The promises and pitfalls of operationalizing inclusive growth

ABSTRACT

Inclusive growth is a resurgent concern for policymakers, raising questions about what economic development is for and the outcomes to be prioritized. This paper contributes to the literature by examining the opportunities and challenges emerging from attempts to operationalize inclusive growth in four regional contexts in Scotland. We show that applying inclusive growth ultimately rests on complex factors, from local leadership and autonomy through to the guidance and analytical support provided by other orders of government. Implementing inclusive growth hinges, indeed, on securing incremental, practical change that is attentive to varied regional challenges.

KEYWORDS:

• inclusive growth
• policy agendas
• well-being
• local government

JEL:

• R58

INTRODUCTION

Inclusive growth reflects a concern for the socio-economic consequences of economic growth and change, and is a term widely adopted by policymakers (Lee, 2019; Organisation for Economic Co-operation and Development (OECD), 2018; Sissons et al., 2019). Receiving heightened emphasis following the financial crisis, debates are ongoing about what steps can support wider participation in economic production and how the beneficiaries from economic processes can be expanded. The spectrum of debate here is vast, from those who argue that growth is an obsession that needs to be reined in – and some here push for an inclusive economy rather than inclusive growth – to those who see opportunities to adjust existing growth approaches to serve wider constituencies (Beatty et al., 2019). At the same time, inclusive growth debates have advanced in an aspatial manner. This leaves open questions as to whether inclusive growth applies to interregional inequalities – a concern for places ‘that don’t matter’ (Dijkstra et al., 2020; Rodríguez-Pose, 2018) and ‘spatial rebalancing’ (Martin, 2015) – or for inequalities within cities and regions (Bailey & Minton, 2018; Hughes & Lupton, 2021; Lupton et al., 2019).

Prompted by many of the questions and uncertainties presented, an emerging academic literature is developing alongside the burgeoning policy interest in inclusive growth (Lee, 2019; Sissons et al., 2019; Waite et al., 2020). Of interest here is the extent to which inclusive growth is, or can be, seen as a distinct approach to economic development. Lee (2019) points to the antecedents provided by pro-poor growth; however, other contenders – such as ‘inclusive development’ (Pouw & Gupta, 2017) – also warrant attention. A further debate concerning the differences between economic growth and economic development is instructive to recall (Feldman & Storper, 2018). Here economic growth has a narrow scope, typically around a concern for gross value added (GVA) measurement (Stiglitz et al., 2009), whilst economic development looks to the capabilities of communities to realize different futures thereby giving scope to retain a distributional concern (Hughes & Lupton, 2021). Related literatures that have considered the ‘double crises’ facing regions (Donald & Gray, 2019), strategies for linking ‘growth with equity’ (Chapple, 2018, and a suggested ‘normative turn’ in innovation policy (Uyarra et al., 2019), offer further parallels to the concept of inclusive growth.

Leaving aside prior renditions of the idea, a notable challenge with inclusive growth is implementing it in local contexts (Lee, 2019). Indeed, one of the core issues noted by Lee (2019, p. 429) was that:

there are problems both with the concept of Inclusive Growth and its practical application. In particular, its fuzziness makes it hard to operationalize; it remains unclear what works in achieving it; and it reflects an overconfidence in the ability of subnational governments to shape their local economies.

This paper responds to this gap by interrogating application approaches in regional contexts within Scotland over a five-year period. The paper reports what policymakers say about the policy application challenge and presents evidence about whether inclusive growth has led to practical change, including what has progressed and what has not. In doing this, we seek to move past the quest for definitional sufficiency which marks a number of policy outputs.

The research question that this paper addresses is: How have local policymakers in Scotland understood inclusive growth and what opportunities and barriers have they faced in implementing an inclusive growth approach? Through this question, with its focus on operationalizing inclusive growth, we develop a series of organizing categories from the data – ‘framings’, ‘practices’ and ‘politics’ – which, we argue, sits behind operationality. The approach taken in the paper enables us to provide reflections on Lee’s (2019, p. 428) more general assessment that inclusive growth appears in ‘current politics’ as a ‘concept’ (framework), ‘agenda’ (shared interests) or ‘buzzword’ (brand). We show that each of Lee’s terms can be observed through attempts to operationalize inclusive growth in Scotland. Notably, while we share the term ‘agenda’ with Lee, our use is explicitly focused on the manner in which inclusive growth is operationalized in local case settings (through a national–local relationship) vis-à-vis a more general concern for how inclusive growth appears in broader political settings.

The Scottish concern for inclusive growth has already been presented in the literature (Houston et al., 2021; Waite et al., 2020). However, this paper differs and contributes to the literature more widely due to: its cross-case study design; and by bringing in direct insights from senior policymakers who have actively sought to work with and apply inclusive growth. Building on Lee’s (2019, p. 425) concern that inclusive growth has been ‘enthusiastically but uncritically adopted’, this paper has wider significance in that a persistent challenge with inclusive growth is designing practical policy responses (see also OECD, 2017, 2018; and Asian Development Bank – ADB, 2014). In this respect, how does inclusive growth lead (or not) to the prioritization and design of policy in particular ways? In showing the roles of: inter-governmental relationships and feedback processes; analytical tools; the prominence (or not) of local political leaders; and the emergence of related progressive agendas, lines of sight to other national and regional contexts are presented (OECD, 2017). In doing this, we also point out the uneven capacities of local bodies to operationalize inclusive growth, as shaped by fiscal retrenchment (Peck, 2012).

