The Narrative of Enterprise and the Enterprise of Narrative: Place Marketing and the Entrepreneurial City

This on-line version is the pre-copyedited, preprint version. The published version can be found here:

 ‘The enterprise of narrative and the narrative of enterprise: place marketing and the entrepreneurial city’, in T. Hall and P. Hubbard, eds, The Entrepreneurial City, Chichester: Wiley, 77-99, 1998.

 

By: Bob Jessop[1]

In a recent survey of trends in a wide range of European cities, Parkinson and Harding argue that ‘the years to 2000 will be an age of entrepreneurial cities’ (1995: 66).[2] This trend continues a general movement over the last decade ‘towards greater entrepreneurialism, more intense inter-urban competition and the conscious promotion of place-specific development strategies’ (1995: 67). Moreover, as these authors suggest, this involves more than an objective trend in urban economic development policy; for being an ‘entrepreneurial city’ has also become a central element in many cities’ self-images and/or place marketing activities. This is well-illustrated by the reworking of the thematic of the ‘entrepreneurial city’ as a key feature of urban discourses connected with the ‘enterprise culture’ in Britain, North America, and the antipodean outposts of neo-liberalism. Nor is this thematic restricted to neo-liberal discourses: entrepreneurial city strategies can also be linked with neo-corporatist, neo-statist, or even community-based modes of governance. But it is usually conceded that the eventual success of all such strategies will still depend on market forces.

Thus, after the defeat of leftwing ‘municipal socialist’ strategies opposed to Thatcherism in Britain, a new economic consensus has emerged at local and regional level. This emphasizes cities’ need to promote economic and extra-economic conditions for sustainable endogenous development; and/or to market themselves as being ‘business-friendly’ as well as committed to working with the private sector. In both regards there is a strong emphasis on the role of partnerships (operating on various levels of social organization,[3] in and across different functional domains, and on different spatial scales) in the active promotion and support of these policies. This approach is now part of the mainstream (or ‘centrist’) understanding of local economic development strategy in Britain (Eisenschitz and Gough 1993); and it is likely to survive the transition to New Labour (if only because of continued financial constraints on government spending). Moreover, despite some obvious and necessary local variations, these initiatives typically share an ‘entrepreneurial’ concern to innovate through ‘new combinations’ of economic and/or extra-economic factors to further urban and regional competitiveness. Similar trends are found beyond Britain in Europe and elsewhere; and, whilst especially evident, perhaps, for cities and regions, they are also advocated for nations and supra-national blocs (e.g., Eisinger 1988; Ettlinger 1994; Fosler 1988; Gaffikin and Warf 1993; Harvey 1989; Hirsch et al., 1991; Keating 1993; Leitner 1989; Mayer 1994; Preteceille 1990; Przeworski 1986; Stewart and Stoker 1989; Stöhr 1989, 1990; Storper and Scott 1995).

The frequently alleged novelty of such narratives and policies is, of course, at odds with the historical record. For, as the editors of this volume have noted elsewhere, ‘city governments, to a less or greater extent, have always pursued entrepreneurial strategies and played a crucial role in local economic development’ (Hall and Hubbard 1996: 155). There are, nonetheless, real discontinuities with the immediately preceding phase, in some British cities, of municipal socialism; and, indeed, with the more common municipal welfarism that developed here over the postwar period. Such discontinuities can be discerned not just in cities’ currently preferred economic policies but also in the discourses and self-images associated with them. In this sense, then, we can still ask, firstly, why local economic development policies have recently been re-oriented (at least in part) to promote local innovation and other supply-side conditions favouring business enterprise; and, secondly, why these entrepreneurial strategies have come to be explicitly narrated as ‘entrepreneurial’ in character.

We should also consider how these changing narratives and economic functions are related. Among possible links, three merit attention here. First, there is a complex, multi-dimensional crisis of cities as forms of socio-economic, civil, and political organization: this has prompted debates over new ways to manage cities and deal with their many and varied problems. In this context, specific problems rooted in uneven economic development within and across nations and a more general fisco-financial crisis affecting all governments are especially important in the resurgence of the ‘entrepreneurial city’ as it attempts to address (endogenous) urban development with limited resources. This does not mean, of course, that such economic changes and constraints alone explain the rise of the entrepreneurial city. Instead they are more appropriately seen as setting the context within which debates and struggles over the future of particular cities and/or the ‘city’ in general occur. Second, these general urban crisis-tendencies have been aggravated by the changing status of the national state at home and abroad, which is often linked to overly exaggerated claims about the crisis of the national state. This changing status is reflected in recent reorientation of its economic and social roles, encapsulated in such notions as ‘competition state’ (Cerny 1989) or ‘Schumpeterian workfare state’ (Jessop 1993). These changes have in  turn made cities and their hinterlands more significant as nodes and vectors in organizing economic, political, and social life than they were during the period of Atlantic Fordism. They have also highlighted the importance of cities’ differential capacities to reflect on and secure the conditions for economic dynamism (cf. Storper 1997). And, third, major changes in prevailing modalities of competition in an increasingly ‘globally integrated’ but still multi-scalar, unevenly developing, and tangled economy are modifying both the forms and interrelations of inter-urban as well as international competition. All three sets of factors have contributed to important shifts in the role of cities as subjects, sites, and stakes in economic restructuring and systemic (or structural) competitiveness.[4]

It is in this context that the present chapter tries to define the nature of ‘entrepreneurial cities’ and identify the various ways in which cities can be (said to be) entrepreneurial. I take my theoretical lead here from the work of Schumpeter, an emblematic thinker for contemporary capitalism, who defined entrepreneurship as the creation of opportunities for surplus profit through ‘new combinations’ or innovation (Schumpeter 1934; see below). This provides the basis for distinguishing between entrepreneurship oriented towards strong competition and that oriented towards weak competition. This distinction in turn derives from Cox’s work (1995). Thus, whereas strong competition refers to potentially positive-sum attempts to improve the overall (structural) competitiveness of a locality through innovation, weak competition refers to essentially zero-sum attempts to secure the re-allocation of existing resources at the expense of other localities. Cox adds that, whereas weak competition is socially disembedding, strong competition involves the territorialization of economic activity (1995: 218). Combining these closely related approaches leads me to claim that, despite the increasingly common rhetoric and narrative of ‘entrepreneurialism’, there are few cities which genuinely qualify for this title in the strong sense. For there are few cities which are systematically oriented to securing sustainable dynamic competitive advantages through continuing economic, political, and social innovations that are intended to enhance productivity and other conditions of structural and systemic competitiveness. And even those that do have such an orientation tend to fail for various reasons to ensure continued capital accumulation. Weaker forms of competition are usually more concerned with modifications in formal and substantive regulatory, facilitative, or supportive measures[5] aimed at capturing mobile investment (a deregulatory race to the bottom) as well as simple image-building measures with the same purpose (boosterism). Cities engaged in such weak entrepreneurialism are even more likely to fail in the longer term because of the ease with which such activities can be copied.

