Factores culturales que influyen en la escuela

As noted in chapters 1 and 2, the emerging economy is argued to be driven by knowledge, and not physical resources. As such, critics consider traditional factors of material production, such as financial incentives and physical infrastructures, as obsolete means of economic development. The question, though, is what practitioners think about their current role.

Despite the importance of knowledge-based strategies for competitiveness in the emerging economy, practitioners argued that the significance of incentives and physical infrastructure for economic development cannot be underestimated. They noted that the value of financial incentives and physical infrastructure for economic development may have declined in the emerging knowledge economy, but their use is not obsolete (Table 4.4). Practitioners dismissed the criticism that incentives and infrastructure are

“outmoded”, with one practitioner providing the following analogy.

Believe me incentives and infrastructures are still very important. Don’t believe everything you hear. It’s easier said than done. You will hear commentators write some articles saying that companies are not coming because of incentives but rather because of well-equipped workforce and so on. That is only partially true. Assuming you have apples to apples and if you are a company and you are

looking to locate a head office somewhere and all things being considered equal, and you have one community saying we don’t give incentives because we are so awesome by the way, we are not going to provide you with infrastructure over a community that says that you know what we have all those things plus we gonna give you some infrastructure and we gonna give you some incentives, where would you go? (PLED, MM, 16).

Another practitioner agreed, stating,

Even though knowledge is less about brick and mortar and we are getting into the face of clicks and mortar, it is going that way but it is not there yet. The fact that the knowledge industry does not necessarily need brick and mortar does not mean it does not need incentives. Trust me any business looking to locate is interested in knowing what incentives and physical facilities are available, what deals are available and it is all ingrained within the business (PLED, SM, 10).

The two preceding comments were typical, with most practitioners arguing for a balance between using knowledge strategies and using financial incentives and

infrastructure investments. However, practitioners from mid-sized and small

municipalities seemed to have a somewhat stronger support than practitioners from large municipalities for the continuing value of traditional production factors for economic development. In contrast to mid-sized and small municipalities, large municipalities have diverse and well-resourced economies, and practitioners from large municipalities viewed the emerging knowledge economy as an opportunity to adopt new, innovative policies for competitiveness.

Table 4.4 Summary of views about the role of financial incentives and physical infrastructure within economic development policies

 Most practitioners thought financial incentives were still germane. For instance, financial incentives were significant for redeveloping existing properties (e.g., brownfields).

 Financial incentives are also vital within the schemes of community improvement plans (CIP).

 Physical infrastructure is equally crucial to the success of economic development processes (e.g., research and development facilities, incubators, business parks).  Financial incentives and physical infrastructure have value for North American

municipalities, given strong competition from low-cost countries.  Although knowledge is essential, it is only part of the resource. Physical

infrastructure is imperative to tap other resources withinmunicipalities.

 Municipalities’ resources and assets affect economic development. For example, municipalities that have natural resources need the physical infrastructure to extract and export them.

In particular, local officials from mid-sized and small municipalities noted that incentives and infrastructure were still very essential to their development efforts if they were to stay competitive within the larger global economy. Practitioners pointed to strong competition from low-cost producing countries (e.g., low costs of labour, lax

environmental regulations). They explained that without efficient physical infrastructures and financial incentives, their economies could not compete effectively with such

countries. Additionally, practitioners from mid-sized and small municipalities compared themselves with larger cities within Ontario and Canada and argued that larger

municipalities have a host of advantages already in their favour, such as a diverse economy, a large population base, and an efficient infrastructure. Subsequently, they justified the use of financial incentives and continuing investment in physical

infrastructure as a way to be competitive, or, as one practitioner stated, “to ensure a reasonably equal playing ground” (PLED, MM, 6).

in infrastructural facilities. For example, practitioners argued that without financial incentives, private businesses will normally be reluctant to invest in risky projects that involve a large capital outlay, most notably brownfield projects. A practitioner posited that

I definitely think that financial incentives are relevant to economic development in [our municipality]. I don’t think we would have seen half the brownfield redevelopment we’ve had in the last 10 years had we not had the provincial incentive program (PLED, MM, 5).

