THE DEVELOPMENT AND APPLICATION OF A REGIONAL AND LOCAL ECONOMIC DEVELOPMENT ASSESSMENT INSTRUMENT

Abstract

Globally, local economic development (LED) is recognised as a strategic process that assists with the acceleration of economic development in local regions, in both developed and in developing countries. Economic development practitioners have a need for user-friendly assessment instruments and tools to analyse and compare economic development in regions. The aim of the study was therefore to develop and apply an instrument to assess the economic development potential of a region since such a comprehensive strategic and practical instrument does not exist. Various types of regions, from national to local, could be assessed and compared using the instrument. The development potential (DP) of a region has been formulated as the aggregate of all local resources (R) multiplied by the aggregate of local capacity (C); therefore DP = R x C. Extensive research has lead to the identification of variables contributing to the extent of the local resources and capacity. The methodology included the identification of variables representing capacity and resources and the allocation of values for each variable through a quantitative survey method which included 380 local business people. The instrument was tested in a developing region in South Africa known as the “Vaal-Triangle” region, which includes the municipal areas of Emfuleni, Metsimaholo and Midvaal. In testing and applying the instrument in the study region, it was found that all three areas had low economic development indexes of below 30 (where the maximum is 100). The instrument identified the variables responsible for this relatively low index and those factors need to be addressed in a LED strategy. In addition, the instrument could assist development practitioners to assess the economic development potential for a region and to formulate strategies to improve the potential.

Keywords

• Assessment instrument, development potential, local economic development (LED), regional development, Vaal-Triangle region