In developing these claims I initially address the issue of entrepreneurship in relatively abstract theoretical terms. I then illustrate some of these arguments by distinguishing four (by no means exhaustive) types of relatively weak entrepreneurial economic strategy (often closely linked to place-marketing narratives and activities) which typify much of what has passed for economic development strategies in a Britain dominated from the early 1980s by a neo-liberal accumulation strategy at the national level — with little sign at the time of writing that matters will change under ‘New Labour’. These strategies are primarily concerned with securing economic growth by finding the most suitable forms of insertion of local economic (and often, indeed, micro-economic) spaces into the broader spatial division of labour. In presenting these strategies I am not suggesting that they are the only strategies currently being pursued in Britain nor, even more importantly, that they exhaust the range of weak or strong entrepreneurial strategies that could be pursued in more neo-corporatist, neo-statist, or associationalist contexts. My concluding remarks once again turn to more abstract and general considerations on the limits of economic strategies, entrepreneurial or otherwise.

I. Narratives of Enterprise: Competitiveness and Entrepreneurial Cities

The distinctive feature of ‘competition states’ at national or European level and of ‘entrepreneurial cities’ at urban and regional level is their manifest function of — or, at least, their declared self-image as proactively engaged in — promoting the capacities of their respective economic spaces in the face of intensified competition in the global economy. This is often linked in turn to changes in forms of government and governance. Thus Parkinson and Harding have described the entrepreneurial city as ‘one where key interest groups in the public, private and voluntary sectors develop a commitment to realising a broadly consensual vision of urban development, devise appropriate structures for implementing this vision and mobilise both local and non-local resources to pursue it’ (1995: 66-67). Elsewhere Harding has defined the content of these entrepreneurial policies as involving growing concern with:

the state of the local economy; the fortunes of locally-based businesses; the potential for attracting new companies and/or promoting growth within indigenous firms; the promotion of job-creation and training measures in response to growing urban unemployment; the modernisation of the infrastructures and assets of urban regions (communications, cultural institutions, higher educational strengths and capacities) to attract investment and visitors and support existing economic activities; and the need to limit further suburbanisation, retain population (particularly middle-to-upper income families) and workplaces and create compact, livable cities (Harding 1995: 27).

This raises the interesting and important question why the response to the above-mentioned economic and fiscal crisis of cities and regions should take the form of what I have described above as entrepreneurial measures narrated in entrepreneurial terms. Two issues are posed here: policies and discourses. For, whatever the objective economic and political conditions prompting such policies might be, the development of the latter is always mediated through changing understandings of competitiveness as linked to emerging discourses about the ‘competition state’, the ‘entrepreneurial city’, and, most recently, the ‘learning region’.

Competitiveness

Economic competitiveness is an essentially contested, inherently relational, and politically controversial concept. There are many ways to define it, many modalities of competition, and many sites of competition. The key question for present purposes, however, is whether nations and cities can be ‘units’ and/or ‘subjects’ of competition. A secondary question, assuming for the moment a positive answer, is whether the conditions of success for a city or nation are analogous to those for a single firm (on nations, Porter 1990 and Warr 1994; on cities, see also Porter 1995; Storper 1997). Can nations and cities achieve competitiveness in similar ways to firms and, if not, can (or do) they pursue economic competitiveness in the same way as each other? Only if cities are meaningful units of competition and can also pursue competitive strategies can we speak of their actually becoming ‘entrepreneurial’ actors as opposed to merely representing themselves as such through entrepreneurial narratives. Otherwise, they can at best be seen as spatialized configurations of institutions and practices that offer more or less favourable conditions for individual firms (or alliances and/or networks of firms) to compete in a more or less entrepreneurial manner. How this occurs will vary, of course, with the changing nature and forms of competition.

Two general points need making about competition, competitive advantage, and entrepreneurialism before we consider their particular relevance to cities. First, there are many types of competitive advantage and different bases of each.[6] One useful distinction is that between static comparative and dynamic competitive advantages. Whilst the former refer to superior so-called ‘natural’[7] factor endowments as compared to those of potential trading partners, the latter are somewhat more obviously socially created and can also be socially transformed.[8] If competitiveness is understood purely in terms of comparative advantages, what matters is the overall efficiency of resource allocation, especially in producing traded goods and services. This approach is often said to be most relevant to nations, regions, or cities that are currently producing primary products and standardized manufactured goods. But such factor-based advantages are usually hard to sustain — especially given the standardization of many technologies and capital goods (permitting their relatively quick and easy adoption if the necessary finance and skills are available), the mobility of international capital (reflected in access to mobile money capital as well as productive capital’s search for lower production costs), and the shift of comparative advantages over the product cycle (which puts increasing emphasis on production costs as markets mature) (cf. Warr 1994). This suggests longer-term competitiveness would be better based on developing and maintaining dynamic competitive advantages. This holds not only for firms but also for industrial or central business districts, cities, regions, nations, and any other spaces able to create spatialized competitive advantages. The more broadly these are understood (including the social context of enterprise), the more one can talk of structural or systemic competitiveness (on structural competitiveness, see Chesnais 1986; and, on systemic competitiveness, Messner 1996; Esser et al., 1996).

Using this distinction, it is clear that not all so-called ‘entrepreneurial cities’ are concerned with the same forms of competitiveness. In some cases policy innovations involve little more than attempts to secure largely static comparative advantages by attracting inward investment from mobile capital at the expense of other places through such measures as tax breaks, subsidies, and regulatory undercutting and/or simple, civic boosterist image-building. In other cases, cities and regions introduce economic, political, and social innovations to enhance productivity and other conditions affecting the structural and/or systemic competitiveness of both local and mobile capital. This would be reinforced to the extent that they possess a socially dense, ‘institutionally thick’ space for economic reflexivity and the flexible pooling of risks and uncertainties in an increasingly turbulent national, regional, and global environment (cf. Storper 1997; Veltz 1996).

The Entrepreneurial Function

The concept of entrepreneurship is applicable, in principle at least, to any field of activity where innovation generates benefits which are appropriable — at least temporarily — by the innovating agent. This helps to explain the concept’s current popularity in political and policy analysis. Moreover, as commodification and market mechanisms are extended to more spheres of social activity, the scope for economic entrepreneurialism proper is also expanded. It is the economic entrepreneurialism of cities that concerns us here.

