Economic Dynamics as a Factor of Local Development

Abstract

This article resorts to the Local Economic Dynamism Index (INDEL) as an alternative for better understanding local economic dynamism by perceiving the relative potential for retention of wealth generated by the economic system. This effort is justified by the degree of heterogeneity of these systems, especially the nature of capital inflows. Economic systems that benefit from investments based on natural resources tend to allow significant wealth outflows due to their limited capacity to absorb positive externalities. To investigate the pattern of absorption capacity for internally generated wealth, four municipalities in the North Fluminense mesoregion were selected for the application of INDEL: Campos dos Goytacazes, Macaé, São João da Barra, and São Francisco de Itabapoana, which present distinct characteristics and offer opportunities for meaningful analysis.