SIX URBAN REGIME TYPES: THE EFFECTS OF STATE LAWS AND CITIZEN PARTICIPATION ON THE DEVELOPMENT OF...

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SIX URBAN REGIME TYPES: THE EFFECTS OF STATE LAWS AND CITIZEN PARTICIPATION ONTHE DEVELOPMENT OF ALTERNATIVE REGIMESAuthor(s): JILL CLARKSource: Public Administration Quarterly, Vol. 25, No. 1 (SPRING 2001), pp. 3-48Published by: SPAEFStable URL: http://www.jstor.org/stable/40861827 .

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SIX URBAN REGIME TYPES: THE EFFECTS OF STATE LAWS AND CITIZEN PARTICIPATION ON THE DEVELOPMENT OF ALTERNATIVE REGIMES

JILL CLARK University of Texas at Arlington

ABSTRACT

This article reviews relevant urban regime theory literature and integrates it with new ideas about local government roles and citizen participation from the social movements and new political culture perspectives. Six regime types are formulated not only from these liter- atures but also from an examination of state government legislation that has encouraged cities to adopt both supply- and demand-side policies, to require contracts stipulating business obligations to government in return for subsidies, to permit or require citizen referenda on development issues and, in some cases, to target new jobs for minorities or low-income households. Additionally, this analysis relates each regime's formation and maintenance to particular group interests and decision-making institutions. Regimes are classified in terms of governmental and market roles in achieving efficiency and equity goals in economic development policy-making.

INTRODUCTION

Paul Peterson's City Limits (1981) provided an intriguing and controversial perspective for the study of urban policy, a political economy approach that underscored the importance of external, economic constraints on local government politics and policy choices. Specifically, Peterson argued that city officials pursue rational, investment strategies, consentual, developmental policies that enhance the



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prosperity of the city. They do so, he argued, because municipalities compete with one another for business locations by providing the most attractive service packages for the lowest tax price. Peterson (1981) also argued that local governments avoid

redistributive policy expenditures, those that increase taxes and provide no benefits for businesses or affluent taxpayers. Municipal leaders also select allocational policy priorities in order to provide housekeeping services at a price that is competitive with other municipalities. As the cumulative effects of global competition and

economic restructuring became more evident in the decades of the 1970s and beyond, American cities, with the assistance and encouragement of state governments, found that tax/service ratios for businesses could be made more favorable with selective incentives. As a result, most states offered tax abatements for business development and then invented programs designed to reduce the operating expen- ses of certain firms, usually corporate businesses: low cost loans; customized, free labor training; and government assumption of site preparation and infrastructure cases. Additionally, state governments facilitated both large and small business development with additional incentives: venture capital programs; business incubators and industrial parks; urban enterprise zones; quick take laws; tax increment financing districts; state consulting or management services; and public-private partnerships with state universities. While external competition for businesses in an era of

capital mobility is clearly an influence on city policy choices as Peterson (1981) argued, there may also be internal. Political factors that effect the type or scope of development policy choices among municipalities. In other words, local politics may influence the shape of economic



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development policy. One internal political factor, regime type, has been suggested as a useful concept for understanding intermunicipal variance in development policy- making, Stone (1987a: 17) defines the regime concept in these terms: "Instead of policy making being a matter of a community's unitary interest, regime theory treats policy as a struggle over a community's political arrangements." Regime theorists, like Stone, begin with the acceptance of

tax base competition as an economic imperative, a given. As a result, business is not just another interest group but represents the market, the source of both tax base and jobs for the community. Corporate locational decisions are made in board rooms where profits guide locational decisions. In fact, business interests need not actively campaign for development incentives; instead, elected political officials may take the initiative since they are well aware of the primary motivations of mobile businesses and the locational incentives offered by other municipalities.

Peterson's assumption of a consensus on the desirability of government efforts to encourage development is sometimes challenged by citizens who hold alternative views of the community interest. These alternative views include the costs of development incentives to taxpayers, the effects that development has on a city's quality of life, environment or neighborhoods. Still other citizens take the position that the benefits of development are not community-wide and that economically disadvantaged and minority citizens often receive little or no benefit from taxpayer investments in business. If taxpayers organize and successfully oppose the in-

creased costs of development investment, then the regime may be a caretaker type (Sanders, 1987). If minority groups organize to facilitate set asides and locational advantages, then the regime is a progressive type. If political leaders



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and business interests pursue business incentives with little organized opposition, then the regime is an entrepreneurial type, according to Stone (1987b). As a result, regimes seem to be defined in terms of interests or the degree of group participation in policy-making. Alternatively, regimes are sometimes defined in terms of the vision of political entrepreneurs, especially mayors who develop one of these three regime strategies (Grimshaw, 1996; Pagano and Bowman, 1995). The regime theory conceptualization of group actors and

mayoral entrepreneurs typically does not include more recent citizen initiatives flowing from popular reactions to economic restructuring and previous experiences with tax incentives for business. The social movements literature is the exception in which Portz (1990) and Nissen (1995), among others, have examined cases where citizen groups have organized to cope with plant closings. In these cases, community groups, often led by labor, have developed not only new conceptions of the community interest separate from that of corporations but also new development policy strategies like plant closing legislation. Clark and Goetz (1994) formulated two new local

political cultures relevant to local economic development policy-making: the "new fiscal populism" and a postmaterialist "new political culture." The first political culture type is based on citizen resistance to increased taxes and government growth; the second, to the primacy of quality of life in relationship to economic growth.

There is little controversy that economic restructuring has eliminated middle class, blue collar jobs and instead has created service sector employment in most cities. Some service sector jobs are professional and high wage; others, that are available to the unskilled, are low wage, sometimes seasonal, and often without fringe benefits.



