Gallatin County is undergoing rapid economic and social change. We are home to increasing numbers of high-tech and biotech start-ups. Our population grew 50 percent from 1990 to 2004, far outpacing national growth of 18 percent.

This is not the case in all rural areas; many regions face diminishing opportunities and populations. And those fortunate enough to grow suffer problems of their own.

In June, the Foundation for Research on Economics and the Environment explored some of these issues at a three-day seminar titled Entrepreneurship, Telecommunications, and Social Change.

Whitman College environmental studies professor Don Snow described what’s happening as the merger of rural and urban places into what he calls “rurbia.” This is not just the growth of cities into their rural hinterlands; it’s a regional phenomenon, affecting large areas, and dependent on the surrounding countryside. It often manifests as a kind of spontaneous formation of cities based on amenities.

Arnold Kling, an economist and regular contributor to TechCentralStation.com, pointed out that this is simply economic growth, driven by technological change. Yellowstone Public Radio’s Ken Siebert reported that many locals think “we were doing just fine before you guys came” and don’t see the benefits of such growth.

Describing the newcomers, Montana State University political scientist Jerry Johnson argued that people aren’t moving to rural areas for a sense of community. They’re moving here to be left alone; their communities are in cyberspace.

Bob Thompson, former director of rural development at the World Bank and currently at the University of Illinois, explained how no country has solved the problem of rural poverty through agriculture alone. Rural-urban migration is essential, but easily overdone. It must be attractive and viable for rural families to remain in rural areas.

Thompson believes the only solution to rural poverty is to create nonfarm employment in rural areas. One way to encourage this is to invest in human capital and infrastructure: improve rural schools, health care, and Internet access. If you don’t have broadband access, you don’t have a chance of getting on the first rung of the ladder, particularly in rural areas.

MSU’s Richard Wolff, holder of the Gilhousen Telecommunications Chair, noted that the penetration of high-speed connections in the U.S. is about 25 percent; in South Korea it’s 75 percent. Further, 16 percent of Montana zip codes have no Internet service provider.

Dr. Karl Stauber, president of the Northwest Area Foundation, pointed out that rural communities have high “bonding” social capital, that is, they work well with their neighbors. But they don’t have high “bridging” social capital, which is required to compete in a global market. What helped these communities survive in the past will cause them to fail and fade now.

Stauber noted that opportunities are not equally distributed across geography; governments can and do change the distribution of opportunity. He argued that for government economic development to be most successful it must be aligned with current or future market opportunities. Policies must focus on building new competitive advantage, not protecting old competitive advantages.

But as PERC’s Jane Shaw pointed out, this is problematic. Governments are poor predictors of the future. For example, Bozeman’s start-up growth happened largely under the radar, unplanned. Likewise with Silicon Valley’s transformation from orchards to microchips, or the growth of organic farming.

Stauber agreed that you can’t plan these things, but you can provide incentives or penalties. Rather than planning economic development, governments should create an environment where the right things happen, that is, foster entrepreneurship. Land grant universities happened because at that time the one thing the government had in surplus was land. Today what it has in surplus is information. Yet none of our land grant universities have colleges of rural development.

Whitman’s Don Snow brought up the nonprofit entrepreneur. These entrepreneurs try to balance market forces. Nonprofits in the West work to protect natural capital and the attractiveness of places. How might these “protectors of values” join with business entrepreneurs?

George Mason law professor Steven Eagle believes that change is ultimately a problem of collective action, balancing individual versus group rights. One consequence of giving primacy to individual rights is that we lose the “rootedness of place.” The creative destruction of free-market capitalism is fine -- if you’re on the creative end.