In the economic sphere, entrepreneurship is a function that can be exercised at any moment in the overall circuit of capital and/or the articulation of these moments. But it must be distinguished from the routine reproduction or regularization of the circuit: it always involves some form of innovation or ‘new combination’. Likewise, although exercising an entrepreneurial function typically involves uncertainty (since innovation means venturing into the unknown), it is far from identical with economic speculation or economic risk-taking in general.[9] Indeed Schumpeter claims that the entrepreneur as such is never a risk-bearer: the economic risks involved are a function of capital not entrepreneurship (Schumpeter 1934: 137).[10] For the distinctive function of the entrepreneur is innovation rather than technical invention (however original this may be), the routine management of capitalist activities, or the bearing of risk. Entrepreneurship in its strict, strong, or Schumpeterian sense involves the devising and realization of new ways of doing things to generate above average profits (i.e., ‘rents’ or, in Marxist terminology as applied to production, relative surplus-value) in the course of capitalist competition. Moreover, although it is common to equate the entrepreneur with the individual business dynamo, the function(s) of entrepreneurship can be exercised through various types of agency. Indeed its forms will vary with the nature of combinations, the forms of competition, and the objects of entrepreneurial governance. Finally, we should note that, like all economic activities, entrepreneurship is socially embedded. Thus individual entrepreneurs are commonly socially embedded in networks of interpersonal relations (even where their gift or capacity for innovation is linked to marginality from the wider society); entrepreneurial firms or organizations are institutionally embedded; and an entrepreneurial society is embedded in complex web of institutional orders (and lifeworlds) which sustain structural competitiveness and provide an enterprise culture. Entrepreneurial cities in the strong sense are likely to combine all three forms of embeddedness.

Schumpeter listed several ways in which entrepreneurial innovation can occur:

(1) The introduction of a new good – that is one with which consumers are not yet familiar – or a new quality of a good. (2) The introduction of a new method of production, that is one not yet tested by experience in the branch of manufacture concerned, which need by no means be founded upon a discovery scientifically new, and can also exist in a new way of handling a commodity commercially. (3) The opening of a new market, that is a market into which the particular branch of manufacture of the country in question has not previously entered, whether or not this market has existed before. (4) The conquest of a new source of supply of raw materials or half-manufactured goods, again irrespective of whether this source already exists or whether it has first to be created. (5) The carrying out of the new organisation of any industry, like the creation of a monopoly position (for example through trustification) or the breaking up of a monopoly position (Lim 1990: 215, summarizing Schumpeter 1934: 129-135).

Although the phrasing of Schumpeter’s list of ‘new combinations’ bears the imprint of commercial and industrial capitalism, nothing limits it to these fields. It can clearly be applied to innovations in other fields, such as new forms of finance; and it also embraces the specifically spatial and/or temporal dimensions of commercial, industrial, financial, or other forms of economic activity. It is worth emphasizing the potential scope of a Schumpeterian analysis because of the increased significance of services, the increased importance of space and time in dynamic competitive advantages, and the more general redefinition of the ‘economic sphere’. Regarding the last of these three tendencies, we can note that discourses of structural or systemic competitiveness now claim that such a capacity depends not only on an extensive range of economic factors (as one might readily suspect) but also on the valorization of a wide range of extra-economic institutions and relations. Indeed Pierre Veltz has recently suggested, against orthodox economics, that the ‘extra-economic’ is [now] at the heart of the ‘real economy’ (1996: 16). This feature of contemporary capitalism is reflected in the growth of new technologies based on more complex national and regional systems of innovation, in the paradigm shift from Fordism with its emphasis on productivity growth rooted in economies of scale to post-Fordism with its emphasis on mobilizing social as well as economic sources of flexibility and entrepreneurialism, and in more general efforts to penetrate the micro-social level in the interests of valorisation. Such changes have major implications for local and regional governments at local and regional levels in so far as supply-side policies are supposedly more effectively handled on these scales than at the national level; and for governance in so far as public-private partnerships are more effective than traditional legislative, bureaucratic, and administrative techniques. It is in this context that we can try to locate the rise of urban entrepreneurial policies narrated in entrepreneurial terms.

Urban Entrepreneurship

There are obvious analogies between Schumpeter’s list of economic innovations and the activities associated with urban entrepreneurship. Moreover, just as his original list comprised analytically distinct but empirically overlapping or interdependent activities, the same holds for the entrepreneurial city and its undertakings. Attention should also be paid to the increasing interdependence between innovation and marketing in these areas: issues of image, representation, narrative, and discourse arise in all five fields of urban innovation. These fields comprise:[11]

1) the introduction of new types of urban place or space for living, working, producing, servicing, consuming, etc.. Examples include multicultural cities, cities organized around integrated transport and sustainable development, and cross-border regional hubs or gateways.

2) new methods of space or place production to create location-specific advantages for producing goods/services or other urban activities. Examples include new physical, social, and cybernetic infrastructures, promoting agglomeration economies, technopoles, regulatory undercutting, re-skilling.

3) opening new markets — whether by place marketing specific cities in new areas and/or modifying the spatial division of consumption through enhancing the quality of life for residents, commuters, or visitors (e.g., culture, entertainment, spectacles, new cityscapes, gay quarters, gentrification);

4) finding new sources of supply to enhance competitive advantages. Examples include new sources or patterns of immigration, changing the cultural mix of cities, finding new sources of funding from the central state (or, in the EU, European funds), or reskilling the workforce.

5) refiguring or redefining the urban hierarchy and/or altering the place of a given city within it. Examples include the development of a world or global city position, regional gateways, cross-border regions, and ‘virtual regions’ based on interregional cooperation among non-contiguous spaces.

In each regard we can see that urban entrepreneurialism contains the element of uncertainty that many see as the very essence of entrepreneurial activity. In this sense ‘it is speculative in execution and design and therefore dogged by all the difficulties and dangers which attach to speculative as opposed to rationally planned and coordinated development’ (Harvey 1989: 7). This may be a further reason why cities are becoming more entrepreneurial. For the nature of risk and uncertainty is changing and some theorists argue that we now live in a ‘risk society’ (Beck 1992). Without directly responding or referring to this latter argument, Storper’s more recent analysis of the ‘reflexive city’ claims that uncertainty and risk are changing in a period when market forces and the extra-economic environment for economic actors are becoming more turbulent, more influenced by the strategic calculation of other actors, and more open to influence on a wide range of spatial scales. This puts a premium on forms of urban organization which enable economic actors to share risks and to cope with uncertainty through dense social and institutional networks (Storper 1997; cf. Veltz 1996).