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American companies have transferred industrial jobs to other countries, replaced workers with mechanized and downsized or merged operations. The national government has actively pursued free trade agreements that sometimes encourage certain heavy industries to migrate abroad increasing the flow of foreign goods into the U.S. consumer market. As a result, thousands of American workers in large corporations have lost jobs and, those that still have them, may experience more job insecurity than in the past. These aspects of restructuring have had an impact on

national politics, from serious disagreements over the North American Free Trade Alliance (NAFTA) and in the presi- dential candidacies of H. Ross Perot and Patrick J. Buch- anan, for example. At the same time, global competition and the resulting de-industrialization have weakened interest groups, principally labor, supporting national social policies such as welfare. Furthermore, the private-sector practices of downsizing and merger for competitive advantage have been applied to the reinvention of the national government, including decentralization of federal policy responsibilities to state governments. Regulation theorists have focused on these downsizing

and decentralization tendencies in the U.S. and other postindustrial societies. Lauria (1997:7), for one, posited a postfordist regime where global competition has resulted in "privatization and the dismantling of collective services." His expectation is that national governments will reduce or eliminate their welfare state policies and move away from the protection of labor interests associated with the previous fordist regime. The implication of the regulation theory perspective is that local governments will have no alternative but to cater to the interests of mobile businesses with favorable tax price ratios and tax incentives. The



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expectation would be the proliferation of entrepreneurial local government regimes with few, if any, exceptions. While the regulation theorists may have captured the

essence of a changing national role, American state governments have developed new strategies in an era of federal devolution and downsizing. In fact, state governments have already enacted a number of incentives and constraints that influence local regime development. Most states have not only encouraged locational incentives through legislation and gubernatorial initiatives but several have also passed policies to encourage small business development, particularly in economically depressed neighborhoods. More recently, a few states have enacted regulatory legislation like plant closing, anti-merger or clawback legislation where businesses that do not perform as promised or who exit must refund taxpayer dollars. One of the prime issues raised in these studies of econ-

omic development policy-making is how to integrate the Peterson and regulation theory positions with those of regime theorists and the social movements literature. This article attempts to do so by examining regimes in terms of interests, institutions, and ideas. It begins with the assumption that the typical municipal response will be, as Peterson and the regulation theorists suggest, entrepreneurial: to facilitate growth with favorable tax rates and service packages for business as well as abatements and other subsidies. On the other hand, a few cities reject a growth goal and

can be characterized as caretaker types. These cases, the entrepreneurial and caretaker, might be conceptualized as opposite ends of a continuum. In between are cases where cities provide advantages but also set conditions on business which represent concessions to various local interest groups: minorities, and the economically disadvantaged; neighborhoods; environmentalists, postmateralists, and



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historical preservationists, and fiscal populists, and anti- government groups. Thus, different regimes may form depending on the strength of these groups and the coalitions they form. However, regimes require more than the identification of

salient groups; they also require the presence of both certain facilitating institutions and ideas of community interest or the appropriate government role in economic policy- making. Without the combination of interests, institutions, and ideas to delineate regimes, regime theory represents no more than traditional elitist and pluralist conceptions of community power structure. The purpose of the article is to review the literature on local economic policy-making in order to identify the role of these groups, their facilitating institutions, and the underpinning ideas associated with different regimes.

This article addresses other gaps in the literature on economic policy-making. First, it attempts to expand the number of possible regime types because existing typologies do not contain all possibilities. Some deal with central cities only; others focus on cases of plant closing and perhaps deviant cases like San Francisco. Second, some case studies examine only the role of neighborhood groups while others focus on mayors as policy entrepreneurs. The result is that none of the typologies generated from a limited set of comparative studies is comprehensive in terms of relevant actors and institutional bases across municipalities. Third, the regime types generated in the case study literature are usually not formal typologies derived from the cross tabu- lation of key variables. This article attempts to provide a more systematic typology of regime types based on the presence or absence of a governmental role in addressing the conditions of development decisions and the division of benefits.



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Fourth, the economic policy-making literature has given little attention to the role of state governments in shaping the institutions of local regimes. As a result, this article examines state actions and their effects on local regime generation and institutionalization. Specifically, most of the American states have encouraged entrepreneurial regimes by adopting supply-side incentives. Some states have also enacted demand-side initiatives, "fairness" regulations stipulating business obligations to taxpayers or citizen participation requirements. As a result, regimes are not entirely the result of either external factors or internal political actors. Their development and stability are also influenced by state legislation. The next section of this article will first discuss four

regime types found in the literature: the entrepreneurial, caretaker, player, and progressive. Then state government actions shaping local regimes will be examined in combination with the player role in order to develop a new regime type, the stewardship. The progressive regime type will be considered next and then merged with the stewardship role to develop another regime type, the activist. Finally, state small business incentives will be connected to progressive regimes in order to formulate a sixth type, the demand-side regime. Each of these six types will then be described not only in

terms of actors (groups and policy entrepreneurs) but also their institutional bases and underpinning ideas. Finally, a formal typology, cross-tabulating the ideas of efficiency and equity associated with different public and private sector roles, will be generated to produce the regime types. Students of public administration may be especially

interested in studies of economic development policy- making and regime types. First, economic development agencies, planning departments, and city managers and



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their staffs are sometimes key players in different regimes (Cable, Feiock, and Kim, 1993; Clavel, 1986; Elkin, 1987; Jones and Bachelor, 1993; Lupsha, 1987). Second, regimes are based on ideas of trade-offs between efficiency and equity, concepts that frame contemporary discussions of both the role of bureaucracy and service delivery methods (Peters, 1996). Third, regime types are relevant not only to economic development policy-making but also to housekeeping services, neighborhoods, the environment, and redistributive policies.

REGIME TYPES

Entrepreneurial Regimes

The authors of regime theory case studies, focusing on business and government relationships in entrepreneurial regimes, have typically questioned the political economy assumptions that local officials are simply prudent managers of the community interest and that there is no controversy over business subsidies. Instead, they have suggested that elected officials have political motivations, i.e., reelection goals, in pursuing economic development policies and defining community interest.

In Playing the Field, for example, Euchner (1993) asserted that mayors pursue sports franchises in order to claim "big league city" status, to demonstrate the tangible benefits of their leadership, to direct attention away from the more intractable social problems of urban life, and to forge a symbolic sense of community. Furthermore, these goals were useful in developing a strategy to confront any opposition: "The symbolic potency of sports can be decis- ive in political conflict. If a sporting event or institution is considered an essential part of the community, a contrary



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politician or activist group can be seen as anti-community" (Euchner, 1993:169-170). Euchner concluded that municipal leaders were powerless in influencing locational decisions beyond meeting the escalating financial demands of the sports industry. Otherwise, the teams would migrate. Sports businesses, which are monopolies, have the upper hand in bargaining with city officials. The community's interest is to meet business demands in order to keep the franchise in the city. In the Searching Hand, Jones and Bachelor (1993)

presented an alternative scenario of the ability of mayors to influence the locational preferences of businesses. They examined a case of peak bargaining between General Motors (GM) and Detroit Mayor Coleman Young. According to their analysis, Young utilized a variety of political, as well as financial, resources to persuade General Motors to locate a new plant in the city. Before the mayor's intrusion, all indications were that GM preferred an alternative, suburban site. Not only did Mayor Young acquire necessary state and local funds for the project but he also effectively managed neighborhood opposition in the area to be cleared for the plant site and used his political connections to the Carter administration to expedite and maximize federal commitments to the project. He rallied community support based on his political popularity and mobilized city planners to meet GM's deadlines. Jones and Bachelor (1993) thus suggested that the issue is

not whether politicians will offer the required financial incentives for private industry but whether central city mayors can gain competitive advantage over other cities or adjacent suburbs with astute political skills, intergovern- mental political connections, and talented city planners. In other words, the community's interest - acquiring new development regardless of cost - is served by a political



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entrepreneur with sufficient political resources to co-opt opposition from negatively affected neighborhoods and to amass public funds.