RESEARCH FOCUS, METHODS AND THE SCOTTISH CONTEXT

Scotland is an interesting context given the emphases placed on inclusive growth by the Scottish government, and the diverse challenges that face its regional (and local) economies. To address the research question from a varied range of perspectives, we look at four quite different subnational contexts within Scotland, all of which bear some similarities to regions across Europe. Edinburgh (Scotland’s capital) is a dynamic economy with a vibrant services sector but a growing gap between rich and poor with pressure on local infrastructure from a rapidly growing population; Glasgow is a large post-industrial city which exhibited population and relative economic decline through to the mid-2000s (child poverty rates were as high as 41% in some neighbourhoods, compared with a Scotland-wide figure of 26%; GCPH, n.d.); Aberdeen has for decades proclaimed to be the energy capital of Europe, but now faces major restructuring challenges (as oil and gas enter their twilight years); and North Ayrshire is a locality, without a major urban area, that has struggled to attract investment and jobs. Evidencing these differences, Table 1 shows data for the four case studies, highlighting the divide in economic outcomes. This shows that employment rates across the cases vary from Aberdeen’s relatively high rate to North Ayrshire’s low rate (though all cases at the time are below the Scottish average), whilst data on labour productivity shows Edinburgh’s strong performance versus Glasgow and North Ayrshire’s relatively weaker performance.

Table 1. Case study economic profiles.

	GDP per head, 2019^a	Gross household income per head, 2018^b	Unemployment (% 16+), October 2019–September 2020^c	Employment (% 16–64), October 2019–September 2020^c	Inactivity (% 16–64), October 2019–September 2020^c	Productivity, 2019 (UK = 100)^d
Aberdeen	£48,225	£21,139	3.5%	73.8%	22.8%	97.8
Edinburgh	£48,714	£23,374	3.0%	73.2%	24.0%	119.2
Glasgow	£37,965	£17,145	5.5%	67.1%	30.1%	88.6
North Ayrshire	£19,766	£17,038	5.7%	69.0%	27.3%	92.5
Scotland	£29,920	£19,572	3.5%	75.7%	23.5%	97.9

Note: ^aRegional gross domestic product (GDP), Office for National Statistics (ONS) – local authority areas: https://www.ons.gov.uk/economy/grossdomesticproductgdp/datasets/regionalgrossdomesticproductlocalauthorities; and https://www.ons.gov.uk/economy/grossdomesticproductgdp/datasets/regionalgrossdomesticproductallnutslevelregions (for Scotland) (both accessed on 1 March 2022).

^b Household income, ONS – local authority areas: https://www.ons.gov.uk/economy/regionalaccounts/grossdisposablehouseholdincome/datasets/regionalgrossdisposablehouseholdincomegdhi; and https://www.ons.gov.uk/economy/regionalaccounts/grossdisposablehouseholdincome/datasets/regionalgrossdisposablehouseholdincomegdhi (for Scotland) (both accessed on 1 March 2022).

^c Nomis/ONS-Annual Population Survey – local authority areas.

^d Local authority labour productivity (gross value added (GVA) per hour worked), ONS: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/datasets/subregionalproductivitylabourproductivityindicesbylocalauthoritydistrict; and https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/datasets/subregionalproductivitylabourproductivitygvaperhourworkedandgvaperfilledjobindicesbyuknuts2andnuts3subregions (for Scotland) (both accessed on 1 March 2022).

The maps in Appendix A in the supplemental data online show the intra-locality divides using the Scottish index of multiple deprivation (SIMD). The SIMD is formed from more than 30 indicators of deprivation for 6976 small area datazones across Scotland (approximately 700 people per datazone).¹ The territorial scope of each datazone represents relative population size per local area (e.g., the larger datazone areas in North Ayrshire reflect its rural environment). In terms of the share of the 20% most deprived datazones in Scotland, 44% of Glasgow’s datazones are in this category, whilst for North Ayrshire the same category accounts for 40% of the area’s datazones. In contrast, 12% of Edinburgh’s datazones and 10% of Aberdeen’s sit within Scotland’s 20% most deprived datazones (Scottish Government, 2020, p. 10).

What is clear, therefore, is that large economic differences exist across and within the case contexts. This has led to differences in local interpretation of the inclusive growth problem. In Edinburgh, which exhibited strong growth in recent years, it is unsurprising that a key reflection of policymakers has been the need to ensure that the benefits of this growth are shared more equally between the ‘haves’ and the ‘have nots’ (City of Edinburgh Council, 2018). A similar challenge had been evident in Aberdeen with its booming energy sector, but the city faces an uncertain future having lost over 25,000 jobs from the region since 2014 (the biggest fall of any UK region; ONS, 2021). As a result, the policy focus has shifted to resilience and diversification in recent years (Aberdeen City Council, 2020a). In Glasgow, economic development continues to wrestle with an ‘old’ problem of how to re-invigorate a past industrial giant (Kintrea & Madgin, 2020). Whilst for North Ayrshire, the goal has been to build from the bottom up an economic model focused upon local value and sustainable employment (North Ayrshire Council, 2020).

This paper hinges on a multi-method research approach. To reveal how policymakers have approached inclusive growth – and to detail their reflections on how inclusive growth is being operationalized – our data collection is principally based on semi-structured interviews (undertaken by online conferencing). Eleven interviews were undertaken, engaging 15 persons and covering all major organizations involved in the implementation and delivery of inclusive growth. The interviewees were selected from the researchers’ existing understanding of local contexts, and all interviewees held senior leadership positions. All interviewees had been in post for a substantial period of time, so were able to give a comprehensive view on policy evolution and change. Some interviewees held roles in local public bodies, whilst others were in national government (Scottish and UK), national enterprise and skills agencies, and UK-wide think tanks (where pertinent views on the evolution of inclusive growth approaches could be gleaned). Questions were asked about relationships with neighbouring local authorities where city-region policy approaches are relevant. Scope was given for snowballing to occur, where interviewees pointed to other interlocutors who could provide insights. Appendix B in the supplemental data online lists the interviewees approached (with appropriate anonymisation). Each interview lasted around 60 minutes and permission was obtained for recording.

