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Abstract

This paper seeks to answer whether incentivizing makers and small-scale manufacturing has any effect on the economic development or economic growth of a region. Currently, no research exists indicating a causal link between economic growth and incentivizing makers and small-scale manufacturing. Much of the previous conversation from economic development focuses on place-making and revitalization of distressed areas. This paper attempts to link three observations together to infer a positive correlation with economic growth: that higher productivity cities have higher levels of wages and employment; that incentivizing or promoting small-scale manufacturing increases their number and success; and that these small businesses contribute to most of the economic growth or percent change in annual revenue in localities. The observations are sourced from a production function that correlates a region’s level of productivity with wages and employment; case studies of two cities implementing similar economic development plans; and a longitudinal study of economic growth in 25 large U.S. cities. This paper infers that incentivizing makers and small-scale manufacturing has an overall positive effect on the economic development and growth of a region. This paper also discusses positive and negative externalities of the process and the limitations of utilization among varied regions and demographics. Further research is suggested to determine the level of impact makers and small-scale manufacturing have on varied scales of economies as well as gentrification mitigation efforts.

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