In a study of Dallas, Elkin (1987) demonstrated a relationship among business interests and electoral politics, bureaucrats, and growth policies. He described a city where business interests organized and financed slates of council and mayoral candidates who supported their progrowth agenda. Moreover, reformed government structures (the city manager form and at-large council elections) and professional bureaucrats facilitated a consensus on growth policies and prevented the politicization of the development issue. These structures also eliminated an independent political base for any elected official to represent alternative views on development.

In a case study of the development of public/private sector partnerships in Louisville, Kentucky, Vogel (1990: 111) suggested that Elkin' s picture of a symbiotic business and government relationship is common: "In the world of politics, public officials need business leaders to contribute campaign money, public credibility, and lobbying at higher levels of government. Likewise, businesses need government contracts, regulatory relief, and cooperative officials who will facilitate their development plans with subsidies and incentives."

These case studies and others suggest that there is an alliance between government and business to facilitate growth and to co-opt potential opposition through closed negotiations, to actively pursue resources from higher levels of government, and to organize successful progrowth electoral coalitions with business interests. Political entrepreneurs promote the idea that development is not only in the community's interest but also that development projects create a sense of community identity or accomplishment.




Overall, there are indications that a good deal of local political organization is necessary to develop and sustain the consensus on growth policies that Peterson (1981) regarded as automatic.

Caretaker and Player Regimes

In an essay that relates the political economy and regime literature, Grimshaw (1996) focused on mayoral leadership for managing conflict between development imperatives and other interests in a regime. Mayoral responses in managing this tension was based on two factors: the strength of a mayor's alliance with business interests in the city and the degree of citizen participation in the city. The four mayoral leadership roles that Grimshaw specified were the entrepreneur, the caretaker, the broker, and the advocate. The entrepreneur had a strong alliance with business and faced narrow representation of other interests in the city. A caretaker mayor was inclined to preserve the status quo while a broker was most concerned with managing the conflict between business and citizen groups. Advocates had high executive autonomy based on a strong partnership with business but also faced high levels of citizen participation. As a result, they might choose to be "social justice" mayors who advocate that development benefits be shared with neighborhoods through minority set asides and similar programs.

In a set of comparative case studies on urban economic development, Pagano and Bowman (1995) also underscored the role of public, and not business, leadership in developing policy responses to varying economic conditions. They posited a four-fold typology of cities based upon the role of the mayor in reacting to local economic conditions. They categorized a mayor's response to




economic decline as either maintenance or survivalists. Maintenance cities exhibited low activism in mobilizing public resources for economic development; survivalist cities did the opposite. In response to the absence of or relatively low levels of fiscal distress, mayors chose either a market or an expansionist orientation. Market cities made little effort for economic development when the economy was good but expansionists did the opposite, perhaps to "move up" in the hierarchy of cities in a region. Like regime theorists who focus on the role of political

leaders, Pagano and Bowman noted the mayor's influence in generating the regime. Mayors whose cities faced similar economic conditions formulated different policy ideas. Their responses led to either the entrepreneurial or caretaker regimes in Stone's (1987b) terminology. According to their analysis, entrepreneurial regimes may develop inde- pendently of economic conditions: in some cases, they develop in response to economic decline but, in other cases, these regimes are formed to advance a city's standing in the hierarchy of cities. Instead of regime theory, Molotch (1976) posited a

growth machine concept that suggested the dominance of progrowth conditions in local politics. Where there was opposition to growth, it came primarily from residents, particularly in affected neighborhoods. Following, Mo- lotch, Logan, Whaley, and Crowder (1997) reviewed new perspectives characterizing the conflict between progrowth and antigrowth groups: facilitator (progrowth) cities, growth management cities (compromise between business and residents, and exclusionary (antigrowth) cities. Their exclusionary cities are similar to Stone's caretaker regime. Their growth management city, where there is bargaining between business and residential interests, suggests another




possible regime type that is conceptually similar to a city with Grimshaw's (1996) broker mayor. There is evidence to suggest another regime type, dif-

ferent from the entrepreneurial, caretaker or progressive, in case studies of plant closings. In an analysis of community responses to industrial shutdowns, Portz (1990) identified three types of government roles: the bystander, the offsetter, and the player. The bystander designation describes local governments that see plant closings and their effects on the community as private problems. An offsetter government, on the other hand, "finds local policymakers assuming a significant part in shaping and supporting the economic adjustment process (Ibid, 159). Here, the government does not interfere with private-sector decisions but attempts to develop an alternative scenario for plant survival, usually labor concessions and increase taxpayer investment in the firm. The bystander and offsetter regime types correspond to the caretaker and entrepreneurial regime types identified by Stone (1987b) and others. The player role, however, suggests a new regime type, a

different arrangement for managing the conflict between business and community groups, especially labor: active government participation in private decision-making. Local governments participate in "key business decisions as marketing strategies, management reorganization, and product development" (Portz, 1990:162). A second player strategy is to use coercive government powers to address a plant closing situation: eminent domain powers to assume municipal ownership of the plant or exit fees, for example. In Fighting for Jobs, Nissen (1995) also identified entre-

preneurial and player regime types in plant closing case studies. Government responses to closing were either providing public subsidies and lobbying for increased federal funds for a local plant, which is a characteristic response of




an entrepreneurial regime or emphasizing business obligations to the community in exchange for public support - a populist, player role in Portz's (1990) terms. Nissen found no case in which government's response to a plant closing consisted of a passive caretaker role.

Overall, then, this literature has identified four basic regime types: the entrepreneurial, the caretaker, the progressive, and the player. The entrepreneurial has already been described at length. As a result, the next section first examines the caretaker role more extensively in order to suggest not only its basic configuration but also its ideational relationship to the player role. Then, the player role is extended to cases of development policy-making other than plant closings. This extension permits the creation of a new regime type, the stewardship regime, where state legislation has been a key factor in shaping local regimes. Next, the progressive type is discussed and a related, fifth regime is generated: a demand-side, neighborhood regime. Finally, the progressive and stewardship regime characteristics are combined to create a sixth type, the activist regime.

