Community Economic Development Key Concepts

Abstract

Community economic development (CED) is a crucial process for any community regardless of its size or location. With globalization continuing to impact communities and the digital age in full swing, understanding what affects CED is critical. Community economic development, when implemented correctly, has the potential to help communities not only remain competitive but, more importantly, adapt to a very complex and dynamic situation. This publication provides key concepts and definitions related to the CED process.

Full text

Community Economic Development:
Key Concepts
Community economic development
(CED) is a crucial process for any com-
munity, regardless of size or location. With
globalization continuing to impact com-
munities and the digital age in full swing,
understanding what affects CED is critical.
Community economic development, when
implemented correctly, has the potential to
help communities not only remain compet-
itive but, more importantly, adapt to a very
complex and dynamic situation.
This publication, the rst in a com-
munity economic development series,
provides key concepts and denitions
related to the CED process. These describe
what this process includes, what affects it,
and how it can be unleashed in communi-
ties. In practice, community and economic
development go hand-in-hand and dis-
tinguishing them is somewhat difcult; in
theory, however, it is easier and appropri-
ate to do so.
Key Concepts & Denitions
The concepts covered here are not
intended to be comprehensive, but they
should provide a broad understanding of
the CED process. Before we discuss these
concepts, it is important to understand a
key difference between growth and develop-
ment. Many people equate these two terms,
which can have negative consequences for
the CED process. Growth is a quantitative
increase, while development is a change
aimed at a particular goal (Robinson &
Green, 2010). In other words, growth is
more about quantity, while development
is more about quality. As a community
leader, do you want your community
to grow or do you want it to develop?
Answering this question is critical before
attempting to implement a CED process in
your community.
Let’s begin with a basic question:
What is a community? The denition of
community is usually taken for granted
but not truly understood. As an example,
ask several of your colleagues how they
would dene community, and you will
see that their denitions vary widely. So
what is a community? A community is a
geographically dened place where people
interact (Robinson & Green, 2010). But a
community is not only the physical space
where people interact; it also provides
important activities and functions that serve
its residents. These community functions
range from economic (provides goods
and services) to socialization (the process
through which the community transmits its
knowledge, values, and behavior patterns
to its residents) to social control (the pro-
cess through which a group inuences the
behavior of its members to conform to its
norms) to social participation (provides a
venue through which residents can partici-
pate in their communities) to mutual sup-
port (provides help and support in times of
need) (Warren, 1987).
These functions are not carried out in a
vacuum; they rely on institutions—dened
as rules, including informal norms, and or-
ganizations that coordinate human behav-

ior (Anglin, 2011). Institutions in a community vary
and include family, economic, education, political/
government, faith-based/religious, and associations.
For example, some communities may have stronger
political institutions and weaker education-related
institutions. This institutional diversity affects hori-
zontal and vertical linkages in the community. Hori-
zontal links refer to connections between local institu-
tions (such as a local nonprot with the local school),
while vertical links refer to connections between local
institutions and external (state, regional, or federal)
resources (such as the local economic development
organization with a statewide or regional economic
development agency). The catch here is that focusing
only on vertical links can compromise community
autonomy—relying almost solely on external orga-
nizations to move the community forward. A more
balanced approach uses horizontal links to identify
community priorities and issues and then vertical
links to secure external resources and expertise.
In summary, linkages are the capacity of communi-
ties to carry out functions that depend on the nature
and strength of institutions (Robinson & Green, 2010).
The question now becomes: What is community devel-
opment? Though multiple denitions exist, this is a
good community development denition:
a group of people in a locality initiating a social action pro-
cess—i.e., planned intervention—to change their economic,
social, cultural, and/or environmental situation (Christenson &
Robinson, 1989)
If you have a hard time remembering such a long
denition, remember these key words: people, locality,
planned, change, and situation. Community develop-
ment is all about people planning to change a specic situa-
tion in their communities.
To effectively identify solutions and deploy
resources and programs, multiple players, including
but not limited to local residents, private foundations,
government ofcials, and community development
corporations, need to be involved in the process.
Community Development
versus Economic Development
Now that we have discussed key concepts and
dened community development, we need to under-
stand what economic development is. This is a good
denition of economic development:
a process that influences growth and restructuring of an
economy to enhance the economic well-being of a community
(International Economic Development Council)
Regardless of the denition used, economic de-
velopment is often associated with two objectives: (1)
creation of jobs and wealth and (2) improvement of
quality of life (International Economic Development
Council). The rst objective typically leads to the sec-
ond, but, generally, the focus is on the business aspects
of communities. So the difference between community
and economic development boils down to one ap-
proach (community development) focusing on broad-
er community issues including but broader than jobs and
businesses, while the other approach (economic devel-
opment) focuses mostly on jobs and businesses. Both
are processes taking place in a community or region.
These concepts are summarized in Table 1.
CED and Sustainability
Make no mistake: community and economic de-
velopment are intertwined. It is important to distin-
guish them theoretically, but, in reality, they depend
on one another to make a community sustainable. In
other words, CED allows residents to mobilize and build
assets to improve their quality of life in a sustainable way.
If too much effort is placed on either at the expense of
the other, the community will struggle and will not be
sustainable. In this particular context, sustainability
refers to engaging in practices that result in availabil-
ity of resources, services, and quality of life for future
generations.
CED is a complex process. Multiple moving parts
and players are involved, and it may take years to bear
fruit. However, with committed leaders and a clear
vision of where the community wants and needs to be,
CED can move communities forward in a comprehen-
sive way. Community challenges and opportunities
emerge together; it is up to the community to decide if
it will focus on the challenges or on the opportunities.
CED is a process that allows a community to focus on
both but, more importantly, to adapt to challenges and
opportunities.
The next community economic development pub-
lication will talk about general community develop-
ment approaches.

Table 1. CED key concepts and definitions.
Key concept Definition
Growth Quantitative increase in size
Development Quality change aimed at a particular goal
Community Geographically defined place where people interact
Functions Responsibilities and activities inherent in a community
Institutions Rules, including informal norms, and organizations that coordinate human behavior
Linkages Capacity of communities to carry out functions depending on strength of institutions; these can be
vertical and horizontal
Community development People in a defined location planning to change a situation
Economic development Process that influences growth to enhance well-being
Community economic
development (CED)
Process that allows residents to mobilize and build assets to improve their quality of life in a
sustainable way
References
Anglin, R. V. (2011). Promoting Sustainable Local and
Community Economic Development. CRC Press.
Christenson, J. A., & Robinson, J. W. (1989). Commu-
nity Development in Perspective. Ames: Iowa State
University Press.
International Economic Development Council. (n.d.).
Economic Development Reference Guide. Interna-
tional Economic Development Council. Retrieved
from http://www.iedconline.org/clientuploads/
Downloads/IEDC_ED_Reference_Guide.pdf
Robinson, J. W., & Green, G. P. (2010). Introduction
to Community Development: Theory, Practice, and
Service-Learning. SAGE Publications.
Warren, R. (1987). The Community in America (3rd ed.).
UPA.

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