From June 2006 to June 2007, researchers from the UNC-Chapel Hill School of Government screened, researched and documented 50 case studies of small towns across the United States that are using a wide range of community and economic development strategies to advance their communities’ vision for prosperity. The case studies are a response to the demand for examples of real communities facing challenges related to globalization, geographic isolation, urban sprawl, aging populations and natural disasters.

The focus of this report is community economic development (CED), defined as action taken locally by a community to provide economic opportunities and to improve social, civic and environmental conditions in a sustainable way. (1) That is, CED is a process through which communities initiate their own solutions to local problems. CED strategies create economic opportunities, but in a way that improves social, civic and environmental conditions. Finally, CED strategies tend to include some consideration for sustainability, or for building long-term community capacity to deal with future challenges and opportunities.

There are two reasons for the use of such a broad definition. First, a typical definition of economic development tends to narrow the scope of acceptable activities to those with direct (and measurable) economic outcomes. Jesse White, the director of business and economic development at UNC-Chapel Hill and the former federal co-chair of the Appalachian Regional Commission, defines economic development as “activities that take place at the intersection of public policy and private commerce to create jobs, businesses, prosperity and wealth.” (2) Under this definition (and most others), the explicit goal of economic development is to make measurable improvements to the economic health of a particular jurisdiction. Equity, or the distribution of economic benefits, is only implicit in most definitions of economic development. CED addresses equity explicitly because it is a process whereby a community realizes positive changes in each aspect of community life – economic, social, civic and environmental.

Second, small towns typically have limited resources and capacity, so their economic development activities tend to include a broad range of strategies, including those that might otherwise be considered community development or capacity-building. In small towns, strategies for dealing with housing, transportation or leadership development tend to be combined with more traditional economic development strategies as parts of a community’s comprehensive development strategy. “Success” in community development tends to be harder to define and measure, compared with economic development outcomes, but is important nonetheless. The social, civic and environmental impacts of a community’s CED strategy have tremendous bearing on the extent to which a community feels that it is successful. Excluding these impacts would sacrifice elements of success that small towns repeatedly said were important.

Conceptual framework

Given the definition of CED, there are two inter-connected sets of ultimate results or outcomes that small towns are hoping to realize by implementing any CED strategy (or set of strategies). The relationships between and among CED strategies and these outcomes are graphically represented in Figure 1 and the numbers and letters in the following text refer to that figure. This discussion will begin at the right side of the figure, focusing on outcomes, and move to the left.

First, small town economic development efforts are intended to achieve economic outcomes that include increases in the number of jobs and businesses as well as indicators of prosperity and wealth (1). Second, they are intended to achieve other outcomes, that is, to achieve economic results in a manner that positively affects the community’s social, civic and environmental conditions (2). Next, there are three direct ways to achieve the economic results: communities can recruit businesses from outside the jurisdiction; they can work to strengthen and expand existing local businesses; or they can develop programs and support networks aimed at creating new businesses. These are the three main approaches to economic development (3). Case studies in this report will demonstrate the importance of explicitly considering the other community development outcomes as part of the economic development process (indicated by arrow B).


 Small town CED

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Next, small communities tend to work toward the goals inherent in the definition of CED by implementing a wide range of strategies and using tools that blur the lines between community and economic development. In other words, most successful small towns recruit, retain and create businesses with a combination of traditional economic development, alternative economic development and capacity building strategies – often categorized as community development (4, 5, 6). Traditional economic development strategies and tools tend to be more direct and short-term, in terms of the ultimate economic outcomes that can be attributed to their implementation (4). These strategies include but are not limited to industrial recruitment incentives, business visitation programs, workforce development and tourism development. Because of their relatively short horizon and measurable effects, these strategies tend to be more politically feasible and easier to fund, implement and measure.

By contrast, alternative economic development strategies tend to be more indirect and long-term (5). They carry higher levels of political risk, funding presents a greater challenge, and their results are more difficult to measure, as compared to traditional strategies and tools. Examples in this category include efforts to foster local entrepreneurship, downtown revitalization and strategic arts- or cluster-based development.

