Building Rural Community Resilience Through Innovation and Entrepreneurship

Charlie French, Charlie French

• Publisher: Routledge
• Year: 2022
• ISBN:
  9781000538465
• Edition: 1
• Topic: Architecture
• Subtopic: Urban Planning & Landscaping

Drawing from empirical analyses, case studies, and a synthesis of best practices, this book explores how innovation manifests itself in rural places and how it contributes to entrepreneurial development and resilience. Innovation in rural places may come about as a result of new forms of collaboration; policies that leverage rural assets and address critical service or product gaps; novel strategies for accessing financial capital; infusion of arts into aspects of community life; and cultivation of networks that bridge entrepreneurs, organizations, and institutions. The chapters illustrate how a number of innovation-related characteristics relate to economic vibrancy in rural places such as a strong connection to the arts, adaptive and sustainable use of natural resources, value-chain integrated food systems, robust bridging social capital networks, creative leveraging of technology, and presence of innovation-focused entrepreneurs. Through exploration of these and other topics, this book will provide insights and best practices for rural community and economic development scholars and practitioners seeking to strengthen the rural innovation ecosystem.

1Rural Innovation Redefined

Charlie French

DOI: 10.4324/9781003178552-1

Introduction

Communities across rural America face a plethora of socioeconomic forces that have contributed to their social and economic decline over the past several decades. Places once dependent on agriculture, forestry, and mining—as well as certain manufacturing subsectors like paper production—have been impacted by global economic forces such as cross-border trade, downward pressures on wages, and workforce automation (Ziliak, 2019). These and other factors have contributed to job losses in sectors that once predominated rural areas, resulting in population decline in many rural regions.

Transformations impacting rural America were greatly exacerbated by the Great Recession, as many of the jobs that were shed between 2007 and 2009 did not return. Adding to the plight of rural places is a global pandemic. While it is unclear what the long-term economic impacts of the COVID-19 pandemic will be on rural America, it will likely permanently reshape communities: the types of business and industry that survive and thrive in rural places, their sociodemographic makeup, how people access human and social services, and what opportunities abound for people of all ages (Mueller, Burow, Pofahl, Merdjanoff & Farrell, 2020).

Compounding these challenges is the fact that the median age is seven years higher in rural America as compared to metropolitan areas. This is attributed in part to brain drain, as rural youth are more likely to leave their communities post high school in search of opportunity than their more urban counterparts (Segel, Ross, Edwards, Braun & Davis, 2020). On the other end of the age spectrum, many older rural workers, as well as retirees with limited incomes, find themselves unable to leave their community or region due to lack of resources and social and familial networks in places where they might otherwise move to. This can put additional strain on their families, who often end up taking care of them, and it pushes to the brink the system of social and human support for aging rural residents.

Beyond the sociodemographic and economic challenges, rural America also faces human health and health care-related challenges. Epidemics like obesity, diabetes, and substance misuse hit people in rural places disproportionately harder than their urban and suburban counterparts. These issues are often exacerbated by the relative lack of access to health services in rural communities, many of which have lost their hospitals or health clinics due to consolidation in the health-care industry. Even if health services do exist in rural places, many individuals and families lack health insurance to pay for care (Cosby, McDoom-Echebiri, James, Khandekar, Brown & Hanna, 2019). It does not help that many rural places are situated in food deserts that have very limited access to affordable, healthy food. These factors together can lead to poor health outcomes in rural places.

Lastly, a growing digital divide is contributing to stagnant economic growth in large swaths of rural America. Although broadband access is expanding in some rural places, it is overall not keeping pace with broadband expansion in more urbanized places and there is a growing gap between rural and urban with respect to affordable broadband access. With slower relative upload and download speeds, rural places struggle to attract new enterprises, let alone retain existing ones, in sectors such as financial and legal services, communications, information technology, health services, and advanced manufacturing. Lack of affordable broadband access also limits learning opportunities for people of all ages and further reduces the likelihood that young people in rural communities will go on to college or gain the skills needed to secure good-paying jobs (Gallardo, Whitacre, Kumar & Upendram, 2020). Yet, it is not merely lack of broadband access that limits learning and career development opportunities but also lack of digital literacy in many rural, broadband-underserved places regarding how to use broadband and broadband-enabled applications.

