Local economy

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The term local economy means the entirety of all (economic) activities that relate to the development of a place. It stands in the context of the alternative economies, which emerged in the 1970s as a form of social and economic criticism and turned against the alienation of society and the exploitation of the environment through materialistic , utilitarian and hedonistic motives.

The economic unit that forms a place is made up of the population group or the community of a place (social dimension), a natural environment (ecological dimension) and a specific tradition and history (cultural dimension). When considering the economic entity, the informal economy is also taken into account in the spatial reference in addition to the formal economy .

Concept history

The meaning of the term local economy is not completely defined uniformly and the ascribers have changed over the course of history. While the term (i) was still used at the turn of the 19th and 20th centuries as a counter-term to national economy to describe economic activities in a (subnational) location, it (ii) changed into a strategic one in the 1970s / 80s Term that summarizes measures to promote economic crisis regions. A third understanding of local economies (iii) results from the previous funding practice, in which the local orientation of organizations is primarily considered.

The term local economy has been taken up by many projects related to the area for several years.

definition

The term local economy can literally be translated as local household (cf. Latin locus ≙ local, place, place, place; Greek oikonomia ≙ housekeeping, administration).

The local is a historically evolved structure, a place in a geographically delimitable, manageable space with specific characteristics (people, nature, culture), whose wealth results from different combinations and synergies and whose development results from the interaction of the most varied of forces.

A distinction can be made between real places , which are composed as described above and whose borders are fluid, and political places , which represent administrative units.

Local economy therefore does not all focus on the field of economic policy, but also integrates social philosophy and social policy .

Goals and Concepts

As social and economic criticism

Local economy as a form of social and economic criticism is directed against the alienation of society and the exploitation of the environment through materialistic, utilitarian and hedonistic motives. The merging of production and consumption in one place as an element is increasingly taking place as a form of cultural identification. The aim is to create a community that enables economic and social security through familiarity, manageability and the ability to control, in order to counteract global processes such as anonymity, individualization, homogenization and environmental degradation.

Local economy at the geographical location

The first local economic concepts and measures developed in the course of the 1980s in economically dependent regions from local and regional political initiatives with the aim of combating unemployment, economic decline and the associated social consequences. Initiatives of the regions excluded from the supraregional economic activity requested through practical attempts of local economic self-help projects a restructuring of the economic and social relations on site and in the region in order to rebuild them. Three goals can be named above all:

  1. Job creation in the local area
  2. Generation and circulation of income in the local area, according to the multiplier effect of the export base theory
  3. Preservation or restoration of infrastructures and natural areas of the local

To ensure a long-term functioning local economy, the concepts are sustainably oriented, for which historical economic organizations and traditional cultural techniques are partly taken up again and adapted to today's needs and possibilities.

Local economies aim to achieve greater independence from global economic processes. A local community is often spoken of here, whose focus is on meeting needs, securing livelihoods and social integration. A roof over one's head, land, a livelihood job, adequate infrastructure, health services, clean water, etc. are considered to be fundamental for this.

In the conceptual promotion of local economies, the methodological approaches of the

  • systematic connection of concrete needs and potentials in the community
  • Initiation of processes of personal and structural empowerment and the promotion of social and economic self-organization
  • Promotion of cooperative entrepreneurships
  • Support for cooperative business start-ups in the areas of production, supply, service, education, health and social issues
  • Act as an intermediary body
  • Design of local cooperation networks and circular economies with a joint cooperative infrastructure
  • Creation of local multi-stakeholder structures, especially for cooperative solutions for services of general interest

tracked.

Local economy of an organization

In contrast to these concepts, which focus on one geographic location, individual organizations from the private sector and civil society can also be examined on the basis of their spatial reference and local economic aspects.

The local orientation can be derived from (1) the share of local employees, (2) local value chains and (3) the share of locally based customers.

A distinction is made between three types of local economic organizations:

Type A: Organizations with a spatial reference through a direct supply function for the local population. This type of organization includes, for example, small retailers and craft companies, ethical companies, associations and initiatives that shape the location profile of a district.

Type B: Organizations with a spatial reference through commitment to site development. These organizations don't just focus their offerings on the local market. Their settlement in the place has various causes; such as existing real estate. Examples are craft companies and associations that also operate nationwide. Since companies in particular are influenced in their development by the quality of the location on site, they often strive for a sustainable improvement in the local conditions (e.g. through privately initiated street cleaning, street furniture, etc.).

Type C: Organizations with no direct spatial reference. These are not anchored locally, but can have a positive effect on it, for example through the use of commercial real estate or the creation of buyer frequencies through commuters (employees, customers). For example, service centers of national companies.

Fields of action, instruments and measures

Overriding labor market and employment policy and structural and social policy are seen as areas of action for local economic transformations. Measures of economic development, regulation and location development serve as instruments.

The field of action of structural and social policy counteracts the negative effects of spatial concentration of poverty and unemployment and the erosion of social responsibility. Places shaped in this way largely lose their self-determination and their own design areas. Structural facilities such as educational, training and counseling facilities, family facilities close to home (day nurseries, day-care centers), locally oriented value chains and local basic services should create self-determined and resilient networks.

