Bridging the Functional and Territorial Rationales—Proposing an Integrating Framework for Regional Dynamics

In identifying and enacting roads to sustainable development in welfare states, several divides fragment the research community as well as the public policies being practised. First there is a major gap between what might be addressed as a functional and a territorial rationale. The former is supported by those who in the name of national development propose a concentration of efforts to advanced and boundary-spanning innovation systems, staged as resourceful coalitions between private business, policy-makers and the universities as major knowledge-creators. A territorial rationale in contrast withholds that the power of development is nested into the local community, its committed member firms and other stakeholders as a collective. The outcome of an analytical inquiry into the construction of these contradictory discourses is integrated into a three-dimensional model. These dimensions are: the dominant life-setting in the territory (place), the general outlook of the people in the locality/region and the critical competence needed to materialize ideas that emerge in the context. Based on our earlier research we then frame theoretically and illustrate empirically the argumentation in two Swedish territories, the industrial district (Gnosjö) and an urban area (Gothenburg). Finally we propose that the very bridging of these rationales or rationales both analytically and in practice build a dynamic foundation for territorial development. This suggests the need for upholding an ongoing dialogue between contrasted rationales along each proposed dimension. The paper concludes with the implications of this view for public policy concerning localized business activity.