Whether in regard to firms or cities, there is a typical economic dynamic to entrepreneurial activities. As an integral element in competition, they are inseparable from its attendant risks and uncertainties. Although a successful innovation will initially generate surplus profits (or ‘rents’), these tend to decline and eventually disappear as the innovation is either adopted (or superceded) as ‘best practice’ by other competitors and/or as less efficient competitors (are forced to) leave the market. Unless an effective (practical or legal) monopoly position can be established, this will tend to return profits to normal levels.[12] Moreover, once an innovation is generalized, the cost of production and the search for new markets begins to matter, changing the balance of competitive advantages within the product cycle. Whilst this emphasis on costs leads to the competing away of initial advantages, it also prepares the ground for the next wave of innovation and entrepreneurship — either by the initial pioneers or perhaps latecomers who are able to exploit their competitive position in a later stage of the product cycle to build a resource base for subsequent innovations. Making due allowance for obvious differences in the product and its associated cycle, this dynamic is seen in inter-urban competition. The capacity of global cities to remain at the top of both world and national hierarchies is linked to their ability to remain at the forefront of economic and institutional innovation. But inter-urban competition can also lead to displacement of competitive advantages across cities lower down the hierarchy. Some cities begin apparently irreversible decline as they are out-manoeuvred by innovations in other established or emerging cities; this is especially likely where their initial superiority in the hierarchy was based on static comparative advantage.  At the same time, of course, imitation and speculation can also lead to overproduction both within individual growth centres and in general through diffusion. This is the ‘crowding’ phenomenon noted by Schumpeter (1934: 131-2). It is currently reflected in the ‘serial production of world trade centres, waterfront developments, post-modern shopping malls, etc.’ (Harvey 1989: 10). In general, as Krätke’s work on the changing urban hierarchy in Europe suggests, the trajectories of cities in the ‘snakes-and-ladders’ game of inter-urban competition are closely related to (a) the quality and richness of control capacities, finance and service functions; and (b) specialization in innovative or traditional industrial production structures. The capacity to remain at the top of the hierarchy or to move up it depends on cities’ capacities and strategies for acquiring complex strategic activities and/or promoting innovative production (Krätke 1995: 136-142). All of this points to the importance for inter-urban competition of entrepreneurial capacities.

II. Entrepreneurial Cities?

This said, there are both theoretical and practical dangers in accepting uncritically the narratives and/or discourses of the ‘entrepreneurial city’. Theoretically, we run the risk of treating the city unproblematically as a subject capable of action. Even if this risk is avoided, however, there are clear dangers in trivializing urban entrepreneurial activities by reducing them to all manner of routine activities which are directly economic or at least economically relevant; and/or in mistaking a city’s self-image and place-marketing as entrepreneurial for the presence of strong entrepreneurial activities. Thus some cities may simply be administering or managing an existing business-friendly climate efficiently rather than actually engaged in innovation. That this may be sufficient to maintain capital accumulation does not mean that the city concerned is entrepreneurial. Likewise, some cities may be engaged in nothing more than routine place-marketing. Furthermore, on a practical level, there is a risk that most cities believe they can succeed in the entrepreneurial race and/or can successfully pursue policies that have worked elsewhere. If every city is entrepreneurial in a ‘me-tooist’ way, however, any resulting particular competitive advantages may well prove ephemeral. This is especially risky for accounts of entrepreneurship which ignore the complex contextual conditions making for success and emphasize instead the ‘animal spirits’ of gifted individuals or equally inspired corporations. So let us first consider how the idea of entrepreneurship could apply to cities.

Although early work tended to see entrepreneurs as heroic individuals (which would exclude cities from exercising their functions), it has long been accepted that entrepreneurship can also be exercised collectively. This holds not only for organizations such as firms (whether acting alone, in strategic alliances, or in networks) but also to institutional complexes such as the state. This led Schumpeter to argue that the function of heroic individual entrepreneurs was losing its social significance as innovation became more routinized and met less resistance (1943: 132). Prima facie, this suggests that cities could, perhaps, become socially more significant in this regard.

From a structural viewpoint, an ‘entrepreneurial city’ would be one which is so institutionally and organizationally equipped that it offers a privileged strategic space for innovation. From a strategic viewpoint, it would be one that has achieved the capacity to act entrepreneurially. It may then itself directly act as an economic entrepreneur, targeting one or more of the above-mentioned facets of the urban ‘product’; and it may also actively promote various institutional and/or organizational conditions favourable to more general economic entrepreneurship on the part of other forces. Finally, from a purely discursive viewpoint, a city may present itself as ‘entrepreneurial’ in structural and/or strategic terms — without necessarily meeting the relevant conditions.

The possibility of localities becoming subjects is crucial to the second and third of these possible forms of entrepreneurial city. This is an issue that is hotly debated by various urban geographers. There is a real danger of equating cities merely with the city’s political leaders and other notables or, alternatively, with a specific growth or grant coalition. Indeed, Harvey warns against language which makes it seem as if ‘cities’ can be active agents when, in his words, they are mere things. He calls instead for analyses of urbanisation ‘as a spatially grounded social process in which a wide range of different actors with quite different objectives and agendas interact through a particular configuration of interlocking spatial practices’ (Harvey 1989: 5). Conversely, Cox and Mair are more than happy to discuss preconditions for localities to become subjects. They suggest that:

If people interpret localised social structures in explicitly territorial terms, come to view their interests and identities as “local”, and then act upon that view by mobilising locally defined organisations to further their interests in a manner that would not be possible were they to act separately, then it seems eminently reasonable to talk about “locality as agent” (Cox and Mair 1991: 198).

Clearly, these requirements would also apply (without thereby exhausting all the necessary conditions) to cities’ capacities to mobilise diverse social forces and organizational (meta-)capacities in pursuit of entrepreneurial projects. Among the key elements to be considered here are: the discursive constitution of the identities and modes of calculation which justify claims about an ‘imagined community of entrepreneurial interest’ and its associated collective project, the various actors (not necessarily local or locally dependent) who are mobilized behind the entrepreneurial strategy, the various interpersonal and (inter-)organizational mechanisms through which such forces are mobilized and given coherence, and the manner in which these mechanisms are embedded in broader social arrangements so that the capacities of the city (or localized social structure) are in some sense collective and thus irreducible to those of individual actors resident or active therein (on the last of these points, see Cox and Mair 1991: 204). At stake here are the forms in which cities can and do ‘add value’ in the (capitalist) economic process by providing a complex of localised and specific economic and extra-economic assets which are socially regularized and socially constructed (cf. Storper 1997: 17-19).

In structural terms, this requires us to look at the spatialized complex of institutions, norms, conventions, networks, organizations, procedures, and modes of economic and social calculation that sustain entrepreneurship. In strategic terms, one should look well beyond city dignitaries to assess the involvement of a wide range of actors behind a collective project and the institutional factors that help to consolidate their support. These actors can include branches of the local and/or central state, quangos and hived-off state agencies, political parties, firms, consultancies, trade associations, chambers of commerce, employers’ organizations, business roundtables, trade unions, trades councils, citizens’ and community groups, voluntary sector organizations, public-private partnerships, local educational and religious institutions, new social movements. How solid such projects are will depend on their interpersonal, interorganizational, and institutional embeddedness (hence the existence not only of partnerships but networks of partnerships structured both horizontally and vertically) as well as their feasibility in the light of existing structural constraints and horizons of action.

