In lieu of an abstract, here is a brief excerpt of the content:

6 Although the innovation cluster is an important example of a developmentalist approach to the green transition, there is a second approach associated with a different type of green businesses than those in the technology sector and those in the clean tech clusters. Small independently owned businesses in sustainable agriculture, building services, community finance, and green retail often operate with different business models from those of the high-tech businesses of the regional innovation clusters. The contrast between the two types of business is based on different financing mechanisms and associated business goals. The typical business in a green innovation cluster is a start-up venture that is on its way to becoming publicly traded or being sold to a large corporation, or it is an initiative within an established company that has identified a new market opportunity. In either case, proponents must convince their patrons that the business venture will have a high growth rate that will generate a high return on investment within a short time. Innovators tend to depend on patents that can protect their strategy of bringing a new product to market, and these new business ventures tend to be broadly in the technology sector. In contrast, many small businesses outside the sector of technology start-ups don’t rely on venture capital or related forms of funding that are based on the expectation of rapid growth. Instead, the small businesses in retail, agriculture, and services are often funded with loans from family and friends, and they are privately held companies with a limited number of owners. They don’t have a plan to grow rapidly with the goal of a liquidity event that rewards their investors with a high annualized rate of return. Instead, they grow much more slowly through the reinvestment of profits. Because of the higher level of autonomy from outside investors, these “independent” companies Localist Alternatives to the Mainstream Transition 148 Chapter 6 have a greater ability to pursue goals that may include community benefit, social fairness, and environmental sustainability. Although the privately held, independent business is the primary vehicle for the alternative model of economic development, other organizational forms include the small nonprofit organization, the public benefit corporation, the cooperative, and the local public enterprise. Together with small independent businesses, this group of organizations plays an important role in the greening of the economy, and it represents a large proportion of overall jobs and job creation. However, the sector is often overlooked in discussions that focus on the bigger businesses and start-up enterprises of the green innovation clusters. In discussing the alternative pathway in the green economic development field, it is helpful at the outset to dispel possible misinterpretations that sometimes emerge. Some advocates of small green businesses and other organizations argue that a complete transition to green energy would require that most of the economy consist of such organizations. If one includes social fairness and democracy goals in the definition of a complete and successful green energy transition, then there is some point to the argument. However, the argument is more difficult to defend if the idea of the green transition is limited to a technical goal such as shifting to a low-carbon economy. The idea that organizations with slow economic growth are environmentally more benign is problematic because a green energy transition requires rapid growth in some industries and “degrowth” in others. Thus, the high-tech model of venture capital, entrepreneurial start-ups, and the “banana” curve of rapid growth is desirable in some industries, such as solar energy, provided that they are displacing industries such as coal. Because coal has a larger ecological footprint (due to greenhouse gases and mountaintop removal) than solar, the net effect of rapid growth of solar can be a reduction in overall ecological damage. A second misinterpretation occurs with respect to the association among ecological footprint, localization, and the small businesses of the service, retail, and food sectors. The argument appears primarily with respect to food, namely, that locally produced food has a smaller carbon footprint than nonlocal food because there is less carbon embedded in transportation of local food to markets than for distant food. Although the argument has some merit, there are many intervening variables. Food grown in a greenhouse in the winter that is heated with natural gas and has electricity powered by coal may have a larger carbon footprint than equivalent food grown under the sun in a warm climate and shipped by [18.191.216.163...

Share