Texas Extension has long believed community development precedes economic development. It is much easier to support economic growth and economic development if you have a community people want to live in.
Rural hospital closures shine a light on the interplay of community and economic development. Frank local news stories about the reasons for and outcomes of hospital closures highlight the importance of community social and physical infrastructure in supporting local economies. My own research shows that the presence or lack of physicians is associated with a number of social and infrastructure issues within a community, including the presence of other highly educated professionals and broadband access.[1] The presence of a local hospital is associated with a number of economic outcomes, as well as with healthcare access and quality of life in rural communities.[2] Hospital closure is often considered a barrier in attracting new businesses to a community. The primary function of a hospital is not economic, but numerous studies, including my own, demonstrate the economic impacts of hospitals and healthcare systems on local economies.[3],[4]
Similarly, passenger transit, particularly paratransit and transit for older populations, is not aimed at economic development. However, the ability to keep people active in their community and helping them to age in place can be important to maintaining housing stock and a vibrant retail and service economy in addition to maintaining personal independence and the social communities of people depending upon transit.[5]
In Texas, 4A sales taxes allow economic development use only while 4B taxes foster community economic development more broadly.[6] The 4B tax allows investments in community projects like park improvements, recognizing that community development precedes economic development. People want to live and work in nice places and with nice people—that is with people and places with whom they identify in a positive way.
Extension economic development programs often spend a significant portion of time on “non-economic” aspects of community engagement that foster leadership, networking, and appreciation of local assets, including culture and natural amenities. These aspects of development lay the foundation for community and economic development. Both the national Stronger Economies Together program and the Leaders in Economic Development Alliance Development program coordinated by the Southern Rural Development Center have modules addressing the creation of diverse, representative leadership teams and the inventorying regional assets to support development. Team building and asset identification occur before economic development planning. Community development precedes economic development.
It’s worth noting that not all community development efforts lead to economic development. Perhaps a local festival will become an economic engine. Perhaps it will remain an event primarily building community among locals and people who would have visited anyway but time their visit to coincide with the event (time-switchers)—often people with strong ties to the community. That’s OK. People and relationships are valuable.
Similarly, not all communities are functional economies. Many communities are centered around residential neighborhoods. Many rural unincorporated areas (e.g., in Texas ) or “townships” (e.g., in Kansas) have few businesses or business networks, although they may have a church or community clubs. That’s OK too. Economic opportunities may be desirable and develop, but ultimately a community does not need to be an economy or political jurisdiction to be a meaningful place or worthwhile social group. Economic development need not always proceed from community development.
Improving the social networks, infrastructure, and other quality of life factors for residents often pays off in the form of retaining existing residents and attracting new residents and businesses. Even when economic development does not result, people are likely better off having invested in each other and in their community. On the other hand, it’s hard to imagine successful, sustainable economic development that doesn’t have a foundation in building local human, social, political, built, and other forms of capital.
[1] Dudensing, Rebekka. 2017. Research Notes: Rural Regions, #2: The Regional Distribution of Doctors. Department of Agricultural Economics, The Texas A&M University System, College Station, Texas, September. https://agecoext.tamu.edu/wp-content/uploads/2013/08/Rural-Regions-2-Regional-Distribution-of-Doctors.pdf
[2] Hart, L. Gary., Michael J. Pirani, and Roger Rosenblatt. 1991. Causes and Consequences of Rural Small Hospital Closures from the Perspectives of Mayors. The Journal of Rural Health 7(3): 222-244.
[3] Doekson, Gerald A., Tom Johnson, Diane Biard-Holmes, and Val Schott. 1998. A Healthy Health Sector is Crucial for community Economic Development. The Journal of Rural Health 14(1): 66-72.
[4] Dudensing, Rebekka. 2020. Economic Impact of Cogdell Memorial Hospital: 2019. Department of Agricultural Economics, The Texas A&M University System, College Station, Texas, April.
[5] Fasanando, Sarah F., James W. Mjelde, and Rebekka Dudensing. 2020. Rural Transit Needs for Older Adults, EAG-061, Texas A&M AgriLife Extension Service, The Texas A&M University System, College Station, Texas, September. https://agecoext.tamu.edu/wp-content/uploads/2020/09/EAG-061-Transit-Needs.pdf
3 Responses to Community Development Precedes Economic Development