Yale Economic Development Symposium
Yale SOM's annual Economic Development Symposium was held on February 15, 2019 with the goal of exploring how economic development strategies can produce more equitable societies and improve quality of life. The Symposium agenda included panels ranging from integrating climate considerations into development projects to the future of work, and featured keynotes from New Haven Mayor Toni Harp and Counterpart International EVP Ann Hudock. This year’s Symposium was abuzz with Amazon’s recent announcement that it had decided not to pursue a second headquarters in New York.
Amazon’s announcement captured the zeitgeist of the conference and prompted discussions of how future company solicitations might change as a result. GE also recently announced that its much-publicized move from Connecticut to Boston would have less impact on the city than expected. The company had planned to build a new headquarters in the city’s Seaport district but will instead lease a smaller space in Boston and reimburse the city for the incentives package it received. These two announcements seem to forebode that the much-publicized competition for corporate headquarters may be less appealing to cities moving forward.
The Symposium panel on Amazon’s second headquarters discussed how towns should approach both the application process and incentives offerings of mega-project competitions. Catherine Smith (SOM ’83), former Commissioner of the Connecticut Department of Economic and Community Development, shared that Connecticut approaches such competitions from a net present value perspective, considering the increase in tax revenue, strain on local infrastructure, and time and resources necessary to make such partnerships work. While a large corporation opening an office in a city can bring jobs and multiplier effects to the economy, panelists questioned how often these offices hire local residents and how these offices engage the communities in which they locate. Amazon’s failure to anticipate the strength of local organizing will hopefully be a learning opportunity for other companies as they consider moving into new geographies.
With the GE and Amazon announcements on Symposium participants’ minds, the evolution of company towns also became a topic of conversation. Panelists discussed whether a city should be dependent on a single employer and whether employers are hurt by dominating the economy of a city, per Michael Porter’s cluster theory. GE’s history of building extensive corporate towns has evolved into the amenity-filled Silicon Valley campuses of Facebook, Google, and Apple. These companies undeniably spur innovation and drive growth, but have clear negative as well as positive effects on the surrounding communities. Panelists discussed the employment of residents versus transplants, the ability for locals to access company resources, and the meaning of community partnership. Overall, the Symposium offered an optimistic perspective on the future of how corporations can be involved in economic development and how GE and Amazon’s recent announcements could improve the process for both cities and corporations moving forward.
By Amanda Faulkner, MBA ‘19