Characteristics of Caretaker and Player Regimes

Several case histories have identified regimes as caretaker types. These regimes are characterized by their reluctance to invest government revenues in large-scale development projects. Sanders (1987) noted this tendency in the case of a medium-sized city with a high percentage of homeowners, Kalamazoo, Michigan. Whelan (1987) found a similar response in the resistance of taxpayers, small businesses, and preservationists to large-scale development projects in New Orleans. Lupsha (1987) detailed the reli- ance on development, not governmental, initiatives in




Albuquerque. In these citi.es, the dominant caretaker coalition was challenged at times by progrowth forces - political entrepreneurs and business interests. The policy choice of each regime was to reject supply-side initiatives funded by taxpayers and to leave development initiatives and costs to the private sector. The community's interest in caretaker regimes is to mini-

mize the size and role of the government sector and its costs to resident taxpayers. The private marketplace directs development and assumes its risks. In contemporary resistance groups, Clark (1994) has identified this perspective as the "New Fiscal Populism." This political culture typically incorporates a belief in citizen participation in economic development policy-making through direct democracy devices, public hearings or other represent- ational venues. As a result, Grimshaw's (1996) key variable, degree of citizen participation, is subsumed by this political culture type. Fiscal populists have sometimes derided development

subsidies as "corporate welfare" or reverse distribution policies. In Louisiana, for example, the Coalition for Tax Justice developed a successful campaign against a supply- side policy, property tax abatements; the state law for a time barred municipalities from providing these abatements to business. The issue redefinition of tax incentives as corporate welfare ultimately failed, however, according to Boeckelman (1997). On the other hand, by 1995 a total of fourteen states had laws that banned property tax abatements (LeRoy, 1 995) Clark (1994) also identified a "New Political Culture"

that defines community interest as maintaining a desirable lifestyle for residents rather than supporting large-scale development with locational incentives and other subsidies to business (Ibid). This definition of community interest is




associated with environmentalists, neighborhood advocates, historical preservationists, and others more concerned with parks, recreational areas, and neighborhood amenities than growth (DeLeon, 1992). DeLeon (1997:149) describes this political culture as

postmaterialist in his analysis of San Francisco: "At the level of the city, postmaterialist values encourage political initiatives in such areas as environment protection, neighborhood preservation, urban aesthetics, individual liberties, and citizen participation." According to both Clark and DeLeon, postmaterialists give a higher priority to quality of life than to economic growth. Miranda and Rosdil (1995:184) tied the development of

antigrowth perspectives to economic restructuring: "Dyna- mic processes if social change in the postindustrial society have encouraged the replacement of traditional issues characterizing city politics by quality of life issues, especially among change-oriented young adults. In locat- tions where these processes of cultural transformation have reached a critical mass, culturally innovative communities are rejecting many core assumptions of the traditional culture, including the desirability of additional, unre- stricted growth." Although some have argued that antigrowth perspectives

are limited to a few unrepresentative cities like San Fran- cisco, a 1994 survey revealed 47 cities with antigrowth groups (Clark and Goetz, 1994). These municipalities were located in Florida and California, college towns, cities with nuclear plants close by, and cities in New England, the Northwest, and Pacific Coast areas. More recent studies suggest the proliferation of antigrowth community activism in a wider variety of cities (Clavel and Depp, 1990; Keating, Krumholz, and Star, 1995; Oden and Mueller, 1999).




Clark and Goetz (1994) extensively analyzed development policies in American cities to determine the importance of antigrowth groups on development policy choices. They found that antigrowth policies were highly correlated with the strength of community groups representing the postmaterialist political culture. Anti- growth groups were more likely to be found in communities with younger, more affluent, and more highly educated citizens who are members of the Sierra Club.

Antigrowth groups - fiscal populists and postmateralists - reject subsidies to big businesses; the first because subsidies represent a redistribution from taxpayers to companies and the second because corporate priorities take precedence over the values of lifestyle and amenities. Both groups favor more extensive citizen participation in development decisions. Given open access to decision- making, especially citizen referenda, fiscal populists and postmaterialists may sometimes form a coalition to oppose and defeat large-scale development projects. For example, Cable, Feiock, and Kim (1993:96) found that antigrowth groups were more successful in defeating development initiatives where there were opportunities for popular participation: "Popular participation is indeed likely to tor- pedo economic development efforts, at least those involving diffuse costs, lending support to assertions by radical political theorists that development and democracy (/>., legitimation) are contradictory in liberal democracies."

More specifically, the authors found that tax abatement policies were more likely to be adopted in affluent cities with low property tax levels. Participatory structures also have an impact, some more than others: "However, the presence of committees to represent the entire community mitigates the probability of tax abatement adoption whereas open public meetings increase adoption likelihood" {Ibid).




In general, they found that cities with fewer citizen participation structures were more likely to grant tax abatements.

There are other potential allies for antigrowth groups in some cities: a specialized local economic development agency or division in local government. Specifically, Kim and Feiock (1998) found that these institutions depress the use of development tools, like tax abatements, when they are independent and under council-manager forms of government (as opposed to mayor-council forms). They conclude that the use of these tools under council-manager form of government is linked with the economic situation of the community and plans for development constrain the proliferation of such incentives, while in mayor-council governments, the proliferation of such financial incentives is not affected by economic need or plans for development.

Clavel (1986:210) suggests that, in some cases, profess- sional planners have become allies of those interested in the quality of life in cities impacted by economic restructuring. Planning, he comments, "supplied the cause-and-effect chains that connected their sense of the deterioration of the urban economy to actions that could be taken in support of urban populations."

Although professional bureaucrats were largely unsuc- cessful in limiting the progrowth coalition in Albuquerque, Lupshaw (1997:237) suggests they formed the only visible opposition: "[I] n Albuquerque the coalition, constantly active in limiting excessive aggrandizement toward the short-term future and its profits, is composed of the pro- fesssional public administrators and bureaucrats who seek to provide a voice of moderation, future orientation, and professionalism and who, more often than not, fill the vacuum and the role of public representation vacated by elected politicians."




Stewardship Regimes: Business Obligations to Community

Nissen (1995) provides a basis for understanding the player regime perspective by examining how labor and other groups developed new definitions of community interest, separate from the interests of business, in the face of plant closing. He suggests that populist, player regimes share a fundamental characteristic: stipulating business obligations to the community in exchange for government resources.