Finally, undergirding a small town’s ability to implement any economic development strategy, traditional or alternative, is an element of capacity. Capacity-building strategies tend to be associated with community development (although not always) and include building physical infrastructure, such as broadband Internet networks, as well as organizational and leadership development activities (6). In some small, rural communities, a strategy to develop new leaders or to create new partnerships in an effort to build capacity can be as important a strategy as any, especially when combined with more traditional and/or alternative economic development strategies.

This model, in which small towns choose to pursue traditional, alternative and capacity-building strategies – based on their community’s specific strengths, weaknesses, opportunities and threats – to achieve economic and other outcomes, guided the selection of towns featured in Small Towns, Big Ideas.

Methodology and case selection

This project was designed to be a broad qualitative research assessment. It is not a study of best practices, which, as the term implies, ought to be subject to rigorous evaluation and replication. Rather, small towns were selected to provide the reader with exposure to a wide variety of strategies and tools at work across a range of local conditions. An arbitrary decision was made to produce 10 analytic cases and 40 descriptive cases. The analytic cases describe the communities in depth, identify and discuss the varied CED strategies at work in each community, and venture to answer questions about how and why a particular combination of strategies produced positive outcomes within the local context. Descriptive cases are shorter and describe CED strategies that small towns are using to advance their vision incrementally.

The selection of cases began with a key informant identification process, which resulted in a list of more than 150 small towns that were known, either by word of mouth or in print, for success or innovation in CED. In addition to screening cases for geographic and strategic diversity, each case features a small town with fewer than 10,000 people in which a CED strategy (or strategies) is active and where CED activities are controlled locally. (3) In other words, we did not want to re-tell old stories and we did not want stories in which local civic leaders were not playing a major role in strategic decision-making.

Analytic cases were screened for evidence that the community’s strategy was successful, in economic, social, civic and/or environmental terms. Analytic cases also were screened for evidence that the strategy was financially sustainable and that it demonstrated some measure of adaptability to changing circumstances. For example, we sought evidence that a particular strategic approach to CED continued across more than one term of local political leadership. Descriptive cases were screened for evidence that the community’s strategy represented CED innovation (first or early use of a particular practice) or a distinctive practice (unique among the alternatives for addressing a particular problem) within the local context.

For the 10 analytic cases, interviews were conducted in-person, over a one- to four-day visit to the community. For the descriptive case studies, interviews were conducted over the telephone or by e-mail. Data collected during interviews were supplemented by newspaper articles, scholarly articles and other written content.

After final selection, case studies were categorized by the predominant characteristic of each community with bearing on its development opportunities and challenges. These categories became the sections in Small Towns, Big Ideas. Towns were characterized as:

  • recreation or retirement destinations or adjacent to an abundance of natural assets
  • having historic downtowns or prominent cultural or heritage assets
  • home to or adjacent to a college campus
  • adjacent to a metropolitan area or an interstate highway

These categories are not, nor were they intended to be, mutually exclusive. For example, a community categorized as being a recreation or retirement destination (Brevard, N.C., for example) might also have a historic downtown. Communities were categorized based on the relationship between the local asset being categorized and the community’s approach to development. Categories were intended only to ensure that the full sample of case studies covered a diverse range of community contexts and to provide the reader with a relevant starting point for identifying similarly situated communities in Small Towns, Big Ideas.


(1) Definition is partially derived from the term’s definition on Wikipedia, available at This definition was chosen for its simplicity, and because the Wikipedia model is one in which volunteers collaborate to define key terms, a concept that was deemed appropriate for the subject matter of this report.

(2) Jesse White, “Economic development in North Carolina: Moving toward innovation. Popular Government, 69(3), Spring/Summer 2004.

(3) Two case studies of towns with more than 10,000 residents are included. Helena-West Helena, Arkansas is a case study about two small municipalities that incorporated during the process of implementing their strategy. Douglas, Georgia is a case study about a small town that grew beyond 10,000 during its implementation phase.

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