Furthermore, practitioners generally agreed with policies in Ontario that prohibit municipalities from giving bonuses to attract businesses for economic development purposes. An unrestricted environment, the practitioners argued, can lead to “municipal warfare”. Instead, they strongly supported incentives for broader municipal projects, projects that will generate growth and enhance municipalities’ well being, as one practitioner explained below.

Municipalities are being very creative in the incentives that they can provide. The municipal act says that you’re not allowed to provide incentives. But there are lots of ways to work around that if a municipality wants to. Whether it’s provisioning of services to the site that weren’t there before hand, whether it’s assisting with funding applications to a greater extent than a lot of other communities would do. Overall I think incentives that are targeted at community based-projects are important (PRED, 2).

Some practitioners provided specific scenarios whereby the provision of physical infrastructure helped attract companies, as captured in a regional practitioner’s response below.

An example is in Windsor where a wind turbine company was looking for a building facility. There was a building in the city that was tooled a mold facility. The economic development office actually found them a different smaller location, so that they could locate this wind turbine company in the old building which is a huge facility at very attractive prices. So it’s not technically an

incentive because they went above and beyond and the building that this company has landed in is way below market rates. Did they provide a financial incentive? Well, not technically. Was it a huge financial incentive to the company? The

answer is absolutely yes (PRED, 2).

Many of the officials believed that incentives and infrastructure are fundamental for designing and implementing knowledge-based strategies. As one official noted,

You can’t just implement your knowledge-based policies anywhere, you’d have to have some sort of R&D facility already or you need to have some physical attributes that makes your R&D focus more welcomed by some corporations. The infrastructure of the city is very important to attracting the knowledge economy (PLED, SM, 1).

Similarly, a practitioner from a small municipality emphasized that, in addition to infrastructure for promoting the knowledge-based economy, the municipality focused on support services for economic prosperity. As this practitioner explained,

The physical infrastructure is still very important. There is no doubt about that. We’re working with the municipality, the region, the city of Toronto, the province and the federal government to improve the transit infrastructure and the road infrastructure so that we can attract the right business and people to the region. That type of infrastructure is still central to economic development (PLED, SM, 7).

Furthermore, practitioners asserted that communication within the municipality was crucial for circulating knowledge and, consequently, developing a knowledge-based economy. Although ideas can be exchanged from home locations, face-to-face

interactions, which are very effective for producing innovative ideas, typically occur in facilities. Thus, providing an efficient communications infrastructure to exchange ideas between people and businesses is critical for developing a knowledge-based economy, as indicted by the comment below.

Personal interaction is hugely important. If there was a school of thought that said with the internet and electronic communication everybody could just stay home and you didn’t need buildings, you could just share knowledge online somehow, yes you can do that, people do that, and yes it’s useful but business is still driven by relationships. You have to personally engage people within a physical

environment (PLED, LM, 12).

infrastructure is theoretical only. In practice, however, creating a knowledge-based economy not sustained by infrastructure is inconceivable. One participant from a mid- sized municipality explained that the municipalities’ economic prosperity was based on either land or a readily available infrastructural network:

I believe in the concept that building the knowledge economy is key and central but we still work within the parameters of a built urban structure. So we have developed many things with land that has made our good luck happen. For example, we have a number of think tanks in [our municipality], those all happened because [our municipality] came to the table with either land or infrastructure. If we don’t have a place to put our employment, we will still lose the deal, so place still plays a role. As an economic development philosophy and approach, I will agree with this but I would not say land and infrastructure are irrelevant since they are still part of the equation (PLED, MM, 15).

Only three of twenty officials thought that knowledge-based strategies were more important than financial incentives and physical infrastructure. One of those participants claimed that implementing knowledge-based strategies increased interest in the

municipality by well-known multinational firms, as recounted below.

…because we were able to embrace knowledge-based strategies, it’s has put us on the international map. Why do you think Microsoft always comes here to secure a lot of our employees and university graduates? It’s no secret that because we do have that talent right here. So knowledge policies are really critical for us (PLED, MM, 2).