TLED v. traditional Economic Development

Economic development is the process of improving the quantity and quality of an economy. The quantity element is the output of the economy, often measured as GDP. The qualitative element can be focused on factors such as equality, and can be measured by such things as a GINI coefficient. Economic performance at a national level is most often centered on output or GDP, so economic development at the macroeconomic factor is most often focused on developing the two primary inputs that drive output, capital and labor. At a state and local level, the indicator that is most often used to measure economic performance is job creation (or loss). The primary objective of the general public and politicians for economic development at a local or state level is job creation. The three most significant conventional strategies at a local level are to recruit companies to an area that will bring jobs, seek to retain companies and their jobs in an area, or promote entrepreneurs and the development of new companies that will create jobs.

Only a portion of economic growth can be explained by increases in inputs from capital and labor. A significant portion is driven by other factors, and technology factors are recognized as playing the most important role among other factors. Technology-led Economic Development focuses on the technological element that drives economic growth. There are two important elements to this. The first is the creation and application of new knowledge. According to Feldman and Link, science creates new knowledge, and technology applies this new knowledge to a problem. New technology creates economic opportunities. The second path, again per Feldman and Link, is through entrepreneurs who take an invention, which is the creation of something new, and apply it, making an innovation. Technology-led Economic Development seeks to foster the process of utilizing technology and supporting entrepreneurs in order to generate economic development. The primary tools for Technology-led Economic Development are the dissemination of new knowledge created by science so that it can be economically exploited and supporting entrepreneurs who can employ knowledge and invention as innovations, in the process, creating and growing firms. Technology-led Economic Development offers two significant attributes that make it especially exciting. The first is that it moves beyond the zero sum concept that dominates much of traditional economic development work where localities are engaged in competing for the same firms, and the second is that job and economic growth has a chance to be geometric and sustained as opposed to linear and sporadic.