Given the array of challenges facing rural places, it would be easy for state and national political leaders to write off rural America as not worthy of investment and instead focus resources and policies on urban and peri-urban areas. Yet, some scholars believe that rural America is perhaps more relevant than it has ever been since World War II. According to a recent Pew poll conducted after the start of the COVID-19 pandemic, rural places are experiencing a recent population influx as urban dwellers seek opportunities to settle in less crowded places, a reversal from decades of population decline. Young people and families appear to be moving to internet-connected rural places, bringing with them a wealth of talent, ideas, and new enterprises. While it is unclear if this trend will continue, it has raised hope for many rural communities.

Furthermore, rural America continues to play a critical role to the growth and sustenance of the country by continually adapting to economic social change: it remains the breadbasket of the nation’s food supply, it supports a multitrillion dollar recreation economy, it provides ecosystem services necessary for sustaining life like clean air and water, and it is home to around 60 million hearty residents. Rural places across the United States have figured out how to adapt to continual change and innovate in unexpected ways that make them more vibrant and attractive to people and to businesses, as well as more resilient to social, economic, and environmental change.

The question that has long intrigued rural scholars is what makes certain rural places adaptive and resilient? Part of the answer to that question is innovation: that creative milieu that is brought to life as people work together across sectors to find creative solutions to problems and adapt to change. In this book, we discuss the various forms of innovation, how they manifest themselves in rural places, and how communities can cultivate a system of supports that enable innovation and entrepreneurship to thrive, ultimately leading to community resilience (Thiede, Greiman, Weiler, Beda & Conroy, 2017).

Characterizing Rural Innovation

Throughout human history, rural places have undergone dramatic changes emanating from an array of events and phenomena such as the introduction of new technologies, changing resource consumption patterns, ever-increasing global interconnections, natural and human disasters, new discoveries, changing natural resource demands, and socioeconomic shocks. Despite the torrent of forces continually exerting pressure on rural places, some have demonstrated their resilience time and time again by bouncing back from adversity.

A key attribute that distinguishes thriving rural places from those that run the risk of becoming economically stagnant and lacking in vitality is their ability to adapt to change and overcome adversity by working across sectors to leverage assets and resources in innovative ways to tackle problems and capitalize on opportunities. Innovation is one of the most important ingredients to forging resilient, thriving rural economies (Lichtenstein & Lyons, 2010). Without innovation, rural communities lack the tools and resources to adapt to socioeconomic forces of change or disruptive events and shocks such as the loss of an industry or a natural disaster.

The term “innovation” is used in this text in a community context to refer to the introduction of a new idea, method, technology, or system that adds economic or social value to the people, institutions, organizations, or businesses residing in a place such as a city, town, or region. We refer to this form of innovation as place-based innovation, as it occurs when people in a community or a place draw from local resources, ideas, and talent—often borrowing from solutions or ideas implanted in other places—to generate alternative approaches to addressing community problems and capitalizing on opportunities (Maddock, 2010).

So much emphasis in the literature has been placed on innovation in the business sector, but we assert that innovation can emanate from any sector in a community or a geographic place. For instance, innovation may be introduced by community decision-makers seeking to manage public works more effectively and efficiently; by a nonprofit organization seeking to adapt its service delivery model in a new way to reach underserved clients; a group of local residents seeking more effective ways to engage people in community action, or by a social entrepreneur seeking a groundbreaking approach to effecting societal change around systemic issues like poverty and public health. Innovation can indeed emerge from any individual or group of individuals working together to solve a problem or create economic or social value. What brings innovation to life in rural places is the system of supports that help communities, entrepreneurs, civic and municipal leaders, and others come together to solve problems and add value in new and creative ways. We refer to this system as the “Innovation Ecosystem,” which will be discussed in depth in Chapter 3.

