Economic performance in a socially diverse district. Opinions of local entrepreneurs

Abstract

The paper attempts to answer the question how social diversity of one of Warsaw’s 18 districts, Praga Północ, plays a role in the area’s economic performance. With an ongoing gentrification process, Praga Północ is changing at fast rate, with islands of modernisation appearing in the ocean of its traditional social tissue. The local community was once dominated by lower class inhabitants, with typically low income and secondary education, that had relatively low expectations with regard to local market and quality of products and services. At present, the area is more socially diverse, as new middle class citizens live here, due to new housing investments and the establishment of creative firms. The situation in Praga provides a unique possibility to research the impact of the area’s rapid social change on local economic performance. We investigate strategies undertaken by existing enterprises and newly-founded ones when facing a growing diversification of potential clients. We describe the wide spectre of activities undertaken by business owners and point to dominating trends and outstanding business behaviours. The study is also a specific experiment, that allows to verify theoretical assumptions on the basis of local knowledge with special focus on the impact of social diversity on economic performance.