Economic development strategies in the American states

Economic development has always been a moving target. Not surprisingly, there is growing evidence that the shape of economic policy and practice is significantly changing in many American states on the eve of the 21st Century. This article reviews the evolution and transformation of state economic development as well as its multidimentional character. The evolution includes roughly three broad, overlapping phases: a period when states focused on attracting businesses, a period when they focused on developing existing businesses, and a period when states refined and sharpened the strategies they already had in place. This article also offers evidence that a new, fourth phase is emerging in economic development. It is called cluster-based economic analysis and strategy development. This new approach has states addressing new issues, using new analytical tools, and experiencing new kinds of results.