Eisinger (1988:328) noted a similar development of this "fairness" issue in a survey of state economic development policies more than a decade ago. In discussing government efforts to regulate plant closings, to develop performance contracts with business or to use eminent domain powers to take business property when an enterprise shuts down and concluded: "The articulation of some sort of 'fairness standard' that structures expectations and establishes norms of behavior for the public and private parties to mutual efforts in economic development is one manifestation of this new role." Similarly, Clark's (1994) "New Fiscal Populism" stressed greater government accountability to citizens of public monies.

Nissen (1995:151) also specified some stewardship requirements in the area of plant closings: lengthy prenotification to local government of a closing, full co- operation with efforts to save the plant through a sale, gen- erous out-placement benefits to affected workers and similar provisions for affected communities, attempts to attract replacement industry, and the like." He found this stewardship role to be quite different from the typical entrepreneurial role in economic policy-making: "The standard 'good business climate' understanding requires [governments] to aid corporate objectives of private profitability




but to accept a totally dependent stance free of corporate obligations to the community" (Nissen, 1995:155). By 1993, the National Governors Association had de-

veloped guidelines for state subsidies to businesses. One of them encou8raged a stewardship role, the use of clawbacks, i.e., "provisions to recoup subsidies if the business community fails to deliver promised benefits in return for state subsidies" (Zimmerman, 1996:151). Nine states and four cities had already adopted clawback provisions on some business subsidies by 1995 (Ledebur and Woodward, 1990; LeRoy, 1995; Peters, 1993). Furthermore, during the period of "merger mania" in the

1980s, Pennsylvania pioneered legislation regulating mer- gers by stipulating, among other things, that corporate directors take into consideration the interest of the community as well as the stakeholders. By 1995, twenty-three state had passed anti-take-over legislation but in narrower form than the Pennsylvania statute (LeRoy, 1995). Imbroscio (1995) explored the possibilities of "nontra-

ditional" public enterprises as community interest: direct public ownership, leasing public property to private entrepreneurs (with a provision that ownership remains public) and equity holdings in private enterprises. Imbroscio (1995: 225-6) made the goals of these policies clear: "[T]he pursuit of local public enterprise can be seen as a part of an effort to make local government 'run more like a business,' as the public sector approaches economic development matters in a more entrepreneurial and businesslike man- ner."

Some states now require that business tax incentives be reported as tax expenditures so that citizens are aware of the program costs of public investment in private development. A community's interest in limiting the size of financial obligations to the private sector has also been a




subject of other state government actions: setting statutory standards for the types and sizes of businesses that qualify for tax abatements or tying the amounts of abatements to the number of jobs created.

Finally, a few states, including Texas, have attempted to limit the business advantage in bargaining with government in locational decisions by legislating "anti-piracy" or "anti- portability" provisions. These laws bar tax incentives for companies that have moved from one municipality to another in the same state. LeRoy (1995) found that by 1995 twenty-seven states had company reporting requirements for tax expenditures and nineteen had written requirements to determine company eligibility for tax breaks.

This stewardship idea represents a more adversarial role for government when dealing with business, one that developed in loser communities where major companies decided to exit. This position is often advocated by labor groups seeking severance benefits or employee ownership of plants. Nissen' s (1995) study ties the success of labor to cases where unions formed a coalition with other community groups and developed a competing concept of the appropriate role for government in dealing with business interests. In fact, coalition partners for labor and other community groups are in some cases homeowners or taxpayers whose beliefs are associated with Clark's "New Fiscal Populism."

Taxpayer and "good government" groups seeking accountability and good management of government funds are likely to support policies that stipulate business obligations to government. Stewardship policies may represent concessions to antigrowth groups who oppose development but, if these groups cannot win that battle, they may be able to reduce the risk of taxpayer investments. Antigrowth groups may be part of a prevailing




coalition or regime but their power is sometimes limited to shaping the contract between business and government or the design of the development, not defeating growth initiatives. Where antigrowth groups have been more successful, they may have established a caretaker regime. The recent state-level legislation reviewed here suggests

that a coalition of labor and taxpayer "fairness" interests or other citizen groups have been successful in several states with the enactment of clawback, anti-merger, and taxpayer information legislation. Success at the state level has, of course, redefined a number of local regimes as stewardship types.

Progressive Regimes

The distribution of development benefits is the key feature of progressive regimes. The focus is not on whether the local government should provide funds for certain types of development or what obligations business has to the community as a whole. Instead, the focus is on the role of government in the allocation of benefits from the development to various groups or areas of the city. The issue is economic equity, the redistribution of tangible benefits to those who have the most need for development benefits: the economically disadvantaged and/or minority and ethnic citizens. Other needy beneficiaries are those in the position of paying more of the costs of the development: neighborhoods changed or destroyed by growth. In a progressive regime, community groups, in addition

to public and private elites, participate in decisions concerning the allocation of development benefits: ethnic minorities (or other groups) set aside for government contracts; job targets for minority employment; "fair" wage standards; or the location of the development in an area of




high unemployment. If the development negatively impacts an existing neighborhood, the issue is compensation for residents and businesses.

Progressive regimes, according to some authors, are often established in response to victorious electoral coalitions, especially those led by minority mayors (Giloth and Moe, 1999). Browning, Marshall, and Tabb (1990:27), for example, found that minority-led, progressive coalitions were frequently fervently progrowth and "that economic development became a principal strategy." They also suggested that the focus of growth was downtown development and that the division of development benefits was the key issue. "What was different about their implementation of development was the extent to which they extracted commitments for minority business participation and minority hiring from developers" (Ibid). Perry (1997:193) found the connection between electoral support and minority development benefits clear in Birmingham: "The black majority expected benefits in return for its policial support of [Mayor] Arington and the predominant black city council. In effect, blacks expected a quid pro quo." Cities as different as New York, Des Moines, and San

Jose have passed "living wage" ordinances requiring businesses that receive tax abatements, similar subsidies or, in some cases, even do business with the city to pay a certain percentage of workers a specified hourly wage. More than two dozen jurisdictions have a "living wage" ordinance on the books and similar proposed ordinances have reached the institutional agenda in dozens of others (Association of Community Organizations for Reform Now, 2000). Furthermore, Peters (1993) found that three of the nine "clawback" states he studied had job quality standards; state law required that there be some targeting to minorities and low-income households.




