Community & Economic Development Defined

Community Development is a term that can refer to comprehensive strategies or small projects. Because the use of the term community development is used in such a wide range of situations, the idea of community development can be misunderstood. In a similar way, Economic Development is a subject that can be misunderstood and one that people know very little about.


What is Community Development?

From a community perspective, community development includes nearly every type of purposeful community change. Creating purposeful change (development) of aspects of economy, health, physical infrastructure, governance, social needs, or other aspects of living addressed at a collective (community) scale- are expressions of community development.


Why do communities do Community Development?

Investments in community development are often intended to improve the quality of life for residents. Efforts to guide community development frequently start by assessing areas of needed change, or by identifying a preferred status the community would like to achieve. Results of Community Development can include:

  • A sense of pride and ownership in/for the community
  • A healthier environment
  • An engaged citizenry working in the interest of all the community
  • Improved services for community residents
  • Increased education opportunities
  • Increased employment or wealth accumulation opportunities
  • Overall improved quality of life


    What is Economic Development?

    Economic Development usually takes three forms in communities:

    1. Business Attraction
    2. Business Creation (Entrepreneurial Development)
    3. Business Retention and Expansion

    All three forms of economic development aim to create new primary jobs that pay more than the prevailing wage, increase the amount of income coming into the community from outside its market area, and create greater capital investment in the community. The strategy is to achieve this in a number of diversified industries.


    Why do communities do Economic Development?

    Economic development has three main purposes:

    • To give a greater number of people greater access to wealth through personal economic growth.
    • To increase the tax base of communities in order to provide higher quality public services to citizens.
    • To diversify the economic base and thereby cushion the community against economic shocks.

    Here is a video by Dr. Alison Davis, where she presents Economic Development 101.

    Ready to dig a little deeper into all things Economic Development? We have created an Economic Development Toolkit that will help skill up your economic development knowledge with several resources that you'll now have at your fingertips. Learn more.


    Who is Involved in Community & Economic Development Locally?

    Community scale changes benefit from representation from the community scale systems. Do you know which people in your community have roles to play in community & economic development (CED)? It is important to understand that CED is a shared effort among several stakeholders, and Extension can play an vital role. Here are just a few who may be in your community:

    • Local government
    • Civic groups
    • Local business or Chamber of Commerce
    • Economic development/banking or foundations   
    • Religious institutions
    • Education systems (from primary and secondary to university/formal and informal)
    • Health (can include public/private)
    • Recreation

    Development initiatives that impact everyone in a community are supported more broadly and more sustainably when the members of the community are represented and engaged in the process. While it is nearly impossible to have every person involved in every decision, it is generally true that people like to be involved in decisions that impact them. Thus, development initiatives should utilize processes that promote broad participation and strive for justice, equity, and sustainability.


    CEDIK has a Downtown Team Series that outlines the interests and roles of several community stakeholders in working on community level initiatives. Learn more.


    Are you ready to work with stakeholders in your community on development initiatives? CEDIK offers several resources for getting started on facilitation - from leading a community forum, to mapping stakeholder networks, and identifying community assets. Learn more.

    CEDIK CED Resources and Programs

    Business Retention and Expansion Program

    The Business and Retention and Expansion Program provides a better understanding of the local business climate through in-depth surveys of business owners. Learn more.


    First Impressions

    The First Impressions Program will help your community learn about its strengths and shortcomings through the
 eyes of first-time visitors. Learn more.


    Bludot Kentucky

    Bludot is a web-based business retention and expansion platform for local economic development teams in communities. The platform is free for all Kentucky communities. Learn more.


    SizeUp Kentucky

    SizeUp Kentucky provides business owners, start-ups and aspiring entrepreneurs with market research and business insights to help them make smarter decisions with data to effectively grow their business. The information is available 24/7/365 on the SizeUp Kentucky website at no cost to you. Learn more.


    Community Assessments

    Have your community assessed by expert economic developers and receive a comprehensive set of indicators that can be used to attract investment and economic activity as well as opportunities for improvement. Learn more.


    Customized Analyses and Reporting

    CEDIK offers a suite of services geared to providing community and industry stakeholders research-based information. We have an experienced research team that has proficiency with several proprietary data sources, methods of analysis, and GIS mapping capabilities. We offer customized studies, reports, and technical assistance on the following:

    • Economic Impact Studies
    • Industry Leakage Analyses
    • Retail Sector Analyses
    • Wage and Benefits Surveys
    • Survey Based Research Assistance
    Learn more about our customized services.   

    Excellent CED Resources Created by Others

    Glossary of Economic Development Terms
    California Association for Local Economic Development

    A quick list of definitions that you can reference when in a meeting and a stakeholder uses a term you're not entirely familar with.


    Economic Development Reference Guide (PDF download)
    International Economic Development Council

    This document provides more in-depth definitions of economic development topics and terminology. Each topic has several web links to additional information and resources.


    Community Economic Development: The Basics
    University of Wisconsin Extension

    Our colleagues at UW Extension have organized a great PowerPoint presentation overview of Community Economic Development and outlines Extension's role in CED.


    9 Economic Development Concepts Every Official Should Know
    Short Elliott Hendrickson

    This blog post outlines very current issues in local development that you might already be talking about in your community. The post provides insight into each of these issues and provides examples on how different communities addressed the issue.