Many resource-rich, rural communities in the U.S. are stressed by poverty. Communities that once relied on their forests, bays, ocean shores, or mineral lodes for a steady and dependable source of employment and income are seeing jobs disappear as the resource becomes costlier to harvest, or shifts in markets and technology make their resources obsolete. Without the ability to substitute manufactured capital -- machines, buildings, learned skills -- for their bounty of natural capital, a community's reliance on the stock of natural capital becomes more critical. When communities expend their capital stock, or it no longer satisfies an exported demand, their economies suffer.

As communities grapple with the issues of redevelopment and economic revitalization, they are reminded of the importance and value of their stock of natural resources to their livelihoods and way of life. In many communities people have expressed their desire to retain their rural identity and to protect the resources that have in the past provided them with income. They discover new ways of capitalizing on their endowment of natural resources to bring in jobs and income. Many communities are using the notion of sustainable development to guide growth and economic improvement.

Ecologically sustainable economic development is a concept being adopted as a guide to policy making in the U.S. At the local level, Northampton County, Virginia has embarked on an initiative to identify and promote sustainable development activities on Virginia's Eastern Shore (Smutko, Danielson, and Johnson, 1993).

Sustainable development is a conceptual tool using economic and ecological principles to guide economic growth and improvement. A social-environmental movement formalized by the Bruntland Commission in 1987 (WECD, 1987), sustainable development was conceived in response to developing countries' reliance on commodity exports for foreign exchange and the environmental degradation that commonly results from over-exploitation of their natural resources. At this level, national accounts, world markets and GNP measures of national welfare are the operable maxims of sustainable development. If communities and sub-state regions in the U.S. are to adopt sustainable development principles, the challenge becomes one of converting concepts of foreign trade and national accounts to the local level, i.e., creating a regional sustainable development concept.

Sustainable development concepts conceivably can be applied at any scale. However, there are problems with adapting them to a regional level. Traditional analysis of sustainable development concerns itself with closed economic and ecological systems. In these systems, flows of resources, goods and services, labor and technology are endogenous. By contrast, regional (as opposed to global) systems are open; resources and wastes commonly cross regional boundaries. Sustainability is essentially imported, and unsustainability is exported. This makes analyses of regional sustainability difficult. If one community chooses to convert its wetlands and other wildland habitat into condominiums and boutiques, and another chooses to maintain its resource base intact for the values it offers, is the former community violating precepts of sustainability? Is the latter on a "more sustainable" path? If cross-boundary flows of goods, wastes, services and people are not restricted, as is typical of U.S. communities and regions, is sustainability of the region's economic and ecological systems an issue? In the analysis of regional sustainability, concepts such as scale, characteristics of the resource, and characteristics of the regional economy, are all relevant.

Defining a concept of regional sustainable development introduces other problems related to measurement. Movement toward the goal of regional sustainability implies that the region's environmental, economic, social, and cultural attributes remain sufficiently intact to enable perpetuation of the regional system. Hence, indicators need to be devised to measure changes in the state of these attributes as communities and regions grow and change.

Communities are constantly faced with choices among economic development alternatives. Capital investment by government and the private sector has long-term consequences. If communities are to strive toward more sustainable development paths, they need a method of comparing development alternatives within the framework of the sustainability concept.

The intent of this study is to develop an operational model to guide communities and regions in their development decisions. Specifically, the methodology developed here is a comparative analysis of regional economic development alternatives with respect to the degree of sustainability each achieves.