What is Local Economic Development?

Defining LED is no easy task. One way of trying it anyway is by saying what it is not:

So what then is LED? Let us first to describe it by giving a few examples of LED projects:

These examples lead us to a more analytical definition of LED: it is about local activities to make markets work better. It is not about distorting markets, and it is not about substituting them. LED aims remedying market failures such as barriers to entry, information problems and high transaction costs.

Yet another way of defining LED is by formulating a few guiding principles:

It is important to note that LED involves very different target groups. A multinational company which may invest in your location is as much a target of LED activities as is the young black unemployed with limited skills who has some entrepreneurial talent. LED is about small and big things, and it includes everything from very modest to very fancy activities. What all this must have in common is business thinking. LED is not social work. The guiding principle of LED is competitiveness. You want to make sure that your location has qualities which are competitive with those of other locations, so that companies choose your place rather than going elsewhere. And you want to make sure that local markets work, so that manifold business opportunities arise.