Undermining the Growth Machine: The Missing Link between Local Economic Development and Fiscal Payoffs

Abstract

During the last 15 years, a powerful concept in the analysis of local politics has been the machine: the potent coalition of government officials and local business elites united in the pursuit of economic development. Growth policies were often supported by residential members of communities, who sought better services and lower taxes through economic growth. While the growth machine is undoubtedly still among the most potent forces in local politics, in many communities residential support for pro-growth policies has been replaced by strong opposition. Using a sample of approximately seven hundred suburban municipalities, I show that the flow of fiscal benefits to communities from economic development has slowed during the last 15 years. Given the mounting costs of growth and the increasing costs of pro-growth policies, the lack of significant fiscal payoffs helps explain growing disaffection with the growth machine and the rise of the antigrowth movement.