Harvard prof shares ways to lift inner-city economies

Louis Aguilar
The Detroit News

A Harvard University professor displayed a sobering map of Detroit based on its economy. Big swaths of the city were marked in green — that meant those neighborhoods had at least 20 percent poverty rate and high joblessness. Virtually all of Detroit was green except for what’s known as “Greater Downtown” and the nearby riverfront, along with a dozen other small areas, most of them bordering the suburbs.


The map was created by Michael Porter, professor at Harvard Business School, who has studied the economies of American inner cities for 20 years. Inner cities fuel crippling social problems, such as drug abuse and crime, said Porter, and have become one of the most pressing issues facing the nation.

That’s because inner cities continue to grow, he said.

“The time has come to recognize that revitalizing the inner city will require a radically different approach,” Porter said.

The map of Detroit was part of his presentation at the two-day conference called “Revisiting the Promise and Problems of Inner City Economic Development” that wrapped up Wednesday at the Federal Reserve Bank of Chicago in Detroit.

The conference brought together civic leaders, academics and urban experts to explore ways to improve Detroit’s marginal neighborhoods.

Past efforts have largely failed because they are guided around meeting the needs of individuals such as income assistance, housing subsidies, and food stamps, Porter said.

“We have to take an holistic approach,” Porter told the estimated 300 attendees of the conference.

His suggestions to lift inner-city economies include:

■ Upgrade basic city services like streetlights.

■ Strengthen existing and emerging inner city clusters. Clusters are basically the network of small businesses that support each other such as food wholesalers and restaurant owners. Cities should find ways to strengthen such networks and link them to larger regional clusters.

■ Connect companies to growth capital. The access to bank loans is often one of the stumbling blocks for small and emerging businesses.

■ Increase company recognition and strengthen business networks. Honoring the work of small business is more than just flattery, but it helps build connections to other similar businesses and fuels competition.

■ Expand contract opportunities. A good example is the effort by the owners of the Red Wings to hire local contractors and vendors for the state-of-the-art sports/entertainment venue being built now.

Matt Cullen, president and CEO of Detroit-based Rock Ventures, said that parts of Detroit continue to steadily improve since the city emerged from bankruptcy last year. He and other city leaders say many of Detroit’s structural issues continue to be addressed.


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