Among such projects one can include measures to support entrepreneurs (e.g., venture capital, subsidies, business parks, technology transfer mechanisms and technical assistance, investment in knowledge production through public R&D or locally-oriented R&D consortia, industry service centres, local and regional development funds, public procurement policies, and so forth). Also relevant are policies that aim to increase the overall supply of entrepreneurs, to develop enterprise skills/competencies in under-represented sectors (such as ethnic minorities or women), or to promote new forms of enterprise (such as cooperative or community venture programmes). More generally one might say that such policies should favour ‘approaches that are (a) context-sensitive, i.e., concerned with the embeddedness of industrial practices in specific contexts and regions, (b) production-systems-oriented rather than firm-oriented, and (c) directed towards the ongoing adjustment capacities of regional economies, rather than once-and-for-all implementation of so-called best practices’ (Storper and Scott 1995: 513). The last of these categories can be extended to include organizational and institutional features that promote a place-specific enterprise culture and society, with creative, flexible, and enterprising citizens (Cho 1996a; Rosa 1992; Storper and Scott 1995: 509-517).

Turning back to the structural aspects of the ‘entrepreneurial city’, there are two dimensions worth exploring. These comprise, first, institutions and structures that directly support entrepreneurs, existing or potential; and, second, institutions and structures that sustain an entrepreneurial climate. An interesting but difficult question in this regard is how far a general climate conducive to entrepreneurship can be attributed to the form of the city itself as opposed to other localized factors, e.g., the presence of well-integrated industrial clusters (Porter), flexible industrial districts (Third Italy), regional systems of innovation, and so forth. It is hard to separate the effects of an entrepreneurial space/place from the effects of specific entrepreneurial city strategies since structure and strategy interact and co-evolve.

One way to resolve this analytical difficulty in distinguishing between what Lipietz (1994) terms a ‘space-in-itself’ and a ‘space-for-itself’ would be to explore the extent to which there is a clear accumulation strategy formulated for the city and its region and to which this strategy has become hegemonic. Thus Lipietz suggests that, for a space-in-itself to become a space-for-itself, a hegemonic bloc and a state are necessary. When these two conditions are organically linked, he continues, one can talk of a ‘regional armature’. This is ‘a space-for-itself where the dominant classes of the hegemonic bloc mobilize ideological and political apparatuses enabling the appropriate regulation at this level [of spatial organization] of some aspect or another of the socioeconomic conflict’ (Lipietz 1994: 27). This notion can clearly be extended to include more than issues of ‘reproduction-regulation’ to include the pursuit of entrepreneurial policies oriented to (permanent) innovation in inter-urban competition. In this context political forces must mobilize not only ideological and political apparatuses but also forms of organizational intelligence and mechanisms for collective learning (Willke 1992, 1997; Storper 1997). Thus, to the extent that the city can be considered as an agent in this regard, one should be able to identify its strategic role (and not merely structurally selective bias) in organizing the conditions for competitive advantages. Entrepreneurial urban policies would be a means to the end of ‘adaptive technological and organizational learning in territorial context’ (Storper and Scott 1995: 513). They would be especially oriented to the meta-problem of the co-variation, co-selection, and co-retention of such policies to produce both a ‘structured coherence’ at local level and dynamic complementarity with other levels (cf. Willke 1992, 1997). The development of such meta-capacities would depend on the supply of relevant knowledge and organizational intelligence rather than capital; on shaping the institutional context in which firms operate rather than providing subsidies; on organizing place-specific advantages rather than an abstract space of flows; and on the (re-)territorialization of activities rather than their emancipation from spatial and temporal constraints. In this way dynamic competitive advantages can be targeted rather than static comparative advantages with the attendant risk of a race to the bottom.

 

III. Changing Spaces of Competitiveness?

The crisis of national economies and the declining capacity of national states to manage national economies as if they were closed has expanded the space for cities and regions to engage in territorial competition. Indeed it sometimes seems that cities are replacing firms as ‘national champions’. This may well be linked to the ‘relativization of scale’ linked with the current dialectic logic of globalization and regionalization. This signifies that, in contrast to the privileging of the national economy and national state in the period of Atlantic Fordism, no spatial scale is currently privileged. Instead there is a more complex nesting and weaving of different spatial scales due to the complex re-articulation of different spatial scales (Amin and Robins 1990; Collinge 1996).[13] This creates complex and changing opportunities for cities to organize territory as a place for production and for fixing capital in place and to organize the city as a space of flows to capture surpluses from the movement of capital and labour (cf. Hall and Hubbard 1996: 160).

Reflecting this dialectic of place and space, views on the mechanisms of inter-urban competition differ. Thus Porter (1995) argues that the logic of competition at the regional and urban levels does not differ in principle from that operating at the level of the nation-state. Indeed, he has applied his ‘diamond’ model to the competitive advantages of the inner city and identified various ways in which its public and private sectors can promote competitiveness by responding positively to the logic of market forces. Boisot goes even further. Using the concept of ‘culture space’, he proposes a much more mercantilist account of territorial competition than Porter and claims far greater room for local industrial policy (Boisot 1993). And even that celebrated management consultant who advocates a ‘borderless world’, Kenichi Ohmae, suggests that there is scope for regional economies and city states in an era of globalization. He argues that what defines regional economies ‘is not the location of their political borders but the fact that they are the right size and scale to be the true, natural business units in today’s global economy. Theirs are the borders — and the connections — that matter in a borderless world’ (Ohmae 1995: 5). On all three readings from quite different perspectives, real competition does seems possible among cities.

The basis of competitive strategies in this regard is always and necessarily an ‘imagined’ economy.[14] The constitution of an economy involves its discursive construction as a distinctive object (of analysis, regulation, governance, conquest, or other practices) with definite boundaries, economic and extra-economic conditions of existence, typical economic agents and extra-economic stakeholders, and an overall dynamic. The struggles to constitute specific economies as subjects, sites, and stakes of competition typically involve manipulation of power and knowledge in order to establish recognition of their boundaries and geometries. The formulation of economic development strategies in this context depends on the dual distinction between: (i) the local economy and the extra-local or supra-local economic context; and (ii) the local economy and the extra-economic local environment (of community, family, polity, and so forth) (see Jessop 1997a). How these distinctions are drawn varies with prevailing images of the economy, modes of competition, and cities’ place therein.

In this context, the current consensus on the need for ‘entrepreneurial’ cities is a product of convergent public narratives about the nature of key economic and political changes affecting postwar Europe and North America — narratives which have been persuasively (but not necessarily intentionally) combined to consolidate a limited but widely accepted set of diagnoses and prescriptions for the economic and political difficulties now confronting nations, regions, and cities and their respective populations. Thus we find selective narrations of past events and forces which generate a distinctive account of current economic, social, and political problems — the resolution of which is now deemed to require decisive changes in the purposes, organization, and delivery of economic strategies focused on the urban and/or regional levels and infused with some kind of entrepreneurial spirit. The entrepreneurial city or region has been constructed through the intersection of diverse economic, political, and socio-cultural narratives which seek to give meaning to current problems by construing them in terms of past failures and future possibilities. These narratives are often linked to complementary discourses that are mobilized to contextualize these changes and reinforce calls for action.