This research approach enabled rich reflections on what has operationally worked well and less well, and the semi-structured interviews permitted novel and surprising insights to emerge. Ahead of each interview, the researchers developed an understanding of the local context. A documentary repository – including local strategy and city/growth deal documents (which, in each of the areas, are notable policy and investment commitments based on UK government and Scottish government funding) – allowed findings from the interviewees to be cross-checked and contextualized. The categories that make up the empirical section were drawn from an analysis of the interview data (after all interviews were conducted). This process was aided through the authors continual dialogue, which involved a follow-up meeting after each interview to reflect on key points, and a further meeting – after all interviewees were conducted – to determine initial categories (which were further refined).

The paper proceeds from here through a presentation of the empirical findings, which are dispersed across three themes. We then present discussion points, drawing out implications for wider scholarship, before offering conclusions.

OPERATIONALIZING THEMES

As a starting point, Table 2 sets out some background for how and in what form inclusive growth has emerged, as presented by local bodies through documentary material, with some of the notable examples also suggested by our interviewees:

Table 2. Approaches to inclusive growth in the case study areas.

	Aberdeen	Edinburgh	Glasgow	North Ayrshire
Broad approach to inclusive growth (noted in strategy documents)	‘inclusive economic growth’^a	‘good growth’^b	‘fair work and regional cohesion’^c	‘inclusive economy’^d and ‘inclusive economic growth’^e
Regional development problem with which inclusive growth interacts	A region, hitherto strong performing, now faced with a sharp process of industrial restructuring (due to oil and gas transition). As a result, inclusive growth is concerned with resilience	A city-region that performs strongly at the aggregate level (in the UK context), but with significant divides in prosperity within it	A large city-region (in the UK context) that is working through the legacies of prior industrial and economic changes	A region that persistently lags Scottish averages across a range of economic development indicators
City/growth deal alignment with inclusive growth	After the Scottish government’s inclusive growth agenda. ‘Inclusive economic growth’ noted as one of the four pillars of the city deal.^a ‘Positive procurement approach’ to deliver benefits to ‘disadvantaged people and local businesses’.^a Skills projects in schools, colleges and universities relating to oil and gas and digital^f	After the Scottish government’s inclusive growth agenda. Inclusive growth framework, comprising five pillars, linked to the city deal. ‘Integrated Regional Employability and Skills Programme’^g	Before the Scottish government’s inclusive growth agenda. Programme minima within the infrastructure programme in the city deal notes impacts on deprived communities were built into project selection.^h Skills and employability projects sit within the city deal^i	After the Scottish government’s inclusive growth agenda. Inclusive growth seen as a core focus of the Ayrshire Growth Deal, and is seen to underpin all projects within the deal. Focus areas – skills, unemployment, weak productivity and health issues^j
Notable example of activities/initiatives with links to inclusive growth	Oil and Gas Technology Centre (OGTC) as part of managing the transition away from fossil fuels	Edinburgh guarantee (youth training/job programme)	City deal community benefits approach (linked to infrastructure spending in the city deal)^k	Employability services and support services concerning personal finances

Sources: ^aAberdeen City Council (2016); ^bCity of Edinburgh Council (2018); ^cGlasgow City Region (2016); ^dNorth Ayrshire Council (2020); ^eUK Government (2020); ^fAberdeen City Council (2020b); ^gUK Government (2018); ^hInverclyde Council (2013); ⁱGlasgow City Region Deal (n.d.); ^jUK Government (2020); and ^kGlasgow City Region (2021).

In what follows, drawing on the interview material, we posit three categories – ‘framings’, ‘practices’ and ‘politics’ – which reflect a core response to the research question on the operational workings of inclusive growth. The three categories, which were derived on completion of the interviews through a process of abstracting core operationalizing themes, are interlinked. They also differ from categories found in aspects of the literature concerning the micro–meso–macro approach; this is because our three data-derived categories cut across all three layers of the micro–meso–macro reflecting our concern for the national–local relations necessary for operationalizing inclusive growth in the Scottish context. In other words, agendas and how they evolve may exhibit macro (national/global) and micro (local) qualities, as may practices. What is key, in the context of this paper, given the research question, is how agendas and practices take form and work across these spatial settings. The subsections that follow present evidence on the cases in focus – centred around the direct operationalizing themes of ‘agendas’ and ‘practices’, and the indirect theme of ‘politics’ – before the following discussion section pulls out more general reflections on operationalization (and the challenges that come with it).

Agendas – framings

The first concern for operationalizing inclusive growth is the overarching or common perspectives that underpin an approach to economic development. Framings also reflect which stakeholders come on board to support an approach, as well as the inviolable characteristics of a certain approach (approach x, needs a, b and c, etc.) (Waite et al., 2020). Agendas may be triggered and pursued at national or global scales (macro) or at more localized settings (micro).

The emergence of the inclusive growth agenda came into prominence in 2015 with the release of the Scottish government’s Economic Strategy (Scottish Government, 2015). Following speeches given by Scotland’s First Minister (in late 2014), ‘inclusive growth’ featured amongst the four ‘I’s of ‘internationalisation’, ‘innovation’ and ‘investment’. This underpinned a balance between ‘competitiveness’, on the one hand, and ‘tackling inequality’, on the other (Scottish Government, 2015, p. 8). The Scottish government defines inclusive growth as ‘growth that combines increased prosperity with greater equality, creates opportunities for all, and distributes the benefits of increased prosperity fairly’ (Scottish Government, n.d.). Whilst seen by Lee (2019, p. 427) as one of the ‘sharpest’, it may also be fair to reflect that this opens up a wide breadth of policymaking (interviewee 3). For some, a lack of uniformity in definitions presents a ‘risk’; however, it also ‘allows you to enter into discussions with people about growth … and get in the poverty and inequality points in discussions about economic development and business policy’ (interviewee 4).

