Does new development support local economies?

One of the claims of growth-dependent planning is that it supports growth in local economies - it works with local planning to deliver new built stock that meets economic demands and planning can shape that development to help build a robust local economy. Proponents of the green growth approach further see the potential for such development to foster a local market for green construction technology and development skills if the buildings and development sites are pushed and pulled into more environmentally-friendly directions. The issue here is the extent to which such new development produces benefits for the locality or whether they seep outside to the broader national or even international market. The New Economics Foundation has long been arguing for the importance of local economic development that produces a local multiplier effect because the money generated - say, here by the actual development activities - stays and circulates within the local area. In this context, it is interesting to see the contractor for new development at Birmingham City University's campus promising to spend £28 million of its £46 million contract on local firms within 20 miles radius of the project site. This is an promising approach and one that extends the commitments to sustainable, environmentally-certified and even fair trade product and services that are increasingly bound into contacts. Without such strong linkages between the development process and local business, particularly SMEs, and populations the claims of development projects to foster local economies can often sound rather hollow.