While the focus of this text is on innovation at the community scale, it draws on the field of business innovation to characterize distinct forms of innovation that impact rural places. The following are four types of innovation that manifest in rural places:

• Sustaining innovations comprise a significant improvement(s) to a product, service, or social enterprise to ensure that it is still relevant to those benefitting from it such as a community’s or organization’s adoption of an emerging web-based technology platform to enhance connections with stakeholders.
• Incremental innovations entail gradual improvements to a product or service over time such as continual changes to policies that incorporate web-based tools for holding virtual public meetings to make them more accessible to the public.
• Disruptive innovations are those that introduce a new way of delivering a product or service by incorporating a new technology such as the development of a novel, ubiquitous, web-based platform for social networking.
• Radical innovation is what gives birth to a whole new way of solving problems and providing value, often by creating a new market. An example is the formation of Grameen Bank, which forged a new financial model for providing critical microcredit to rural poor around the world.

Lastly, we incorporate a fifth distinctive form of innovation that bears relevance to rural places: social innovation. Social innovation refers to the process by which civic, social, environmental, and other leaders work across sectors to develop solutions to systemic issues such as poverty, homelessness, inequities in education, or climate change. The goal of social innovation is to meet human and social needs more effectively than existing solutions. Furthermore, social innovation can occur at any scale, from local to global. An example of social innovation is how the Mayor of a struggling upstate New York town created a new financial mechanism to enable people to invest in—and ultimately own a stake in—revitalizing Main Street buildings. This model of community capital helped to revive the community. We argue that social innovations like this are prevalent in rural communities, simply because rural places are continually challenged to adapt to socioeconomic and other forces of change.

While there are no doubt examples of disruptive and radical innovation in rural places—particularly considering that electrification, telephony, and mechanized agriculture are three groundbreaking innovations that helped shape rural America in the last century—the contributions to this book focus largely on sustaining, incremental, and social innovations because they often go underrecognized and underappreciated. Yet, they are critical to rural community vitality. Sustaining, incremental, and social innovations in rural places may come about as a result of new forms of collaboration; adaptive policies that leverage rural assets and address critical service or product gaps; novel strategies for accessing financial capital; creative infusion of the arts into diverse aspects of community life; or the cultivation of knowledge and resource networks that bridge entrepreneurs, organizations, and institutions.

Debunking the Myth that Rural Places Don’t Innovate

What distinguishes this book from other scholarly works on innovation is our primary focus on rural places. We do so because the vast majority of scholarly literature focuses on innovation in and around urban places with dense clustering of firms that facilitates knowledge spillover, greater relative access to financial capital, large relative pools of educated or skilled labor, presence of postsecondary research institutions, and strong public support for research and development. Moreover, the body of research on innovation as an economic driver tends to focus on disruptive and radical innovation—the rare breakthrough innovations that have relatively large economic impacts—but fails to characterize the smaller-scale, often subtle forms of innovation that occur frequently in rural places.

The so-called “innovation gap” between rural and urban places—the notion that the per capita rate and volume of innovations emanating from urban places exceeds that of rural places—is partly skewed because the specific indices of innovation commonly measured and cited in the literature by think tanks and academic institutions are at a scale that is not conducive to rural places such as venture capital investment, rate of commercialization of intellectual property, rates of job creation in emerging industry sectors, and number of patents. By and large, rural places do not have access to the scale of resources or infrastructure needed to enable the above activities, at least at the same level as urban places. Thus, there is an inherent measurement bias towards urban places that have the infrastructure and resources to spawn disruptive and radical innovation. The resulting picture is one that fails to recognize the unique forms of innovation that take place in rural places.

Yet, rural places do innovate, and many are thriving as a result. In fact, a number of innovation-related characteristics and practices correlate to economic vibrancy in rural places such as the positive relationship between the presence of art-focused institutions and local economic performance (Wojan & Nichols, 2018), higher relative economic performance in rural places that leverage recreational assets (García-Sánchez, Siles & Vázquez-Méndez, 2019), and linkages between economic vibrancy and the presence of value chain integrated food systems in rural places (Barrett, Reardon, Swinnen & Zilberman, 2019).

That is not to say that all rural places across America have been able to successfully leverage innovation to thrive and remain resilient. The economic reality is that many rural communities—even those with effective leadership and creative and engaged individuals, businesses, and institutions—continue to struggle because of factors that are out of their control such as national trade policies, geography, and the onset of human and natural disasters. Likewise, it would be inaccurate to say that there is not an innovation gap between rural and urban places. Overall, urban and suburban places economically outperform rural places with respect to wages, num...