Demand-Side Regimes

One possibility for an alliance between postmaterialists and minority or class interests is to adopt a development strategy aimed at small business creation and neighborhood revitalization: demand-side policies. Postmater- ialists can integrate this small business strategy, especially the development of high technology businesses, with their concern for quality of life. Minorities support the possibility of funds to improve economically disadvantaged neighborhoods, stimulate jobs, and "birth" minority-owned, small businesses. Even fiscal populists can see few local taxpayer costs, as well as potentially available state funds, in comparison to supply-side investments like local property tax abatements. By the middle 1980s, several states had moved to incor-

porate a demand-side policy strategy (Eisinger, 1998). Demand-side policies provide state assistance for small business development, especially high-tech businesses and sometimes even "birth" small businesses through state- operated venture capital programs. There is typically an emphasis on high technology and expert market development. Grant II, Wallace, and Pitney (1995) analyzed state demand-side policies and found that they were composed of three dimensions: entrepreneurial programs, urban enterprise zones, and tax breaks for compliance with political control legislation. Entrepreneurial programs in- cluded "research parks, incubators, venture capital programs, and research and development grants for industry" (Ibid, 140). Enterprise zones allowed tax breaks for business location or job creation in economically depressed areas. They found that states that have pursued all three of these demand-side state policy types are typically located in the East North Central or Mid- Atlantic regions.




Eisinger (1995) subsequently discovered a waning interest in demand-side policies in some states, the resurgence of supply-side initiatives in others, and the development of "third wave" alternatives by the 1990s. These "third wave" policies focused on empowering local communities to find ways to help themselves through limited state investment. Specific programs "include investment in job training and education, industrial modernization initiatives, support for community-level development planning, and encouragement of industrial clusters of firms for the purpose of pooling resources to achieve higher levels of international competitiveness than each firm could manage on its own" (Ibid, 153). Two of these strategies, investment in job training and education and community-level development planning, may encourage the expansion of demand-side, stewardship or activist regimes. The other two seem appropriate to entrepreneurial regimes: industrial modernization and pooling industrial resources.

In one of the few studies on state-level policy impacts on local government, Reese and Malmer (1994) examined the effects of state property abatement legislation on local development strategies. They classified municipalities in states with abatement bans as demand-side localities and those without abatement bans as supply-side. Their purpose was to determine whether municipalities expand the demand-side orientation (property tax abatement ban) mandated by states to other local, development policy choices. They found that, "contrary to what was hypo- thesized, cities not allowed abatements do not evidence a widespread shift to demand-side techniques" (Ibid, 127). They did suggest, however, that there is a tendency of demand-side communities, in comparison to supply-siders, to view neighborhood development as a priority.




In many cities, large-scale, citywide development projects, supported by minority mayors, have generally benefited middle-class minority interests but have provided few benefits to the poorest citizens (Browning, Tabb, and Marshall. 1987). As a result, new demand-side initiatives have been promoted by some local leaders. These regimes target disadvantaged areas with neighborhood initiatives. For example, under Mayor Schmoke, Baltimore's neighborhood projects operated on the basis of partnerships among community groups, businesses, and government. The focus was not only on economic development but also on social development (housing, human services, and education). Furthermore, these neighborhood organizations represented an institutionalized setting for citizen participation in development decisions. In a cooperative study of neighborhood organizations in

Chicago and Pittsburgh, Ferman (1996) concluded that electoral incorporation of a neighborhood interests was insufficient to ensure community gain sharing. In Chicago, where there was no institutionalization of neighborhood organizations, gains were short-lived. In Pittsburgh, on the other hand, the integration of neighborhood groups into the local process had brought them enduring benefits. "Neigh- borhood organizations have been recognized as part of the city's permanent organizational landscape for nearly twenty years. These arrangements have not only survived four mayoral administrations but they have been strengthened with additional resources, authority, and responsibility. An 'antineighborhood' administration has an extremely dif- ficult time rolling back those gains" (Ferman, 1996:150-1). Berry, Portnoy, and Thompson (1993) also suggested that

the presence of neighborhood organizations was associated with demand-side policies, especially concessions from business. Neighborhood opposition to development was




predictable in cities where there were permanent and citywide neighborhood organizations. When faced with such opposition, they concluded that "business has the incentive to cooperate with neighborhood organizations and to make the compromises necessary to win their support. There is really little choice" (Ibid, 287). They did concede that such organizations may, in fact, speed development projects along by co-opting some of the adversaries of business who may be less likely to confront a neighborhood organization that has agreed to the development once concessions were gained. Relying on Peterson's analysis of a city's development imperative, the authors conclude: "Clearly, cities must pursue development. What citywide systems of neighborhood associations accomplish is that they allow citizens to have some say over just how much and what kind of development. That is no small achievement" (Ibid, 150). A regime that provides citizens "some say over just how

much and what kind of development" may stimulate political conflicts and alliances at the local level. DeLeon' s (1997) study of San Francisco is instructive. He found an initial conflict between minority interests and postmaterialists and suggested that the latter' s opposition to large-scale development conflicted with the former's priority for generating new, high- wage jobs for the economically disadvantaged. He did report, however, some new alliances between environmentalists and minority groups at the neighborhood level. "[T]he Earth Island Institute and other local environmental groups have begun in mounting toxic cleanup campaigns and fighting different forms of racism" (Ibid, 155.). He similarly found that some organized labor groups enco'uraged opportunities for the economically disadvantaged, including minorities, through their efforts to lobby municipalities to set standards for jobs




created by developers: fair wage and benefit compensation. One example was labor's efforts to organize service workers in order to increase both the pay and benefits of nonindustrialjobs.

NEW REGIME TYPES

This review of the literature suggests the possibility of developing six regime types. Only one, however, is based on government funding for development without concessions to other interests in the community: entrepreneurial. The other four are growth-shaping regimes functions to address the costs and risks of taxpayer investments in the private sector (the stewardship regime), the division of benefits with minority and class interests (the progressive regime) or small business generation in neighborhoods (the demand-side regime). The fifth is the activist regime where there are both business obligations to the community for subsidies and a division of development benefits targeted toward particular groups. Only one regime is based on opposition to a governmental role in facilitating development: the caretaker. The case studies and quantitative analyses reviewed here

suggest that each of these regimes relies on particular mechanisms for generation and maintenance. Table 1 shows these regime types and suggests possible relationships between regimes, their primary institutional bases, and the typical, public-sector actors involved in economic decisions. Entrepreneurial regimes usually function with closed

development decision-making venues composed of relevant private-sector interests and political leaders who may orchestrate citizen representation like public hearings or neighborhood meetings but their purpose is to co-opt




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potential opposition. Mayors may have additional allies if the city manager and professional bureaucrats are progrowth advocates or professionals who facilitate development by mustering effective plans and resources, particularly in mayor-council cities.

