Governance, institutional capacity and partnerships in local economic development: theoretical issues and empirical evidence from the Humber Sub-region

Recent research on local and regional economic development has focused upon transformations in local governance and institutional capacity. It has been argued that local authorities have ceded power to other actors and institutions involved in economic development and regeneration, and that the success of local and regional economic development is closely related to the strength of 'institutional capacity' within an area. In this paper, we examine these claims with reference to the operation of EU Structural Funds in the Humber Sub-region of the UK. Previous research on local governance and institutional capacity has had a limited empirical focus, drawing conclusions from studies of either economically 'successful' regions or regions undergoing regulatory and institutional transformation and precluding analysis of the nature and conditions of local governance and institutional capacity in less developed regions. Our case study evidence not only suggests that arguments about the declining influence of the local state are overdrawn, but also indicates a need for more nuanced accounts of the role of institutional capacity in regional development.