The labor market and employment policy attempts to exclude individuals from the work process, however, observes an increasing importance of informal economies in areas with high unemployment. In addition, persistent unemployment has psychosocial and health-impairing consequences and contributes to low esteem and stigmatization in the population. In some places, qualifications of the residents remain unused and specializations as well as monotonization of the work processes take place if these do not even migrate and the situation worsens.

Justification for the importance of local economy

The programs of the EU and the OECD contain implicit and explicit justifications for the importance of local economies, which would be:

  1. Alternative economies, promotion of integrative local cooperations to establish local networks that compensate and correct errors in the market through social integration and participation
  2. Alternative economies, networks as the economic backbone in local and regional areas, whose actors jointly pursue social and economic goals in the long term and thus form a supporting community
  3. Alternative economies, These networks also offer marginalized groups and individuals a chance of economic participation
  4. Alternative economies, organization of multi-stakeholder companies and networking of companies and organizations at local level in order to guarantee the highest degree of stability and needs-based resilience
  5. Alternative economies, development of local potentials and the specific organization of socially necessary work of relevant local actors from different areas of society in a locally-specific approach.

Individual evidence

  1. ↑ alternative economics - encyclopedia - Brockhaus.de. Retrieved July 7, 2020 .
  2. ↑ Guido Nischwitz, Reimar Molitor: From the world market to the weekly market . In: Ökologisches Wirtschaften - trade journal . tape 15 , no. 3-4 , July 1, 2000, ISSN  1430-8800 , doi : 10.14512 / oew.v15i3-4.35 .
  3. ↑ Sebastian Henn, Michael Behling: Local economy - term, characteristics and conceptual delimitation . In: Local Economy - Concepts, Neighborhood Contexts and Interventions . Springer Berlin Heidelberg, Berlin, Heidelberg 2020, ISBN 978-3-662-57779-0 , pp. 3-24 , doi : 10.1007 / 978-3-662-57780-6_1 .
  4. ^ Simone Helmle: Local economy . In: Concise dictionary on rural society in Germany . VS Verlag für Sozialwissenschaften, Wiesbaden 2005, ISBN 978-3-8100-3749-7 , p. 153–159 , doi : 10.1007 / 978-3-322-80909-4_19 .
  5. ↑ Guido Nischwitz, Reimar Molitor: From the world market to the weekly market . In: Ökologisches Wirtschaften - trade journal . tape 15 , no. 3-4 , July 1, 2000, ISSN  1430-8800 , doi : 10.14512 / oew.v15i3-4.35 .
  6. ↑ alternative economics - encyclopedia - Brockhaus.de. Retrieved July 7, 2020 .
  7. ^ Simone Helmle: Local economy . In: Concise dictionary on rural society in Germany . VS Verlag für Sozialwissenschaften, Wiesbaden 2005, ISBN 978-3-8100-3749-7 , p. 153–159 , doi : 10.1007 / 978-3-322-80909-4_19 .
  8. ↑ Guido Nischwitz, Reimar Molitor: From the world market to the weekly market . In: Ökologisches Wirtschaften - trade journal . tape 15 , no. 3-4 , July 1, 2000, ISSN  1430-8800 , doi : 10.14512 / oew.v15i3-4.35 .
  9. ↑ Walter Hanesch, Kirsten Kruger Conrad: Local employment and economy as a challenge to the 'Social City' . In: Local Employment and Economy . VS Verlag für Sozialwissenschaften, Wiesbaden 2004, ISBN 978-3-531-14289-0 , p. 7-33 , doi : 10.1007 / 978-3-322-80586-7_1 .
  10. ↑ Walter Hanesch, Kirsten Kruger Conrad: Local employment and economy as a challenge to the 'Social City' . In: Local Employment and Economy . VS Verlag für Sozialwissenschaften, Wiesbaden 2004, ISBN 978-3-531-14289-0 , p. 7-33 , doi : 10.1007 / 978-3-322-80586-7_1 .
  11. ↑ Sebastian Henn, Michael Behling: Local economy - term, characteristics and conceptual delimitation . In: Local Economy - Concepts, Neighborhood Contexts and Interventions . Springer Berlin Heidelberg, Berlin, Heidelberg 2020, ISBN 978-3-662-57779-0 , pp. 3-24 , doi : 10.1007 / 978-3-662-57780-6_1 .
  12. ↑ Sebastian Henn, Michael Behling: Local economy - term, characteristics and conceptual delimitation . In: Local Economy - Concepts, Neighborhood Contexts and Interventions . Springer Berlin Heidelberg, Berlin, Heidelberg 2020, ISBN 978-3-662-57779-0 , pp. 3-24 , doi : 10.1007 / 978-3-662-57780-6_1 .
  13. ^ Simone Helmle: Local economy . In: Concise dictionary on rural society in Germany . VS Verlag für Sozialwissenschaften, Wiesbaden 2005, ISBN 978-3-8100-3749-7 , p. 153–159 , doi : 10.1007 / 978-3-322-80909-4_19 .
  14. ↑ Walter Hanesch, Kirsten Kruger Conrad: Local employment and economy as a challenge to the 'Social City' . In: Local Employment and Economy . VS Verlag für Sozialwissenschaften, Wiesbaden 2004, ISBN 978-3-531-14289-0 , p. 7-33 , doi : 10.1007 / 978-3-322-80586-7_1 .