At this point, in 2015, inclusive growth can be best regarded – drawing on Lee’s (2019) schema – as a ‘buzzword’ looking for an ‘agenda’. A national agenda evolved from this point, however, and was developed through a number of events and initiatives. Here we can point, in particular, to: an international inclusive growth conference held in Glasgow in 2017; reports from the Enterprise and Skills review (Scottish Government, 2017) – an independent review of national enterprise and skills agencies – which sought to recast arrangements for economic development in Scotland; and national developments around fair work.

Interviewees noted that an awareness of the Scottish government’s attachment to inclusive growth became strongly apparent from 2015. For one Glasgow interviewee there was a sense of the ‘boot is on top of you’, in the first instance, with a need to show how they (the locality) were embracing inclusive growth; however, there is now ‘less of a sense of them marking your homework’ (interviewee 5). For a respondent from Aberdeen, however, changes in the local economy – which have sharpened concerns for inequality and unemployment – was the key driver for engagement with the inclusive growth agenda (interviewee 6). Others were more sceptical, pointing to a sense of rhetorical force in the agenda but lack of a practical outlet – ‘[the Scottish government] talk about it … but struggle to say what they are going to do’ (interviewee 9).

An interesting touch point in operationalizing this agenda has been the evolution of city and growth deals. For the cases examined, three regions agreed deals broadly after the Scottish government’s strategy emphasized inclusive growth (North Ayrshire, Aberdeen and Edinburgh) and one signed a deal before (Glasgow). For those deals signed before or shortly after the strategy emphasis was made apparent, some mentioned a need to ‘retrofit’ inclusive growth into city deal thinking (interviewee 6). For those deals coming later, agreeing a deal would require some alignment to the inclusive growth agenda (as required by the Scottish government’s Enterprise and Skills Review; Scottish Government, 2017); as an Edinburgh interviewee remarked: ‘we met with SG [Scottish government] officials to gauge what they were looking for … [that] helped to give confidence around thinking’ (interviewee 11).

The engagement of national government agencies in embracing inclusive growth has however, varied over time. Some respondents claim that they have been doing inclusive growth since they were set up (interviewee 13 and 14) (with concerns over retrospective labelling). How the inclusive growth agenda has evolved has also hinged, for some, on how national government perceives the role of local government in economic development. One interviewee remarked that ‘national government had little appreciation of local government in economic development’, and suggested that in some cases local policymakers ‘knew their economy better than national government did’ (interviewee 12). Others, taking a wider UK perspective, noted that ‘local decision making is really critical’ and appealed for a ‘more mature relationship’ between different tiers of government (interviewee 15).

Interestingly, despite the steps made to operationalize inclusive growth in Scotland and regions within it, recent developments raise questions about whether, and on what terms, the inclusive growth agenda will endure. First, inclusive growth now appears less in policy documentation than before – and in some places is qualified by ‘sustainable, inclusive economic growth’ (Scottish Enterprise, 2019, p. 8) or aims for an ‘inclusive net zero economy’ (Infrastructure Commission for Scotland, 2020, p. 6). Second ‘well-being’ is increasingly a key policy rubric of the Scottish government (Advisory Group on Economic Recovery, 2020) and reflects a broadening of the scope of economic development policy (to include, perhaps, wider social and ecological concerns). This shift in nomenclature was not missed by interviewees, who variously questioned what the term means (interviewees 5 and 10). One interviewee spoke of the lack of clarity: ‘where is the approach to the wellbeing economy written down?’ (interviewee 12).²

This concern for well-being brings to the surface debates about the role of growth within economic development, with the ‘inclusive economy’ providing greater affinity for some (interviewees 3, 9 and 10), whilst others suggested well-being goes too far and risks diluting economic development concerns (interviewee 15). Taking a position on this issue, Burch and McInroy (2018, p. 2) – the latter of whom held an advisory role with the Scottish government³ – remark:

Inclusive Growth is about what happens once we have growth, no matter how unfairly it is created, or the narrowness of those involved in creating it. It is not progressive. … Inclusive Growth is rapidly becoming a mere smokescreen, a get out phrase for the same old market liberalism, with its inbuilt social and economic injustices. … By contrast, an Inclusive Economy offers a genuine progressive conceptual frame in which greater consideration is given to social benefits that flow from, and feed into, economic activity.

Other interviewees, giving a nod to the politics that come with agenda attachment, suggested the terminology used reflects who you want to be ‘aligned with’ (interviewee 4), and Scotland’s role within the Wellbeing Economy Alliance appears relevant here. A related consideration is the manner in which businesses are enrolled in policy agendas. Here the shift to well-being is seen to be problematic for some; while growth enables a conversation to take place – allowing inclusivity and sustainability concerns to come through – well-being may close the door on this, some argue (interviewee 4).

At the same time as well-being might seemingly overtake inclusive growth, in terms of rhetoric at the Scottish government level, the interests of the UK government and new pronouncements around ‘levelling up’, are raising questions on matters of distinction with inclusive growth (HM Treasury, 2021). For some, levelling up is the ‘same thing’ as inclusive growth, and the point was made that often politicians of different stripes want essentially the same outcomes (interviewee 2).

How an agenda is progressed, and how it waxes and wanes alongside concerns for other progressive labels, hinges on how the agenda is put into effect and who has responsibility for the agenda. These issues are discussed in terms of practices and politics below.

Practices – doings

A key consideration for the operationalization of inclusive growth is the subsequent practices and tools used by policymakers. That is, what analytical tools, prioritization tools and specific interventions are deployed by policymakers to meet the inclusive growth vision? Here we consider what policymakers are doing, and how that differs from prior practices. As detailed below, some areas of policy change can be pointed to. Practices may be led by national or global bodies acting at a more macro-level, or by local authorities acting at more micro-spatial settings.

