Local Economic Development and Clusters

Local Economic Development (LED) is a strategy for promoting local economies as a way to fight poverty. LED programs often include elements of service market development and/or value chain development and vice versa. Cluster development refers to specific kind of LED strategies which focus on encouraging and supporting sectoral (and geographic) agglomerations of inter-connected companies, services and institutions. The targeted sectors are those that considered to offer the most local economic development potential. This page provides some key documents and links to information on LED and cluster promotion.

Overview and strategy documents of LED and Cluster Promotion

LED

• Wadie Hobson, Emma (2011): LED Investment Actions: A Guidance Note for Local Government.
• Book: Perry, Martin (2010): Controversies in Local Economic Development. Stories, Strategies and Solutions. Oxford: Routledge.
• UNIDO (2010): Cluster Development for Pro-Poor Growth. The UNIDO Approach.
• EGAT/UP and the Urban Institute (2008): Assessing and Starting a Local Economic Development Initiative. A Primer for USAID Field Staff. 
• Systemic Competitiveness (2008) (Mesopartner podcast)
• Business Retention and Expansion Approach to LED (2007) (Mesopartner podcast)
• GTZ (2007): Local and Regional Economic Development. Towards a common framework for GTZ's LRED interventions in South Africa.
• Local Enabling Environment (2007) (Mesopartner podcast)
• Swinburn, Gwen, Soraya Goga and Fergus Murphy (2006): Local Economic Development: A primer. Developing and Implementing Local Economic Development Strategies and Action Plans, The World Bank.
• European Stability Initiative (n.a.): Local Economic Development Tools. An Introduction for Municipalities and Local Economic Service Providers in Bosnia and Herzegovina.

Cluster Promotion

• Cluster Faciliation vs. Cluster Management (2010) (Mesopartner podcast)
• What is a Cluster? (2007) (Mesopartner podcast)
• Ketels, Christian, Göran Lindqvist and Örjan Sölvell (2006): Cluster Initiatives in Developing and Transition Economies, Center for Strategy and Competitiveness. (from: http://cluster-research.org)
• Sölvell, Örjan, Göran Lindqvist and Christian Ketels (2003): The Cluster Initiative Greenbook. (from: http://cluster-research.org)

Empirical Research, LED/ Cluster programmes and case studies

Empirical research

• Burki, Abid and Mushtaq Khan (2013): Agglomeration economies and their effects on technical efficiency of manufacturing firms: Evidence from Pakistan, International Growth Centre Working Paper.
• Ghani, Eyaz, William Kerr and Stephen D. O'Connell (2012): What makes cities more competitive? Spatial determinants of Entrepreneurship in India, World Bank Policy Research Working Paper.
  
• Ayele, Gezahegn et.al. (2010): Infrastructure and cluster development. A case study of handloom weavers in Ethiopia, IFPRI.
• Hailu, HK (2010): Success factors in Micro and Small Enterprises Cluster Development: Case of Gullele Handloom Clusters in Ethiopia.
• van Empel, Carlien (2008): Local Economic Development in Polannurawa District, Sri Lanka, ILO Subregional Office of South Asia, New Delhi.
• Nadvi, Khalid (1995): Industrial Clusters and Networks. Case Studies of SME growth and innovation. UNIDO Small and Medium Enterprise Development Programme.

LED/ Cluster Programmes and Case Studies

• SA LED Network and LEDNA (2012) Managing Informality: Local government practices
  and approaches towards the informal economy – Learning examples from five African countries
• GIZ (2012): Radio programmes for Small Businesses. Using Media for Local Economic Development in Ghana, by Kofi Owusu and Griet Newiger-Addy.
• Foundation for MSME Clusters (2006): Cluster Case Studies
• GTZ (2006): Local/Regional Economic Development in South Eastern Europe
• GTZ (2004): Alleviating poverty trough LED, Indonesia
• Mesopartner (2006): Delivering Local Economic Development in Conflict Environments. The private sector promotion project in Nepal , in: Mesopartner PACA Newsletter, April 2010.
• GTZ (2004): German-South African BDS/LED Programme Description
• OECD: Local Economic and Employment Development (LEED) Programme
• Ceglie, Giovanna (2003): Clusters and Network Development. Examples and Lesssons from UNIDO Experience. 
• UNIDO (2001): Development of Clusters and Networks of SMEs. The UNIDO Programme
• UNIDO: Cluster and Network Development Case Studies
• World Bank: Case studies of Local Economic Development
• Mesopartner: LED and cluster promotion case studies (podcasts), including
  • Experiences in Cluster Development (2010)
  • LED in post recovery disaster areas (2009)
  • Cluster Promotion at Western Cape Province, South Africa (2009)
  • LED in Bosnia and Herzegovina (2008)
  • Business Development Committtees in Nigeria (2008)
  • UNIDO's experience with cluster promotion (2008)
  • Using radio in local development (2008)
  • Training Councillors on LED (2008)
  • Experiences with LED in South Eastern Europe (2007)
  • Regional Economic Development in Central Java (2007)
  • LED in a poor rural location in South Africa (2007)

Discussions, Proceedings and Podcasts

• Participants' report, Inter-agency conference on Local Economic Development, 22-24 October 2008, Turin.
• Mesopartner podcasts on LED, Cluster Development, Value Chains and other themes

Methodologies, Tools and Training on LED and Cluster Promotion

• Reflections on PACA and Value Chains Development, in: Mesopartner PACA Newsletter, April 2010
  
• GTZ (2009): Genesis. Scenarios, Strategies and Catalytic Projects. Strategising local and regional economic development:an overview.
• The World Bank (2009): Clusters for Competitiveness. A practical guide and policy implications for developing cluster initiatives.
• Participatory Appraisal of Competitive Advantage (PACA) Method (2008) (Podcast)
• UNIDO (2006): Making Clusters work. UNIDO Methodology.
• UNIDO (2005): Methodology. Development of SME Supplier Networks.
• UNIDO (2004): Industrial Clusters and Poverty Reduction. Towards a methodology for poverty and social impact assessment of cluster development initiatives.
• The World Bank and Cities of Change Initiative (2004): Making Local Economic Development Strategies. A Trainer's Manual
• UNIDO (2003): Development of Clusters and Networks of SMEs. The UNIDO Programme. A Guide to Export Consortia.
• LED Knowledge List of Training Manuals
• Organizations offering training on LED include the ILO Turin Centre and mesopartner.

Critical perspectives on LED

Comparison of different LED approaches

• Hindson, Doug (2007): Donor Approaches to Local Economic Development in Africa, Mesopartner Working Paper.
• Helmsing, A.H.J. (2001): Local Economic Development: New Generations of Actors, Policies and Instruments, Summary Report for the UNCDF Symposium on Decentralisation and Local Governance in Africa.

Comparative perspectives on LED and other private sector development approaches

• Cunningham, Shawn and Joerg Meyer-Stamer (2005): Planning or Doing Local Economic Development? Problems with the Orthodox Approach to LED
• Mesopartner Newsletter (December 2005): Editorial: How do "Enabling Environment" and "Making Markets Work for the Poor" relate to LED and PACA?

Useful Resources

• LED Knowledge - The Global Resource Site for Local Economic Development (ILO)
• World Bank knowledge pages on Local Economic Development
• Addressing Poverty through Local Economic and Territorial Development (Natural Resources Institute)
• Local Economic Development Network of Africa
• The South African LED Network

_{Photographs courtesy of Sudipto Das, Chandan Dey, Melina Heinrich and Katalyst.}