Harvey, David (1989), “From Managerialism to Entrepreneurialism: The Transformation

in Urban Governance in Late Capitalism,” Geografiska Annaler B. 71: 3-17.

General Remarks

David Harvey has been one of the most influential figures and prolific writers in
Geography. In fact his influence goes much beyond our field – he is also well known in
Sociology and Anthropology. This 1989 article of Harvey’s is, in a sense, a prelude to
one of his very most influential volumes, The Conditions of Postmodernity (1989,
Blackwell), which has formed the basis for a whole generation of work on the urban built
environment. Harvey visited our Department last June and gave two seminars in our
University.

In this paper Harvey notes that beginning from the mid 1970s (more specifically the 1973
Oil Crisis) onwards urban governance (which includes but is not restricted to urban
government) has become increasingly preoccupied with the exploration of new ways in
which to foster and encourage local development and employment growth. This trend
towards “entrepreneurialism”, as Harvey terms it, is in stark contrast to the
“managerialism” of the era of the welfare state of the earlier decades in which urban
governments were preoccupied with their redistributive role, i.e., the local provision of
services and facilities to urban populations.

Harvey argues that this fundamental shift in the philosophy and practice of urban
governance is related to changes in the macro-economy. In particular the globalization
process has brought with it increasing instability, as manifested in the de-
industrialization of certain areas of the former industrial core and the declining power of
the nation-state to control multinational capital flows, that forces urban governments to
take a more pro-active stance. The gradual penetration of post-Fordist mode of
production or flexible accumulation also has a role to play.

Governance and Government

In analysing the nature of urban entrepreneurialism, Harvey points out that it is important
to specify who is being entrepreneurial and about what. Here Harvey uses the term
“governance” rather than “government” in that urban entrepreneurialism goes beyond the
latter. More specifically, he argues that the power to organize space derives from a whole
complex of forces mobilized by diverse agents.

Formation of coalition politics underlies much of urban entrepreneurialism: local

chamber of commerce, local financiers, industrialists, property developers, etc. Such
coalition tends to be fluid and takes on various forms. Personality, particularly the
availability of charismatic figures, could have a significant part to play, exerting
profound influence on the exact form of the coalition and hence the direction of urban
entrepreneurialism.
Public-private Partnership

Public-private partnership, in which a traditional boosterism is integrated with the use

of local government powers, has been a celebrated form of urban entrepreneurialism as
this is often associated with job creation and the injection of scarce financial resource for
the undertaking of urban infrastructure development and face-lifting projects for the city.
Examples of public-private partnerships include new civic centres, industrial parks,
waterfront development projects, etc. In the case of Hong Kong, perhaps one of the
most controversial public-private projects is the Cyberport. Another equally celebrated
example is the Hong Kong Disneyland. There are older examples: the container ports in
Kwai Chung and Tsing Yi, the Hong Kong Convention and Exhibition Centre, and the
three industrial estates.

Harvey argues, however, such public-private partnership could be a source of urban

instability and malaise. In particular, public-private partnership projects are inherently
speculative in execution and design as the risk is to a large extent borne by the
“public”. These projects contribute to the problem of over investment and over
accumulation and therefore the periodic crisis characterizing capitalism. In the urban
realm they act as barriers to rational planning and coordinated development. Moreover,
such projects are concerned with construction of place (the image of a specific place)
and the enhancement of property values rather than the amelioration of conditions
(housing, health, poverty, etc) of the territory (or city) where the place is located.

Forms of Urban Entrepreneurialism

1. Creation of particular advantages for the production of goods and services. The
locality often offers to the investor a substantial package of aids and assistance (e.g. low
cost land, tax haven, etc) as inducement. Also the local government may invest heavily in
the provision of trained personnel and skill labour. While there are cases in which careful
attention to the industrial and marketing mix backed by strong local state action can
engender agglomeration economies and bring about rapid economic growth, cases in
which such initiatives are ill-conceived resulting only in draining of the locality’s
resources, are many times more frequent.

2. Investments to attract consumption dollars, such as projects to attract tourists and

retired people. This is to transform the city so as to make it an innovative, exciting and
safe place to visit, to play, and to consume. Gentrification, cultural innovation (the
promotion of the city’s heritage, for instance), consumer attractions (convention and
shopping centres), entertainment, etc have become more prominent facets for urban
regeneration. Spectacles and display are all symbols of the city’s dynamism.

3. Struggle over the acquisition of key control and command functions in high
finance, government, and information processing, or, in short, the context for the world
city status. Thus we see massive investments in new airports and telecommunications
facilities. Also premium is given to certain kinds of education, namely, business and law,
media skills, high-tech production, etc.

4. Coalition between the local government and local business to strive for central
government subsidy and investment.

Inter-city Competition and the Creation of Post-Modern Landscapes

Urban entrepreneurialism implies mounting inter-city competition. This, in turn, exerts an

external coercive power over individual cities to conform to the discipline and logic of
capitalist accumulation. A consequence of this is to render a certain degree of uniformity
to all cities: the provision of good business climate.

However, with the diminution of transport and communication costs, the significance of
the qualities of place has been enhanced. For a given city, this often is associated with a
renewed interest in the city’s past or heritage and the cultivation of a physical setting
and cultural milieu that distinguish the city from others. “Local coalitions have no
option .….. except to keep ahead of the game thus engendering leap-frogging
innovations in life styles, cultural forms, products and service mixes.” (p. 12) In this
sense, then, there is a clear connection between urban enterpreneurialism and the
development of post-modern architectures and urban forms. “The orchestrated
production of an urban image can, if successful, also help create a sense of social
solidarity, civic pride and loyalty to place.” (p. 14) However, “concentration on spectacle
and image rather than on the substance of economic and social problems can also prove
deleterious in the long run.” (p. 16)