This thesis makes a comparative study of local government autonomy in Britain and Sweden within the local economic development policy area. It argues for local government autonomy to be viewed in terms of both a vertical dimension concerning local government's autonomy vis-à-vis national government (national context) and a horizontal dimension relating to its autonomy vis-à-vis local social and economic forces (local context). A policy area approach is advocated as the strength of, and the balance between, factors influencing local government autonomy, both vertically and horizontally, may be modified by the particular characteristics of the policy area. For example, the local economic development policy area is characterized as a grey zone respecting the intergovernmental relationship and a "mixed-economy" concerning the public-private sector relationship. The concept of autonomy is distinguished into policy-making independence (measured as local authority cooperation with other actors in economic development policies) and capacity for action (measured in terms of four local authority roles in the local economy). These are tested empirically regarding the influence of the local context and the relationship between them examined. The dominant trend in both countries is that the more local authorities intervene in the local economy (extend their capacity for action), the greater their cooperation with other actors (the more restricted their policy-making independence). / digitalisering@umu