Given our focus, the first place to start is with the Scottish government’s development of an inclusive growth diagnostic – an analytical tool and framework developed to underpin inclusive growth policies in Scotland – with North Ayrshire as a pilot. The aim of this nationally conceived practice was to provide an evidenced set of steps, based upon local statistics and intelligence, to support policy prioritization. The diagnostic was developed by economists in the Scottish government and made available to local policymakers. It is now published on the Scottish government’s Scottish Centre for Regional Inclusive Growth (SCRIG) website.⁴ The diagnostic reflects a Scottish version of a long list of analytical approaches that seek to present metrics for inclusive growth. For example, in the UK, the Inclusive Growth Commission (2017) and Joseph Rowntree Foundation’s (JRF) inclusive growth monitor (Beatty et al., 2016) sought to specify measurement approaches, whilst, globally, the OECD have provided insights (Boarini et al., 2015).

Respondents offered varying views on how successful the diagnostic tool had been. For some, it enabled a sharpening of priorities based on data (interviewee 10); however, others pointed to subjectivity in how priorities were arrived at (interviewees 5 and 9), with some decisions described as ‘guesswork’ (interviewee 10). In short, prioritization through the diagnostic was seen as promising, but imperfect and prone to contestation. Another observation was that the initial enthusiasm of seeing a new analytical tool waned over time as ambiguities in application emerged (interviewee 5). Others said that national guidance on the diagnostic has not ‘been clear’ (interviewee 11). One interview further remarked that it was assumed the ‘diagnostic was a major new tool … now you don’t hear of it … ’ (interviewee 12).

Moving from new analytical framework to new interventions, we can initially look to those practices that have stopped and those that have started. In general, we did find evidence of practical changes in policy, although these have been marginal to date.

An issue several interviewees alighted on was the notion that inclusive growth had reinforced a new approach to attracting external investment. That is, following the great recession, there was a sense that any investment, providing it brought jobs, was good for a regional economy (interviewee 11). Now the view, interviewees suggested, has morphed into a much more practical concern for the quality of investment and the jobs that come with it (interviewee 10). As one interviewee remarked, ‘the number of jobs paying the living wage’ is now the core concern, with funding support explicitly tied to metrics linked to this outcome (interviewee 8).

For some, inclusive growth has opened-up windows through which local concerns can be better articulated and addressed. Indeed, some respondents reported that inclusive growth provided a ‘platform’ to connect to other regional policymaking areas beyond economic development, including procurement, housing, health and personal debt issues (such as through the Better Off North Ayrshire pilot) (interviewees 9 and 10). In the Aberdeen context, the desire to link economic development with schools and education policy was noted (interviewee 6). The idea that inclusive growth needs an allied approach to put it into effect was pointed to by some, and Community Wealth Building (CWB) – which broadly focuses on assets and procurement within a local economy – has been adopted in some localities as a ‘means to achieve a more inclusive economy’ (interviewee 10). Interestingly, one interviewee, discussing initiatives devised in the Edinburgh context, remarked that the key emphasis was checking in with the Scottish government to see if they had any better policy ideas. If they did not, the local partners would continue; ‘It worked for us’, it was remarked (interviewee 11). What we conclude, therefore, is that whilst the Scottish government might have been very forceful in pushing partners to prioritize inclusive growth, what that actually meant in terms of practical steps was that they were either open to local variation (provided that it fitted with the broad objectives of inclusive growth) or that they themselves did not have practical solutions.

One issue is that practices that existed prior to the new uptick of concern for inclusive growth can simply be rebranded, and we do find evidence for this. The Edinburgh Guarantee, which seeks to provide a positive training or labour market destination for school leavers (interviewee 11), and Glasgow’s approach to community benefits realization (e.g., Glasgow City Region, 2021), are two examples of policies that have been in place for some time but are now held up as exemplars of inclusive growth. Similarly, we found repeated acknowledgement that many new policies, which would likely have taken place anyway, have simply been badged as inclusive growth (interviewees 11 and 5).

The disjuncture between local and national practices was a further point identified by interviewees. Some remarked that a challenge in implementing inclusive growth was that it had exposed a lack of understanding, on behalf of national government, of how economic development works practically on the ground, and, crucially, who has the levers to make a difference. This was particularly evident in terms of a perceived lack of a feedback mechanism, in terms of local authorities being able to engage with the Scottish government on what worked well and less well; relating to the application of the diagnostic or on policy solutions more generally (interviewee 10). Indeed, a further backcloth to putting inclusive growth into practice locally, are the limited powers local authorities have at their disposal. In this sense, even if local policymakers could identify an effective inclusive growth policy response, they, in many cases, only have limited scope to respond (interviewee 5).

The practices of inclusive growth are perhaps aptly summarized by a respondent from Aberdeen who noted that we can do more to ‘tidy’ the concept of inclusive growth up for ‘policy and implementation’ (interviewee 6). One interviewee noted that there has been a struggle to move beyond ‘rhetoric’ (interviewee 10), whilst another remarked that ‘inclusive growth tries to be everything to everyone’ (interviewee 5). Other local respondents saw the lack of operational guidance as an opening to do what they wanted to do (interviewee 11). The upshot of this is that inclusive growth has allowed new narratives and conversations to emerge. While some policy shifts at the margins can be pointed to (and these are certainly non-trivial) – and emerging communities of practice have developed (interviewee 3) – there is also a sense of an umbrella approach allowing varying interpretations in policymaking (a point consistent with Lee, 2019).

Politics

Underlying the evolution of inclusive growth in Scotland – both the practices and agendas – are many layers of politics and the interlinkages between different tiers of government. Indeed, politics brings to attention the brittle constitutional backcloth to Scotland’s place in the UK; the individuals who carry agendas forward; and the role of power exercised locally and nationally (and how these interact with each other). In what follows we set out the local–central politics (Clarke & Cochrane, 2013) and the intra-institutional politics that have shaped how inclusive growth has been operationalized.