The persuasiveness of this sort of entrepreneurial strategy is closely linked in turn to the parallel discursive constitution of specific sites of economic activity as ‘natural’ (common-sensical, taken-for-granted) units of economic management, regulation, or governance. In the postwar boom years the tendency was for this site to be seen as the national economy; more recently views of ‘naturalness’ have bifurcated in the direction of global and local economies — subsequently synthesized in some strategic contexts (especially by firms and places seeking to attract them) in the idea of ‘glocalization’. In this context cities (and their hinterlands) are increasingly regarded as natural sites for economic innovation and entrepreneurship. Moreover, with the increasing interest in dynamic competitive advantages and the bases of structural and/or systemic competitiveness, the extra-economic dimensions of cities have also come to be increasingly significant in urban entrepreneurial strategies. So-called ‘natural’ economic factor endowments become less important (despite the continuing path-dependent aspects of the positioning of places in urban hierarchies); and socially constructed, socially regularized, and socially embedded factors have become more important for inter-urban competitiveness. Entrepreneurial city strategies must therefore not only position urban place and space in the economic sphere but also in extra-economic spheres.

 

IV. Four Types of Economic Strategy

This section seeks to illustrate in a brief (and necessarily partial) manner some of the preceding arguments. It focuses on some of the weaker forms of urban entrepreneurial strategy — which are, in fact, far more typical than the strong competitive strategies or milieux which characterize the leading cities in urban hierarchies — and the extent to which they are an essential part of narratives of enterprise and place-marketing in the current period. In this sense they are the strategies of the ‘ordinary city’ (Amin and Graham, 1997) rather than the one-sidedly presented and atypical exemplars of hyped-up trends. The typology derives largely from observation of the British case in the 1980s and 1990s and clearly needs to be extended to incorporate other periods in Britain as well as other countries in the European Union, let alone elsewhere. The four strategies to be discussed differ in at least three respects: their respective concepts and discourses of competitiveness, the spatial horizons over which they are meant to operate, and their association with different local contexts and positions in prevailing urban hierarchies. What they share is the key role of local authorities in their overall framing and promulgation. In this sense, for all the talk of the crisis of the state (at whatever level), public authorities still appear to have a major role in organizing entrepreneurial policies for the city (including inner cities and metropolitan regions) and narrating such policies in entrepreneurial terms.

Within the current mainstream local economic development consensus in Britain (Eisenschitz and Gough 1993), there is still scope for the strategies pursued by local authorities, economic development agencies, and public-private partnerships to reflect local strategic contexts. Indeed, subject to overall compliance with the top-down imposition of a neo-liberal orientation and its attendant fisco-financial constraints, this was one of the explicit goals of the continual redesign of the local economic strategy apparatus under the Thatcher and Major governments. Thus local authority involvement in economic development is now as much about shaping the overall context within which partnerships (whether local, regional, trans-local or trans-regional) can be forged, as it is about developing specific strategies and initiatives (a role which is increasingly devolved to individual firms, consultancies, private associations, or public-private partnerships). Local authorities appear to be increasingly required to engage in a process of near permanent institutional and organisational innovation in order to maintain the possibility (however remote) of sustained economic growth. In this sense, even if they do not act directly as economic entrepreneurs (as sponsors of property-led development, tourist spectacles, etc.), cities must promote an entrepreneurial environment on a range of scales which might help to sustain local growth and make the best of any opportunities to promote entrepreneurship and/or market their places/spaces. In this latter regard four main strategies can be identified.

IV.1 The Search for Growth: Local-Regional-National…

An increasingly common strategy is for cities and regions to pursue some form of ‘structured complementarity’ by building favourable linkages to the wider economy. This is typically reflected discursively in attempts ‘to position places centrally on “stages” of various spatial scales: regional, national, international, global’ (Hall and Hubbard 1996: 163-4). And, on a practical level, it typically involves promoting local economic development by exploiting growth dynamics at progressively ascending spatial scales from the local through the regional and national to the supranational. However, it may also involve uncoupling the local economy (at least temporarily) from the wider economy: either to protect it from the negative impact of wider economic processes or to by-passing more immediately encompassing scales to seek closer integration with processes on other scales (such as the EU).

Economic strategy documents from district, metropolitan, and county authorities from the 1980s and 1990s suggest this is the conventional view of the basic conditions for local economic development in mainland Britain. Specific locales and growth foci must be positively co-ordinated in the local economy; the local economy in turn must be favourably linked to sub-regional economic spaces; sub-regional economic spaces with regional modes of growth; and so forth. To this end, local economies must first be identified. This involves their discursive construction as a spatially-specific object of economic regulation and/or governance; and the definition of potential complementarities within the ‘local economy’ and across local growth foci then becomes a basis for exploiting external dynamics. Local economic development projects and their associated accumulation strategies must then be inserted within, and draw growth potential from, sub-regional and regional growth opportunities wherever they exist.

IV.2. The Search for Growth: Trans-National Local Alliances

For some regions, however, improved communications and infrastructural linkages with Europe have also facilitated a certain by-passing of the national state[15] and the corresponding need for a complementary mode of insertion within a national accumulation strategy. Indeed, as strategies based upon constructing urban growth regimes in a neo-liberal context have proved hard to realize and as the possibilities of by-passing the national state have begun to reveal themselves, a series of compensating or buttressing economic development strategies have recently emerged. These strategies are connected to the tendential ‘hollowing-out of the national state’ and its associated ‘relativization of scale’ (Collinge 1996). For the development of a Single European Market and improved communication links to the Continent have prompted greater involvement of UK local authorities in trans-local and trans-regional linkages (Benington 1994; Benington and Harvey 1994; Cappellin 1992; Maillot 1990; Sinclair and Page 1993). They are designed to maximise the European lobbying power of authorities with (what they perceive to be) common territorial interests and/or identities; and, at the same time, they are often favoured by an emergent European state as it seeks to promote a Europe of the regions in which the power of national states may be reduced. These partnerships, initiatives, networks and lobbying agencies demonstrate the range of alternative resources for economic development which can be deployed by local authorities seeking access to European economic dynamics by consciously by-passing the national state. Nonetheless it remains to see how significant is their real impact on economic development and rank in the emerging European city hierarchy as opposed to their role in place marketing. One side-effect has been far greater trans-national policy transfer.

IV.3. The Search for Growth: The Resource Procurement Model

Resource procurement characterizes economic development in many inner-metropolitan authorities (cf. Malpass 1994; Martin 1995: 207-8; Randall 1995). This is an understandable response to a lack of land for property development schemes, large areas of urban deprivation and poor housing, a weak fiscal base, and political and institutional fragmentation which makes co-ordinated growth strategies more difficult. In addition to the traditional source of ‘procurable assets’ in the central state, local authorities can now access European Union funds, especially Structural Funds. The problem of metropolitan and regional fragmentation emerges here too, however, because the EU often requires regional submissions. This advantages those member states (unlike Britain) with regional tiers of government and/or regional development agencies. Where both exist, as in Scotland and Wales, bids for European funding seem more successful. In England, where both are lacking, energetic lobbying has occurred to get the EC/EU to extend the eligibility criteria for European Regional Development Funding — in particular to include partnerships between local authorities (Benington 1994: 29).

