Competitive Regions Critical to a Stronger U.S. Economy (6/12/2008)

With high gas prices and slumping home prices clouding the outlook for the U.S. economy, national leaders including Mark Drabenstott, director of the University of Missouri's Center for Regional Competitiveness, gathered recently in Chicago to find ways to help the nation's workers and businesses build a stronger economic future. Drabenstott explained that focusing on regions, instead of the entire country, is critical to improving the U.S. economy overall. Counties and communities must think regionally to compete globally, he said.

According to Drabenstott, a research professor in the MU Truman School of Public Affairs, regions are defined as the natural economic geographies that are bound together by workforce, transportation, health care, higher education, business clusters, and unique cultural and landscape features. In the United States, most regions include several counties and may spill across state lines.

"Globalization has made regions the 'athletes' in the global economic Olympics," Drabenstott said. "Simply put, regions are where the real action is in terms of how economies adjust to the increasing tempo of global markets. Regions have become the framework for economic development for three reasons: size, competitive edge and innovation."

Sufficient size, or critical mass, is necessary to compete against other major economies. For example, Chicago's competition is not Indianapolis or Milwaukee; it's London, Madrid, Paris and Tokyo. Drabenstott said that finding a competitive edge through a few key economic niches is essential to success because many cities and counties throughout America still pursue a 20th century development strategy of business recruitment. The field of competition in global markets also is shifting in favor of innovation. Drabenstott said that every U.S. region must create better things to do rather than just doing old things better.

"Regional thinking and action will secure America's position as the leading global economy. At its very heart, the concept of economic competitiveness holds a powerful core American value: winning. There was strong bipartisan agreement at the summit that the question is not whether to compete but how to compete," he said.

Experts at the summit, including Treasury Secretary Henry Paulson and Chicago Mayor Richard Daley, discussed trade, foreign investment, innovation, higher education and business strategies for improving different economic regions. For example, South Carolina Gov. Mark Sanford noted that several South Carolina regions had been very successful by convincing foreign firms to expand there. Drabenstott said the consensus was that regions must assemble five essential building blocks to compete well: strategy, partnership, innovation, entrepreneurship and synergies.

"No region is an island unto itself," Drabenstott said. "Every region must utilize neighboring regions to leverage its competitive advantage. Rural-urban linkages are a great example. Chicago will compete with Paris and London, but its ties to the agricultural powerhouse just beyond its metropolis can make the Windy City's economy even stronger. For instance, Chicago has powerful research institutions that may discover medical therapeutics that could be grown in Illinois fields. London will never be able to do that."

The MU Center for Regional Competitiveness is a part of the Rural Policy Research Institute.

Note: This story has been adapted from a news release issued by Missouri University

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