Extension's Roles in Economic Development

Introduction

The economic hard times of the early 1980s and the current farm crisis have given an urgency to discussions within Extension and other adult education institutions about how they should be involved in economic development education. As the links between farming and rural communities become clearer,¹ Extension Services are coming to view economic development as important to farm and nonfarm families alike. The difficulty of defining the appropriate roles in economic development for Extension, however, often hampers the development of effective and relevant educational programs.

Extension's Roles

Extension has at least four roles in the economic development arena. In any given state, it may address only one or several of these in its educational programming.

Provide Perspective

The first role Extension can play is to put the local social and economic changes and decisions into perspective. A given community's mill shutdown or high technology employment growth needs to be placed in the context of what James Fallows recently called "America's Changing Economic Landscape. "² To make effective economic decisions, communities must understand how changes in the global, national, and regional economies affect the opportunities they have.

An Extension program can provide this content, helping a community compare trends in income, employment, poverty, unemployment, labor force participation, and other economic and social statistics with those of the region and the nation. It can also do this by describing the forces affecting these changes and the projected trends in these larger forces.

Particularly important would be the changes in the employment structure away from agriculture and manufacturing toward services, the increasing dependence of the American farm family on off-farm income, and changes in income structure from earnings toward transfer and investment incomes. Major demographic changes include migration from the north to the south and west, and the "greying of America, " in which the elderly are becoming an increasingly large share of the population. Each of these changes has implications for the types of economic opportunities available to local communities.

Another important aspect of helping put economic development into perspective is to ensure that community leaders ask "the right questions. " Extension has a critical role in this part of the program, in my judgment. Communities often ask, "What kind of tax incentive or public investment is most effective in bringing in industry? " They should first ask, "is bringing in industry the most effective way to increase and stabilize incomes in this community in the long run? " Or, indeed, "What alternatives exist for improving the income status of the poor and unemployed in our community? "

The point is that someone outside the process can often help frame the question and thus improve the value of the answer. The earlier in the analytical process that the right question is asked, the more effective the analysis will be in affecting the outcome. Extension can use its understanding of broad socioeconomic trends and its experience with other communities to help community decision makers ask the right questions.

Increase Knowledge Base

A second role in economic development education is increasing the knowledge base for community decisions. Some analysis of the current economic situation in a community and of alternative ways to meet community objectives must be made. Traditionally, Extension has been effective in this phase of economic development education. It has a long history of educating communities about their local economic structure and conditions and the social and economic impacts of alternative development paths.

Extension has also been involved in: (1) analysis of the feasibility of, and financing options for, local community infrastructure investments; (2) identification of sectors in which communities may have comparative advantage; and (3) analysis of the effects of alternative local development policy tools and investments on the probability that a firm will locate in an area. We have been involved both in increasing the knowledge of citizens about options and impacts (the application of social science research to community problems) and in developing analytical skills of local officials.

Teach Management Skills

A community can understand the context of its decision, ask the right questions, and correctly analyze its alternatives, but still be unable to reach its development objectives, because local leadership lacks needed skills (or because the national, state, or local institutional structure works against these objectives). A third role for Extension in economic development education is leadership training, helping those who have an interest in economic development to obtain the skills necessary to achieve community goals.

Extension has proven its ability to teach business management skills. Although this ability isn't usually found in a community development staff, these skills are in high demand by small business people, who represent the bulk of the new businesses and whose efforts create a large share of the new jobs on which many economic development efforts depend. Teaching business management skills may be a component of some programs on economic development.

Shape Institutional Structure

An opportunity exists for Extension to play a fourth role in economic development: involvement in shaping the institutional structure (the laws and organizations) affecting economic development. This can be by involvement in the legislative process to change either (1) substantive government institutions (for example: spending, taxing, or regulatory law; laws relating to development; or creation of public investment institutions) or (2) procedural aspects of government (such as the scope and timing of citizen involvement in various decisions).

This involvement can take place at the local, state, or national levels. It can also be directed toward shaping voluntary organizations as well as governments. Extension can be a source of innovative institutional ideas as well as a conduit for the analysis that shapes the design of new institutional arrangements. Just as perspective, asking the right questions, and social/economic knowledge are important in local policy decisions, they're also critical in designing institutions that define social priorities and determine the outcomes of development efforts.

Choosing Appropriate Roles

For states with a history of clearly defined Extension efforts in economic development, the choice of roles may not be a pressing issue. I would argue, however, that all states ought to reexamine the roles they play, and that program leaders ought to ensure that at least the first three of the four roles identified above are part of any economic development Extension efforts. Extension certainly doesn't need to fill each of the roles itself, but it may be the best institution to ensure that the different roles are played.

States with large community development programs may be able to provide all four roles. The University of Wisconsin, for example, has a community development education program in which Extension, through workshops and publications:

1. Explains the global economic context.
2. Provides analysis of the local community employment and trade patterns.
3. Helps local leaders with goal setting and organizational skills.
4. Is involved in the development of financing institutions.

This economic development education is part of a four-part Extension response to the farm financial hardships in that state.

Most states, however, don't have the resources to mount such an effort. They need to focus on one or two roles.

Currently, the emphasis in most states is on the provision of knowledge: bringing the results of social science research to bear on locally defined problems and teaching people how to analyze public policy issues. In such states, Extension doesn't see its primary role as providing perspective or leadership skills, but as providing educational help in the analysis of the question that is asked by the community.

Other states emphasize the development of leadership skills among those interested in pursuing community development. Extension professionals draw on other organizations, including state agencies and non-Extension personnel in land-grant universities, to play the other roles in their economic development education program.

Still other states find their role in economic development to be one of providing the overall perspective on global, national, and regional economic trends and of ensuring that communities ask the right questions in their economic development efforts. In my opinion, this is the most important role for Extension, particularly in states just beginning to become involved in economic development education or in states with small community resource development staffs. In most cases, we're not adequately staffed to provide training on the nuts and bolts of business location decisions that would be helpful to development organizations.

What many technically trained consultants often can't provide, and what is needed at least as much as technical assistance, is help in framing questions and putting local problems into a larger perspective. This is something Extension can and should do in the context of specific training events and publications. By using Extension expertise to frame the questions and the expertise of non-Extension cooperators, where necessary, to provide technical information, Extension can provide a service that's often unavailable to citizens and officials and can play a critical role in the economic development process.

In different states, Extension will find different appropriate roles in economic development education. Where its niche is will depend on the availability of other economic development educational resources in the state, the size and training of existing Extension staff, and a host of other factors. By more clearly specifying its own role and the roles of others in the economic development education process, Extension should be able to more effectively serve the leaders and citizens of America's communities.

Footnotes

1. Ron Shaffer, Patricia Salant, and William Saupe, "Rural Economics and Farming: A Synergistic Link, " Agricultural Economics Staff Paper 235 (Madison: University of Wisconsin, April 1985) and Russell Youmans, "Sustaining American Farm-Ranch Family Income: The Land Grant Institution Can Help, " WRDC 27 (Corvallis, Oregon: Western Rural Development Center, September 1985).

2. James Fallows, "America's Changing Economic Landscape, " The Atlantic Monthly, CCLV (March 1985), 47-68.