Successful bids under a resource procurement strategy typically come with strings attached. This constrains the range of economic initiatives that can be pursued and threatens the coherence of an overall economic development plan (Hay 1994). Thus urban authorities appear to face an unenviable choice: opting for ideological integrity and maximum autonomy regarding disposition of limited (and diminishing) resources or plumping for compromise and limited autonomy over a significant resource base. However, since the EU monitors expenditure less closely than the Department of Trade and Industry or the Department of the Environment, there are probably fewer strings tied to EU funding — and even these often have a juster, less neo-liberal bias. An additional problem is, of course, that ‘prestige economic development’ initiatives may have little resonance or benefit for inner city residents. This can threaten the legitimacy and electability of Labour-controlled inner metropolitan areas whose economic development strategies tend to result in jobs for commuters and entertainment for the suburban middle-class.

IV.4 Place Marketing: Local Regulatory Undercutting and International ‘Beauty Contests’

Place marketing has become more central to cities, with increasing budgets set aside for image construction and advertising (Hall and Hubbard 1996: 161). Sometimes this involves little more than a search for electoral and political legitimacy by identifying local notables with flagship projects. But such boosterism can also play a role in developing economic confidence and/or attracting inward investment from within or beyond national borders. Indeed Wilson considers such city marketing the most common form of economic development strategy. This often takes the form of re-imaging or re-inventing the city by emphasizing the uniqueness of local traditions, local heritage, local ethnic or cultural differences, etc., in a sanitised, marketable way (Wilson 1995: 648). This can lead to the paradoxical result, however, that local identity scripts often have a uniform appearance (Cox and Mair 1991).

One target group for such place-marketing is mobile international capital. In this sense the strategy may by-pass not only the national, but also the European, state; and focus on attracting North American, East Asian, and other foreign direct investment. This is particularly common in the North East and West Midlands but occurs throughout the United Kingdom. Among many ‘success’ stories are the attraction of Nissan to Washington near Sunderland, Toyota to Derby, Samsung to Cleveland, and most recently Siemens to the Hadrian Business Park overlooking the Swan Hunter shipbuilding yard on North Tyneside. These companies are attracted by the prospect of assembling products within the otherwise relatively protected Single European Market (Bachtler and Clement 1991; Collis and Noon 1994), and by the absence of significant degrees of labour-market regulation found elsewhere in Europe — reflected in correspondingly ‘competitive’ labour costs (Sadler 1992: 129).

Local authorities and local partnerships are often aided and abetted in this regard by the central state. High profile projects in particular tend to be highly dependent upon national assistance through regional financial incentives such as Regional Selective Assistance, infrastructure investment, and so forth (Sadler 1992). Local authority strategy often involves local ‘context-shaping’, i.e., attempts to restructure key local relationships to attract FDI to a given site. In this regard local economies tend to compete in terms of their comparative labour-market deregulation, sacrificing workers’ rights in return for the prospect of potential local reductions in (the rate of growth of) unemployment. Such regulatory undercutting is a counter-productive strategy for generating jobs in areas of economic decline but one that is nonetheless favoured by European integration and, until recently, Tory opposition to the Social Chapter (which appears in key respects to be maintained even under New Labour with its rather neo-liberal reading of workfare).

V. Conclusions

There is no quick and easy recipe for a successful entrepreneurial city. Most urban entrepreneurial projects which involve more than property-led regeneration fail and even the latter are prone to speculative boom and bust. The scope for successful mobility is largely limited to cities in the middle of the urban hierarchy, with dominant cities exploiting their past success and low-ranking cities mostly trapped at the bottom. In any entrepreneurial race, moreover, there are necessarily losers as well as winners. Even middle-ranking European cities with a well-developed entrepreneurial orientation (such as Dublin or Barcelona) may not succeed if they are few opportunities for economic expansion. Indeed, centre-periphery relations and urban hierarchies seem remarkably stable in this regard with the possibilities of movement being largely confined to intermediate regions and depending on patient, long-term strategies (Krätke 1995; Parkinson and Harding 1995; Steinle 1992).[16]

In addition, entrepreneurial strategies are subject to at least four sets of constraints: first, there are the growth dynamics and resulting structural contradictions at the heart of any capitalist economy; second, there are the strategic dilemmas which not only beset any choice of entrepreneurial strategy but also extend to the need to balance entrepreneurial goals and economic growth more generally against other desiderata (social inclusion, democratic participation, accountability, etc.) which are often excluded from economic calculation; third, given the multiplicity of relevant scales of economic activity and the absence of any one dominant level as compared to the Atlantic Fordist period, issues arise about how best to articulate the urban level with other scales of innovation to increase the chances of successful projects; and, fourth, there are limits associated with the insertion of entrepreneurial activities into the broader structures and activities of the state.

Among the many structural contradictions of capitalism, two are especially significant for local economic strategies: first, that between productive capital as mobile capital in flow and as concrete capital in the process of valorization; and, second, that between wages as a cost of production and as a source of demand. The first involves dilemmas around producing place and capturing flows in space. ‘Strong competition’ typically involves a search for ways to overcome this dilemma by linking the two processes so that (re-)territorialization tendencies dominate over those of de-territorialization. But ‘soft competition’ is more concerned with the search to capture mobile factors of production and is therefore more prone to promote a ‘zero-sum’ competition between cities, switching mobile investments around in Ricardian competition without expanding them. The second contradiction creates dilemmas around regulatory undercutting in the attempt to reduce wage costs regarded as a national (and increasingly international) cost of production and the attempt to create endogenous demand within the urban economy so that it is less dependent on an uncertain export demand. Both contradictions illustrate a more general feature of entrepreneurialism, especially in its neo-liberal form. For it is far from socially neutral in its implications. It typically transfers resources and power: from localities to firms, from local collective consumption to investment, and from immobile to mobile firms (cf. Harvey 1989). Even when it is embedded in more neo-statist or neo-corporatist contexts, however, entrepreneurialism encounters difficulties. For the more successful are entrepreneurial activities, the more this entrenches the need for permanent innovation. This is the basis for recent claims about the dynamism of the global city, the informational city, or the ‘reflexive city’.