Starting with the local–central politics, the ongoing constitutional frictions between the Scottish and UK governments – with an independence referendum in 2014 and another being touted by advocates once more – has undoubtedly provided an important backdrop for implementing the agenda (providing a macro-context of sorts). In this case, an obvious domain for policy contestation is created, with one interviewee remarking of the Scottish government’s approach that ‘they want to point to being better’ (interviewee 12) (see also Cairney, 2020). That is, political attempts to differentiate the Scottish agenda from UK agendas are important in understanding the focus on inclusive growth in Scotland, whether or not there was any substance behind it. One example of this, suggested by an interviewee, was the development of the SCRIG, which some have argued is rather cosmetic; this gives the appearance of differentiation in policy and approach, but is in substance a repackaging of existing published evidence with, it would appear, limited new support for policy change (interviewee 12). Another interviewee noted a concern for the ‘presentation argument’ for any policy agenda (interviewee 2), and who is seen to be leading and orchestrating them. Alongside ‘levelling up’, as noted prior, the UK view of regional economic development may also be more firmly established in the development of the ‘Shared Prosperity Fund’, the replacement for European Structural Funds. In these steps, the UK government appears to be signalling a more direct hand in regional economic development in Scotland (interviewees 1 and 2). For some, in summary, constitutional politics ‘clouds everything’ (interviewee 2).

Local–central politics also appears to have played a role in shaping local implementation of inclusive growth approaches. This is particularly apparent given the prominent funding mechanisms, such as city deals, take inputs and funding contributions from both the UK and Scottish governments (Waite & Morgan, 2019). One interviewee remarked, for example, that you ‘play to UK Government and Scottish Government galleries’, and this is pertinent for how economic development approaches are signalled (interviewee 6). One interviewee opined, nevertheless, that the varying affinities to inclusive growth and economic growth may shift if, for example, the Scottish economy underperforms in productivity terms relative to the rest of the UK; agenda politics can change quickly, in essence (interviewee 12).

Shifting local politics is also noteworthy for how the inclusive growth agenda has been embraced. For example, the recent shift to Scottish National Party (SNP) (minority) control of Glasgow City Council may have smoothed the way for the nationally led inclusive growth agenda to take hold locally (as the SNP are the major party nationally). Contestation between local government and national government also hinges on what is expected in terms of guidance to implement inclusive growth (from national–local), and what localities feedback in terms of what is working well and less well (local–national). One interviewee suggested that governance complexity – with a lack of one unit coordinating and driving the inclusive growth focus at a national level – has made it difficult for national government to grasp the challenges of locally operationalizing inclusive growth (interviewee 12).

Institutional politics can also be exhibited, at a more micro-level, in terms of the role played by local leaders in pursuing (or not) inclusive growth. In England, the role of a past leader of Manchester City Council has appeared to be important in terms of a locality shaping and determining subnational policies (interviewees 4 and 5) (see also Haughton et al., 2016). Reflecting on the Scottish context, one interviewee remarked that the ability to embrace and implement inclusive growth hinges on the ‘person … and on the [local] authority’. Another suggested that it was policy officials, working together, rather than political leaders, who shaped policymaking (interviewee 2).

Warranting further reflection is what some have coined the ‘Scottish approach’ to policymaking (Cairney, 2020). This is a suggested approach that hinges on: a ‘consensual style’ with stakeholders; ‘holistic’ government that spans traditional departments; fostering a ‘long-term focus on policy outcomes’; and focusing on ‘assets’ through a ‘co-production’ approach (Cairney, 2020). Our data points to aspects of this ‘Scottish approach’ coming through steps taken to operationalize inclusive growth – such as piloting the inclusive growth diagnostic – but with questions about practical efficacy and translation remaining.

DISCUSSION

This paper set off with a concern for how inclusive growth approaches are being operationalized – mindful of the charge of fuzziness laid against the term (Lee, 2019) – and in the preceding sections we have laid out the evolution of inclusive growth in Scotland. In summary, and recalling Lee’s (2019, p. 5) three-way schema for considering inclusive growth – ‘concept’ (framework), ‘agenda’ (shared interests) or ‘buzzword’ (brand) – we can see these all emerge in regional operationalizing contexts in different ways and at different points. Most obviously, at a Scottish level, an initial buzzword sought to become an agenda, and this agenda was recursively established through the local application of a practice-based framework (the diagnostic).

The story told across the cases is one of both promise and frustration. In terms of the former, the resurgent concern was broadly welcomed for posing new questions and focusing attention on how economic development policies should be prioritized and who should be involved (interviewee 5). For others – and though not a radical ‘rupture’ with past policymaking (interviewee 12) – inclusive growth provided a window to seek to craft an improved balance between growth and distributional concerns. At the same time, however, our data reveal a general story of uncertainty and frustration in terms of how this framing of inclusive growth has ultimately played out in terms of local policy action (and practical policy choices).

Returning to the central research question – can inclusive growth be operationalized? – the data collected from interviewees do show that it is possible to operationalize elements of the inclusive growth agenda. Our analysis points, in particular, to changing ways of attracting external investment and the labour market outcomes sought from this. However, we also need to consider what progress can be observed from a nascent agenda. Indeed, five years is a relatively short period to determine the success (or not) of an ambitious yet fledgling agenda. This connects to points made in the broader literature on time lags in economic development policy (Feldman et al., 2016; Feldman & Storper, 2018).

The evolution of local inclusive growth approaches over the last five years appears to have been contingent on leadership. Our data reveal several facets of this. For example, some claimed that local leaders were important in embracing inclusive growth at an early stage and seeking to apply this approach to local concerns (e.g., North Ayrshire) (interviewee 10). The Scottish government leadership of the agenda, starting with the release of the economic strategy in 2015, was also seen to be crucial for changing emphases on economic development. Now, with challenging constitutional politics at play in Scotland, the role of the UK government in promoting the Levelling Up agenda adds a new dimension, and a potentially competing framework for policymaking.

