Urban economic development : a conceptual framework

Abstract

The purpose of this study is to develop an economic policy framework for local urban authorities to empower them to increase economic growth and development and thus quality of life of its residents. The study integrates conventional economic growth theories with the urban environment and shows their applicability within the urban environment. An urban area is perceived as an economic powerhouse within the national economy where the majority of economic activity is generated. The concentration of people and economic activity creates certain positive externalities that should be exploited by residents, businesses and local authorities. High levels of research and development as well as innovation is possible in urban areas and contribute to realize increased economic growth and development. Unfortunately, urban areas also experience negative externalities and this should be addressed because this leads to a decrease in economic efficiency and thus a decline in quality of life. The study thus introduces several options of urban economic policies for use by the local urban authorities. The main aim of these policies is to serve as a framework for local urban authorities to address the typical relevant urban problems in order to stimulate sustainable economic growth and development and quality of life.