Secondly, the dilemmas affecting urban entrepreneurial strategies include: striking a balance between cooperation and competition (both in and among cities); between imitation (of existing best practice) and innovation (the search for new and better practices); and between measures to secure the survival of individual firms and to maximize the overall vitality of an economic space.[17]

Thirdly, issues of scale also pose dilemmas. For the multi-tiered governance of entrepreneurial policies has contrasting horizontal and vertical aspects: whilst there is heterarchic (self-organizing) cooperation on any given level, there is a greater tendency for hierarchy to be retained in the coordination of governance across tiers. As Collinge and Hall note: ‘relations within the state system between tiers are hierarchical, and largely political, administrative or fiscal in character; networks between tiers therefore reflect these characteristics. Relations within tiers, however, are horizontal and cooperative — or increasingly — competitive, and networks are therefore constrained by the balance between these two’ (1995: 20). This creates contradictory pressures. Sometimes competition at lower levels may need to be suspended to secure higher level resources from the state (e.g., in bidding for Single Regeneration Budget funding within micro-economic spaces or for EU funding for broader-based urban, regional, or trans-local projects) or from mobile international capital (e.g., by offering a single union policy, cooperation between private and public sectors, or between urban and county authorities). But sometimes cities may engage in political and institutional collaboration in the search for common solutions to common problems (cf. Harding 1995: 55).

Fourthly, urban entrepreneurship is limited by the contingent insertion of its particular organizations, institutions, and activities into the state system more generally — a system which is itself tending to become more multi-tiered, de-centred, and complex but within which the national state retains a key intermediating role. Urban entrepreneurship depends on a range of flanking and supporting measures of both a material and symbolic nature taken by the state; on complementary temporal horizons; on the avoidance of unnecessary duplication or counteraction by other coordination mechanisms. Moreover, although various entrepreneurial mechanisms may acquire specific techno-economic, political, and/or ideological functions, the local state and, even more, the central state typically monitor their effects on state capacities to secure social cohesion in divided societies. The state keeps to itself the right to open, close, juggle, and re-articulate urban governance arrangements not only in terms of particular functions but also in terms of their implications for partisan and overall political advantage. This may explain why entrepreneurial urban and regional development is often not as significant as entrepreneurial narratives might suggest: it is hard for governments to break with inherited commitments to territorial fairness and national equity and to live with the redistributional effects of entrepreneurialism (cf. Harding 1995: 44).

Finally, I want to end by noting that there could be alternatives to the dominant pattern of capitalist entrepreneurialism in cities. These would involve promoting the enterprise society rather than a bourgeois enterprise culture; the focus would be on personal and community enabling and empowerment rather than private enterprise and private profit; and on the learning region rather than the entrepreneurial city. If enterprise involves new combinations, then perhaps it is time to emphasise innovation that maximises human capacities rather than private profit.

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Endnotes


[1] This chapter derives from research funded by the Economic and Social Research Council in its Local Governance Programme, Research Grant L311253032. I wrote it whilst Hallsworth Fellow in the School of Geography at Manchester University. I am grateful to Adam Holden, Martin Jones, Jamie Peck, Steve Quilley, and Adam Tickell for discussion at Manchester; and to Alan Harding for inspiration in other contexts. Parts IV of the paper draw extensively on joint work with Colin Hay. The usual disclaimers apply.

[2] The present paper complements one more directly focused on narrative aspects of the ‘entrepreneurial city’ (Jessop 1997b). The latter explores: the re-imaging of local economies and states through discourses about the ‘entrepreneurial city’; the implications of this re-imaging for the re-design of urban governance; links between these changes and the complex spatial re-articulation of the ‘global economy’ and an emerging primacy of geo-economics over geo-politics; and the general context of these interconnected urban changes.

[3] I have in mind here interpersonal networking, inter-organizational negotiation and coordination, and inter-systemic partnerships bringing together representatives of different but interdependent institutional orders. See Jessop 1997c.

[4]  For a discussion of the 1980s concept of structural competitiveness and its dimensions, see Jessop et al., 1993; and, on the more recent concept of systemic competitiveness, see Esser et al., 1996, and Messner 1996.

[5]  These terms are defined in Jessop 1982: 245-255.

[6] Different theories of international competitiveness are often linked to different typologies and disputes about the bases of competitive advantage. But different types of advantage may also prove complementary in practice.

[7] The Ricardian discourse with which this concept is linked tends to treat factors as ‘natural’ which are in fact heavily dependent on broader social conditions: an abundance of cheap wage-labour is only the most obvious such example.

[8] ‘The classical theory of comparative advantage rested on some seriously simplified assumptions: international market prices were assumed to be known and stable; there was no uncertainty about the prices that would be obtained for export products, or paid for imports; there was no learning-by-doing; technology was known; constant returns to scale prevailed; resources were all fully employed; and the characteristics of commodities were fixed and known to everyone’ (Warr 1994: 4).

[9] For example, in his famous article on the shift from urban managerialism to urban entrepreneurialism, Harvey tends to equate entrepreneurship and speculation (Harvey 1989). Routine risk-taking in property speculation is better understood as a form of deal-making rather than entrepreneurship in a Schumpeterian sense.

[10] This suggests that, when private capital enters into partnership with the state (at whatever level) and the latter bears a significant share of the economic risks, the state is acting as a capitalist as much as (if not more than) an entrepreneur. Much of what passes today as the actions of the so-called entrepreneurial city is risk-bearing for private capital. As Harvey notes, a key feature of risk-absorption in the current period of capital accumulation is the major role of the local (as opposed to national) public sector in this regard. Thus the present phase of urban entrepreneurialism is distinct from earlier phases of civic boosterism in which private capital seemed generally much less risk averse (1989: 7).

[11] Notwithstanding the comment in footnote 9 above, the following list is inspired in part by Harvey 1989: 9-10.

[12] Indeed, if there is an excess of speculative imitation, the resulting oversupply could reduce profits below normal levels.

[13] Hall and Hubbard argue that the discourse of the entrepreneurial city reflects this in so far as it stresses the individual, contingent, and particular character of locality, whereas the global is seen as abstract, social, and general (1996: 160). This may well be true as a description of discourses; but it is misleading as a description of global processes in all their unstructured and unstructurable complexity.

[14] The real economy is so unstructured and complex in its operation that it cannot be an object of management, governance, or guidance.

[15] But there is no escape for cities as opposed to firms from its regulation; nor from the institutional and political constraints it imposes.

[16] Thus Rubinstein notes in his study of individual entrepreneurs in the nineteenth century, it was important for them to be in the right place at the right time. For ‘both degrees of entrepreneurial success and the areas or fields in which entrepreneurial success are most likely to occur are virtually predetermined by the underlying structure of that society‘ (1983: 21, emphasis in original).

[17] Hence the paradox that ‘the short life cycle of many high-technology firms may be helpful for sustaining the long-term innovative capability of an ecosystem such as Silicon Valley. In addition to maintaining the stream of new firms, which in turn provide employment opportunities and create new products and services, ephemeral firms increase the variety of experiments — and, when acquired, they can help rejuvenate other entities or become reconfigured in the form of new entities’ (Bahrami and Evans 1995: 85).

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