It would appear to be useful, furthermore, to distinguish the starting points from later attempts at implementation. In this respect, at the initial stages of grappling with an inclusive growth approach there may be a sense that getting partners on board with inclusive growth – even if aspirations are only crudely drawn out – may be key. This is about changing policy sensibilities, through establishing new communities of practice, posing different types of questions about the economy and what is desired from it, and beginning to collect data. Our analysis shows, indeed, that measurement tools can be important in shaping an agenda and building momentum, and we show that the diagnostic developed by the Scottish government had an important role in aiding local officials to reconsider economic development priorities (notably in North Ayrshire). The diagnostic supported new conversations about what economic development is for and helped to kick-start plans to operationalize inclusive growth.⁵ As discussions progress, however, questions emerge about the need for policy guidance. For some, national guidance has fallen short (interviewees 9 and 10), however, for others, the lack of definition has opened up welcome space for locally determined policy actions (interviewees 11 and 4).

Despite some promising steps, several operational complexities can be pointed to. In this respect, advances have tended to concentrate on the low hanging fruit of the inclusive growth agenda, including inward investment, procurement, and fair work. But there are questions about the arguably harder policy work (such as infrastructure policy), where, at a regional level, it is difficult for a number of interventions to identify the ‘nexus’ between growth and inclusion (OECD, 2016). Also, how do we deal with the sometimes contentious politics that are wrapped up in regional policy (e.g., the Scottish government’s decision to locate a social security administration centre, and the jobs that come with it, in Dundee over North Ayrshire; Dunn, 2018)?

The Scottish experience suggests that political attachments to the inclusive growth agenda can vary widely, and the agenda can be used, on the one hand, to showcase a local identity around alternative economic development approaches, while on the other hand, it can be pushed into the long grass (and just lightly noted, as a ‘buzzword’, in policy and strategy documents). The former was most obviously the case for North Ayrshire. North Ayrshire’s adoption of inclusive growth has developed through strategy releases, and is now guided, some claim, by the CWB approach (interviewees 9 and 10). Such local identity can be crucial in securing local support for a policy agenda, particularly in embedding such thinking for the long-term. Offering a contrasting perspective, local bodies in Aberdeen were seen to be late to link into inclusive growth concerns given the general prosperity apparent in the region (and despite persistent pockets of deprivation) (interviewee 6). It is striking, for example, how little explicit reference there is to inclusive growth in the Aberdeen City Deal, compared with the deals for Ayrshire and Edinburgh (it is mentioned only twice in the Aberdeen Deal document). However, new stances to embrace the inclusive growth agenda – ‘it is closer to home now’ (interviewee 6) – relate to the changing fortunes of this regional economy, particularly concerns for industrial diversification given the stark challenges relating to energy transition. In summary, engagement with the nexus of inclusion and growth can be seen to be at different points of progression across Scotland’s regions.

A further issue given our focus on subnational economic development is whether the inclusive growth approach simply provides a veneer that glosses over austerity and funding cuts (Peck, 2012). In other words, despite the progressive intentions, are there sufficient local capacities to work across a range of policy domains? Important to consider here is the decline in revenue, such as day-to-day resource spending, as opposed to capital budgets, and what that means for pursuing an inclusive growth focus (city and growth deals, for example, provide capital but limited or no revenue flexibilities). This has implications for operational capacities. A related consideration is that interviewees presented a story, typically, of local government acting as supplicants to national government. Local authorities have limited capacities and discretions to pursue policy on their own terms (interviewee 11), and – despite, in some instances, local officials appearing to have granular understandings of local economic change processes (interviewee 12) – the story of urban and regional policy in Scotland is one of localities being highly dependent upon higher tiers of government. Furthermore, our four case contexts, and the city and growth deals agreed for them, all point to an incipient city-regionalism contesting a simple focus on single local authority policymaking. This raises a question of how different authorities within a city-region or region may view inclusive growth priorities. In other words, how policymakers in Inverclyde (an area in the west of the Glasgow city-region that is still experiencing population decline) sees inclusive growth relative to Glasgow City (which is the commercial centre of the city-region) may not be uniform.

An additional question concerns whether the challenges of localized operationalization may succumb to a broader desire of policymakers to engage in progressive signalling. What is interesting here is how well-being discussions have now gained prominence, with bodies such as the Wellbeing Economy Alliance providing a new form of attachment and affiliation for Scottish-level policymakers. Indeed, with the Alliance comprised of members from a number of small independent nations, the Scottish government has a distinct motivation to be seen in those terms. In terms of the implications for local policy, however, we noted a genuine concern from several policymakers that the well-being agenda might reflect a desire to move on to the next big shiny policy agenda. Indeed, rather than building on inclusive growth – and working through some of the challenging aspects of operationalization – the risk of moving to the next progressive fad seemed all too apparent for some respondents (interviewees 3, 5, 9 and 10). Therefore, there is an issue as to whether moving to the next agenda simply allows policymakers to skirt the challenging questions of practice (interviewees 3 and 12). Should this play out, for this reason, the charge of signalling trumping action seems well placed, with one buzzword and emergent agenda simply replacing another.

Underpinning this paper’s concern for operationalizing inclusive growth, in summary, are the complex interactions between local, devolved and central governments. Our organizing categories of agenda, practices and politics permits the direct and indirect nature of these interactions to be fleshed out and points at their co-evolution. That is, the three terms need to be seen as overlapping – they exist together and are, indeed, animated, reinforced and potentially compromised by each other. For example, an inclusive growth diagnostic can emerge as an important practice to link national and local policymakers, but its sustainability (and longevity) will be determined by actors using it and developing it over time (that is, agenda buy-in). Though stemming from our particular Scottish context, we suggest that the three terms have value for considering the operationalization of other (or like) progressive economic development approaches in wider contexts.