These regimes are sometimes generated by electoral coalitions organized by business interests supportive of unfet- tered growth. At other times, political leaders adopt a progrowth position and engender business support. It is also possible that economic development is not an explicit campaign issue but that a mayor later develops a new vision to revitalize or to improve the city's image or position in the hierarchy of cities.

In stewardship regimes, fiscal populists, concerned with the costs and risks of investment in private-sector businesses, seek to shape growth decisions by stipulating business obligations to the community in a formal contract. State government legislation has been the principal means of establishing these regimes. However, local labor, taxpayer, and anti-government groups may also cooperate to generate a stewardship regime and seem to be most successful where they can form a coalition, redefine the community interests, and convert local government officials to their point of view. Citizen participatory opportunities facilitate the development and maintenance of a stewardship regime. Alternatively, negative experiences with earlier govern-

ment investments in firms (such as plant closings) may encourage the development of stewardship regimes. In effect, performance contracts facilitate the continuation of supply-side policies; they make it possible to offer business incentive policies in the face of public resistance and criticism.




Progressive regimes incorporating minorities, the economically disadvantaged, shape growth by stipulating business obligations to those groups through set asides in jobs or contracting and are typically associated with winning electoral coalitions led by minority candidates who pass affirmative action or fair wage policies. There may also be state laws requiring the targeting of development benefits to minorities or low-income households. Even if the winning coalition is later displaced by another, single member district representation or permanent neighborhood governments may provide continued attention to the division of benefits by representatives from minority and/or economically depressed areas. Activist regimes involve two dimensions of government

activity: stipulating business obligations to the community and requiring economic equity in the division of development benefits through set asides for minorities and the economically disadvantaged. This regime is typically structured by a combination of state laws and successful electoral coalitions that encourage an activist role both in shaping the conditions of development and dividing its benefits. Demand-side regimes are shaped either by a critical mass

of local groups, particularly postmaterialists and minority interests, favoring small business development or by minority mayors. The focus of these regimes is at the neighborhood level in order to accommodate quality of life and economic revitalization in depressed areas. In some case, state legislation encourages these efforts by providing state funds through enterprise zones and venture capital programs, for example. Other cities ban property tax abatements. Winner cities (in tax base competition for corporations)

may also convert to the demand-side after they invest some




significant funds in business. Taxpayer resistance to the costs of development programs or the size of the government sector may preclude further major investments. Demand-side policies allow the government to retain an active role in development after a number of large investments have been made. While large projects are implemented, the emphasis is on smaller, less costly projects to generate public support for continued business subsidies. Caretaker regimes seek to maintain the status quo either

to preserve the quality of life or to keep taxes low and prevent the growth of government. In some cases, the regime may be associated with taxpayer and homeowners interests; in other cases, with environmentalists, preservationists, and neighborhood activists. The most effective institutions for establishing this regime are probably the initiative and referendum but other citizen participation devices like public hearings or elections may also be a vehicle for expressing antigrowth views. In fact, some mayors may adopt a caretaker role and it is possible that some professional bureaucrats or planners support the coalition based on analyses of negative consequences or public costs of growth. Sate laws permitting local direct democracy or requiring citizen voting on tax increases and bond issues proved a possible base for these regimes.

Critics of regime theory have argued that regimes are sometimes defined as mayoral administrations lasting only until the next election and complain that a regime, if enduring, must be institutionalized. This generation of regime types has suggested that certain institutions are likely to be associated with different regimes. However, some of these institutions facilitate either a longer or shorter life span for a regime. Closed decision-making venues like economic development corporations, associated




with entrepreneurial regimes, may create an established triad, a fairly stable institutional base for private/public sector partnerships. Permanent, city-wide neighborhood organizations may

provide a relatively long-term basis for citizen control in caretaker or stewardship regimes. Direct democracy devices may constitute a firm base for citizen control in caretaker or stewardship regimes. State laws provide a continuing source of inclusion for fiscal populists in stewardship regimes. In progressive regimes based primarily on transitory electoral coalitions or leadership vision, mayoral roles may be less stable over time. On the other hand, set aside policies and "living wage" ordinances may provide some institutionalization.

Overall, the most striking feature of the institutional bases of these regime types is the importance of state laws. Local regimes are structured not only by internal politics and external economic constraints but also by state laws which provide incentives or constraints in the development of different types of local regimes.

A focus on the dominant ideas of community interest is necessary in order to understand the role of the same institutions in different regimes. For example, bureaucrats may be facilitators of business incentives in some cases and opponents in others. The difference is related at least partly to the dominant ideas of community interest: whether subsidies to firms are considered ihe most efficient community strategy or whether quality of life and protection of public investments in private businesses take precedence. Citizen participation devices may be utilized by different groups that seek either no-growth or growth- shaping alternatives. Mayors have different agendas. Some may be social justice advocates; others, entrepreneurs, and




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still others, caretakers. The ideas underpinning regimes and regime actors are considered next.

CONCLUSIONS

Regime studies often focus on business incentive decisions so it may appear that these regimes are limited to policy decisions involving locational incentives. Some critics of regime theory have made this point, particularly since case studies typically focus on economic development and not other policy areas. However, if a regime is defined as a stable relationship between business interests and local government, then its definition of community interest or guiding ideas may well reach beyond business incentive decisions. Development incentive decisions are presumably limited by previous commitments of taxpayer funds and municipal resources. As a result, a regime must focus on other policy decisions to accomplish its purposes. Similarly, expenditures for economic development may limit scarce resources for other program areas. Table 2 lists the dominant community ideas and policy strategies likely to be associated with the six regimes for other municipal service areas. If the focus returns to Peterson's (1981) tax/service ratio

as the device for intermunicipal tax base competition, then additional substantive policy areas can be incorporated under regime theory. Furthermore, Stone (1977b) suggests that the key ideas underpinning different regimes are efficiency and equity. In the interests of efficiency, an entrepreneurial regime would seek a favorable tax rate for all businesses in addition to offering locational advantages to particular businesses. Political leadership would have a commitment to efficiency in the delivery of all public




services to keep tax rates competitive with other municipalities (Peterson, 1981). Infrastructure development, like transportation facilities,

that benefits many types of businesses would also be an expenditure priority. If possible, entrepreneurial regimes would seek funds from higher levels of government to improve business-related services or to rely on taxing nonresidents to fund these services. Thus, service quality would be high for businesses and the local tax rate low. Entrepreneurial regimes would also choose to depress citizen demands for either redistributive expenditures or high cost "housekeeping" services, perhaps by relying heavily on reformed government structures and closed decision-making arenas. Fiscal populists is a stewardship regime would likely

