Cooperation,coordination and competition: Why do municipalities participate in economic development alliances?

Economic development is a policy area typically seen by municipalities as competitive in nature. Cooperation with neighbouring municipalities is rare, as the benefits are often selective. This paper examines the formation and governance of economic development alliances in Canada, specifically exploring the motivations of municipalities entering into these cooperative relationships. Four main factors influenced a municipality's decision to cooperate on economic development: reducing duplication, increasing international visibility, filling service gaps, and allowing for greater access to federal and provincial grants. Economic conditions dictated the course of partnership. Dividing mutual gains is the major challenge to overcome in order to keep economic development alliances together.