CONCLUSIONS

Our four case studies provide different stories of how inclusive growth has been applied. Whilst there is a common intent for application – and commonalities can be pointed to in terms of the concern for external investment, procurement and skills – there is also variation in how the agenda has been adopted and progressed. For North Ayrshire, a small authority with persistent economic development challenges, the inclusive growth agenda was readily adopted and reads as the guiding approach for the growth deal signed. Work with inclusive growth started with the diagnostic (where it was piloted) and has evolved to consider how CWB can be used to guide the application of inclusive growth. Aberdeen, in contrast, came to focus on inclusive growth (at least the affiliation) later, and though inclusive growth is reflected in a pillar of the city-region deal, dedicated policy measures remain somewhat limited. Inclusive growth concerns are shaped, instead, by a sharp sectoral restructuring process confronting the area. Edinburgh is a strong performing economy within Scotland, and across the UK more generally, despite divides within the city-region. With still significant administrative capacity held locally, there is comfort, it appears, in working through the grey areas of inclusive growth, such as through the city deal, and shaping it to fit their interests (such as the adoption of ‘good growth’ to cater to local political differences; interviewee 11). For Glasgow, finally, the inclusive growth agenda came after the city-region deal, but, how existing investment programmes support inclusive growth, and what accommodation inclusive growth should be given in future strategies and investments, is exercising the minds of policymakers (interviewee 5).

These ex-post reflections present a novel contribution to the literature and provide lines of sight to analyses of policy applications in wider contexts. A key reflection across the cases is that instilling practices to reflect inclusive growth may be likened to turning around an oil tanker; it takes time. Initial successes come along the way, such as through fair work and inward investment, however, the pace of change is variable in urban and regional policy, and there is concern for whether there will be the political will – both at local and national levels – to support the agenda through points of uncertainty and challenge. As remarked in terms of the Edinburgh context: ‘we have narratives, but we are not delivering on them yet … that is just time … it is a positive direction, but it is hard to do’ (interviewee 11).

Timing also reflects the conceptual scope presented by inclusive growth, and, recalling Lee’s (2019, p. 425) earlier concern for operationalization, the ‘enthusiastic’ adoption and ‘uncritical embrace’ can both be observed. However, the Scottish regional contexts present a story of incremental policy learning and change. It is not a case of a eureka moment striking policymakers – a realization we can achieve x now, by taking steps a, b and c; rather it is a case of a ‘wicked problem’ being approached through small steps and evolving dialogue, where there is neither a clear solution nor a definitive (or singular consensus on) problem definition at the outset (Wanzenböck et al., 2020). Inclusive growth exhibits, indeed, the qualities of a wicked problem – ‘societal problems that are complex, unpredictable, and have poorly defined boundaries’ – and our analysis shows that it exhibits the characteristics of ‘contestation’ (different values presented); ‘complexity’ (‘multidimensional’ and ‘multi-scalar’ leading to doubts about who is responsible); and ‘uncertainty’ (concerning causes and the impacts of ‘actions and non-action’) (Wanzenböck et al., 2020, pp. 476–477). Such a framework may be apt for future empirical work.

Finally, a key political fault line laid bare in our assessment of inclusive growth reflects the ongoing tensions between local and national government. Indeed, Scottish policymaking shows that the delicate balance between subsidiarity, local autonomy and policy cohesion is an area that remains contested (Lessmann, 2012; Rodríguez-Pose & Gill, 2003). This is the case despite local governance review processes underway, whilst city deal commitments – a prominent mechanism for urban and regional policy to date – reflect a somewhat meek and partial response to these matters (O’Brien & Pike, 2019). The interesting take away point here, however, is that the fuzziness of the agenda, as set out by national government, may have inadvertently provided openings for local claims on national government for funding and support (based on varying local priorities). Related to this, our analysis lends support to the idea that, rather than seeking firm guidebooks for inclusive growth, there needs to be some acceptance for a wide range of versions of what inclusive growth is, while building on core principles (the balance of growth and distribution) (Evenhuis et al., 2021). As our case studies starkly illustrate, inclusive growth does, and should, mean quite different things to a successful city vis-à-vis a region with greater structural challenges (Iammarino et al., 2019), and indeed for the divisions of prosperity found within urban and regional contexts (Hughes & Lupton, 2021; Waite et al., 2019).

ACKNOWLEDGEMENTS

The authors thank Benjamin Cooper, University of Strathclyde, for the production of the maps. Author D.W. provided research support to the Commission on Economic Growth that advises policymakers in the Glasgow city-region, and Commission activities receive resource from the Glasgow City-Region Programme Management Office. Author G. R. is a member of the Glasgow Commission on Economic Growth and a panel member of the Aberdeen Economic Policy Panel. The paper reflects the views of the authors only, not any other persons nor bodies.

DISCLOSURE STATEMENT

No potential conflict of interest was reported by the authors.

Notes

1. A datazone is the smallest statistical reporting unit in Scotland, with each area having a population of between 500 and 1000 people. For a fuller explanation of the SIMD, see www.gov.scot/collections/scottish-index-of-multiple-deprivation-2020/.

2. More recent steps have been attempted; https://wellbeingeconomy.org/wp-content/uploads/Wellbeing-Economy-Policy-Design-Guide_Mar16_FINAL.pdf (accessed on 1 March 2022).

3. See https://democracycollaborative.org/neil-mclnroy (accessed on 1 March 2022).

4. For material on the diagnostic, see https://www.inclusivegrowth.scot/wp-content/uploads/2018/06/414813_SCT1119483414-001_Inclusive-Growth-Outcomes-Framework_P3.pdf (accessed on 1 March 2022).

5. Developing this perspective, it may be useful to consider further cases looking at how measures provided by JRF and the RSA in the UK – plus indicators set out by the OECD (2018) and ADB (2014) in wider contexts – have supported (or not) policy change.