support both the entrepreneurial regime's efficiency goal and its avoidance of redistributive policies. According to Clark (1994), this political culture supports program alternatives like privatization of government service delivery, government downsizing, and leveling off. They do so, however, not to advantage businesses but to control taxes and government growth in the interests of citizens. None- theless, stewardship regimes may pursue policies similar to entrepreneurial regimes in terms of service delivery efficiency and avoidance of redistributive expenditures. Fiscal populists are not likely to be supportive of in-

creased taxation and governmental expenditures for transportation infrastructure or other business-related services. They are more likely to favor increased citizen participation and consumer choice in service delivery decisions. Busi- nesses, public officials, and fiscal populists may share efficiency goals but the two regimes differ on the key parti- cipants in policy-making and the openness of policy-making arenas. This perspective suggests that community




interest may not be defined completely by efficiency and equity norms as Stone (1987b) suggests. Another relevant definition of community interest in-

volves the governmental role in ensuring citizen accountability and/or participation in policy-making. Entrepre- neurial regimes would rely on closed decision-making structures, perhaps a professional bureaucracy when government is "run like a business." Stewardship regimes would instead rely on citizen participation through more open venues like citizen review boards and public hearings or through participation in the state legislative process. Progressive regimes, where there is a focus on economic

equity, pursue redistributive policies not only in the distribution of development benefits but also in other policy areas like municipal employment and contracting. The leadership would aggressively pursue federal funds for redistributive policies such as health care and welfare. Clavel (1986) suggests other redistributive policies associated with progressive regimes: rent control ordinances and public ownership of facilities like hotels leased to the private. The requirements of public ownership were that all part-time jobs went to to residents and were allocated through the high school's work study program. There were also set asides for jobs and contracting levels for minorities and residents. Although some critics argue that set asides are inefficient,

progressive regimes embrace the idea that the gains in equity outweigh any efficiency losses. Thus, progressive regimes accord a higher priority to economic equity than do the entrepreneurial or stewardship types. Furthermore, instead of focusing on participation by taxpayer interests like stewardship regimes, progressive regimes will likely rely on minority incorporation: political leadership and citizen review boards representing minority interests.




Activist regimes combine the ideas of both the stewardship and progressive regimes. The postmaterialists' "quality of life" focus may encour-

age certain expenditures for the arts, aesthetic landscapes, environmentally friendly programs, historical areas, and cultural enrichment. They may well favor increased taxes in order to enhance the quality of services in these areas. On the issue of tax increases, they are likely to be at odds with fiscal populists but entrepreneurial regimes may embrace a cultural development emphasis as part of a business climate strategy. Although the focus of such efforts would be largely in

neighborhoods, some support from postmaterialists and, perhaps more importantly, other residents can sometimes be incorporated in large-scale, government-sponsored cultural or historical projects. These institutions are a possible key to the development of downtown entertainment districts, theme parks with sports arenas, and adjacent small businesses, movie theaters, restaurants, boutiques, sports museums, and/or "festival marketplaces." In this case, the appeal to postmaterialists is the creation of a citywide "urban neighborhood" and to other citizens as consumers rather than taxpayers. The postmaterialist strategy also relies on the develop-

ment of a sense of community through these defining cultural, historic or entertainment institutions. In evaluating the visibility of entertainment development, Fulton (1997:26) argues that central cities have an advantage over suburbs in this kind of development strategy because "downtown has a history, a sense of place that resonates with people, and - at their best - a reason that goes beyond separating people from their money." Minority interests in demand-side regimes might reject

these policies as elitist and would instead focus on building




neighborhoods where social development policies are incorporated with economic development policies. Social programs like job training, community policing, and health services would be a part of neighborhood revitalization strategies. If efficiency, equity, and ideas about the appropriate roles

for government and the market are considered the key ideas associated with regime types, then these factors can be cross-tabulated to produce the six regime types displayed in Table 3. On the vertical dimension, ideas about the roles of government in encouraging efficiency produces three possi- ibilities: (1) promoting efficiency by simply subsidizing market priorities; (2) representing taxpayer interests so that investments are more efficient for citizens, that is, stipulating performance contracts for business in return for subsidies; or (3) choosing not to make a risky or unpopular investment.

The second feature, equity, focuses on government roles in allocating the costs and benefits of a particular development. The first governmental role is to do nothing; the private sector allocates the costs and benefits of a development project. The second is to promote economic equity, a community interest, by ensuring the distribution of the benefits of development to minorities or the economically disadvantaged. The third role is to promote social equity by representing neighborhood interests or those of the entire community by revitalizing or preserving the quality of life for residents; the government may alter the type, location or requirements of a development to address citizen concerns or reject particular types of development in favor of maintaining the status quo.

This typology of six regimes suggests that the issue is not always whether a community will invest in growth or take an antigrowth stand. Most communitieis pursue business




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subsidy policies but governments play a variety of roles in representing citizen interests in conditions of the investment or division of development costs and benefits to particular groups, neighborhoods or communities at large.

Entrepreneurial regimes pursue growth without conditions for business subsidies; the private sector decides on location, the size and longevity of operations, the design of the business, and employment policies. Progressive regimes also specify no conditions for business in exchange for public subsidies but government stipulates equity in development benefits: set asides for the disadvantaged or "living wage" requirements. Demand-side regimes also provide subsidies without conditions but generally to small businesses. However, the government plays a role in promoting social equity by addressing the quality of neighborhood life through generation of social and economic development in disadvantaged areas or through the preservation of neighborhoods.

Stewardship regimes, on the other hand, assume responsibility for protecting taxpayer investments but not in the division of development benefits (equity). Activist regimes combine the government's role in generating conditions of investment and in addressing the interests of the disadvantaged or labor in the distribution of benefits. Caretaker regimes leave both efficiency and equity decisions to the private sector; government is not involved except to chal- lenge any effort by political entrepreneurs to restructure the status quo, the community's quality of life or tax levels. Some communities may consistently follow the ideas

associated with one of the six regime types suggested above. However, it is also possible that other localities may select a combination of development policies at different points of time. Certain taxpayer investments in business




development may be rejected but others may generate high levels of public support. As a result, it could be that these regime types are really nothing more than characterizations of different development policy types. On the other hand, it may be that entrepreneurial regimes dabble in a few demand-side policies, perhaps when state funds are available but that the city's major development strategy is to provide subsidies to corporations whenever possible. A regime may be something like a party system: there is a need to examine over time patterns of policy outcomes in order to identify the regime type.

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