The foundational economy and regional development

ABSTRACT

The foundational economy approach to economic development suggests that the production of goods and services that are critical to human welfare (e.g., water, energy, education and elderly care) should be the central concern for policymaking. This paper examines whether this approach could address three core challenges for regional development: social polarization, interregional inequality and environmental sustainability. It concludes that the foundational economy approach is particularly promising in addressing challenges relating to social polarization, but could benefit from further engagement with alternative theories on innovation, work in political science on policy for improving government quality, and various literatures on environmental sustainability.

KEYWORDS:

• foundational economy
• regional development
• policy
• social polarization
• regional inequality
• environmental sustainability

JEL:

• O10
• O20
• R58

ACKNOWLEDGEMENTS

The author gratefully acknowledges comments by Kristin Gulbrandsen, Birgitte Nygaard, Madeleine Wahlund and the participants at the GeoInno 2020 conference, University of Stavanger, and the 2020 WISERD Foundational Economy Online Series, Cardiff University.

DISCLOSURE STATEMENT

No potential conflict of interest was reported by the author.

Notes

1. Previous research highlights the fact that formal decentralization may be insufficient to implement novel approaches in governing foundational services due to the complexity of, for example, energy supply in less developed as well as metropolitan regions (Madsen & Hansen, 2019; Turnheim et al., 2018).

2. Recycling and waste handling is strikingly absent in accounts of the foundational economy (Bentham et al., 2013; Foundational Economy Collective, 2018), even if the service arguably fulfils all criteria for being considered foundational.

Additional information

Funding

This work was funded through the projects ‘GONST – Where does the Green Economy Grow? The Geography of Nordic Sustainability Transitions’ [grant number 83130], financed by NordForsk, Nordic Innovation and Nordic Energy Research; ‘GREENMIX – Green Growth Policy Mixes’ [grant number 97329], financed by NordForsk and Nordic Energy Research; and ‘STIPP – Swedish Transformative Innovation Policy Platform’ financed by Vinnova.