, yet their strategies may not ensure that entrepreneurs and residents in formerly weak markets can stay in place if real estate values increase. The 3Ls explicitly incorporates this last step into a normative framework.
Although there is strong alignment between the 3Ls and the Aspen Institute's WealthWorks framework, one may argue that the latter offers a very specific approach to community wealth building that is dependent on external market demand. Practitioners may certainly use the 3Ls to do the same, but it may also allow for more flexibility in helping stakeholders assess what kinds of economic activities could count as economic development.
Ultimately, the approaches offered by the Brookings Institution and LISC, CCI, and the Aspen Institute demonstrate how economic development can better benefit more individuals and groups, and it is up to practitioners to decide which model best suits their needs. The 3L framework distinguishes itself by encouraging stakeholders to consider the central purpose of economic development for their communities through a normative framework that accounts for different contexts while offering a three-step, action-oriented pathway to achieve more equitable economic outcomes.
Conclusion
As social, economic, and spatial inequalities continue to grow in the United States, the active incorporation of asset-based frameworks such as the 3Ls may help local leaders reconceptualize the goals of economic development and the means to achieve them. The 3Ls—looking in, leveraging, and locking—is a framework that derives from alternative theories beyond the purview of traditional economic development thinking. Conventional economic development practices may be too limited to capture the full range of activities and approaches that may promote community well-being, particularly in places with histories of economic and social marginalization. The 3Ls aim to advance conceptualizations of economic development that recognize the full potential of people and places, favor collaboration, and prioritize mechanisms that foster stable communities, setting the conditions for more equitable and long-term growth in cities and regions.
Footnotes
Funding
This research was supported by a grant from the Robert Wood Johnson Foundation.
Declaration of Conflicting Interests
The author declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.