Maine's VC funding
Tuesday, January 04, 2005 Maine is seeing a revival of its venture capital investments. The total remains small, but trends tell the story. Read more. posted by Ed Morrison |
Stuck on a golf course Public officials in Anne Arundel County, Maryland are about to get a haircut: about $26 million to bail out a golf course.
It's a story of twisted public policy, a misguided state agency, and some slick lawyers. According to one public official, the county had been "duped by some city slicker lawyers...What they couldn't do by the front door, they did by the back door."
Read the sad tale of a county that got suckered. It's a cautionary tale of how you can risk your bond rating without knowing it. posted by Ed Morrison |
Vision of a technology corridor in the Black Hills In the Black Hills of South Dakota, EDPros are studying the emerging technology corridor around Oak Ridge, TN. (EDPros in Eastern Tennessee recently launched a branding of their region as Innovation Valley.) They see the opportunity to develop a similar technology corridor around a proposed national underground laboratory. Read more. posted by Ed Morrison |
University of Florida joins high tech council The University of Florida has joined the Florida High Tech Corridor Council. The University has pledged $2 million a year in the Council's applied research program. The program conduct research in industries targeted for growth – aviation & aerospace, information technology, medical technology, microelectronics, modeling, simulation & training, and optics & photonics. Read more. Visit the Council web site.
(Just to put this in perspective, the university's commitment to the Council is at the same level as their commitment to the new football coach, Urban Meyer, who will be paid $14 million over seven years.) posted by Ed Morrison |
Saturday, January 01, 2005 Here are the best articles on the economy that I came across last week.
America’s coming economic changes
America cannot postpone bringing education into the 21st century
Vital Signs for the Week of Jan. 3
U.S. forecasters see a banner 2004 followed by slower growth in 2005
How the 2005 economy could affect Bush's big plans
posted by Ed Morrison |
Predictions for 2005 Predictions are always a tricky business, but they're fun to think about. Here's what I expect to see in economic development in the coming year.
Awareness of the skills gap will start to sink in:
We face a basic imbalance in our workforce system. Baby boomers are retiring, and we are not producing enough skilled workers with post secondary education. (Too many kids are dropping out of high school, and too many kids are graduating from high school with weak skills and no career plans.) So, the skills gap is growing. Here's an example from Akron. Here's another from Michigan.
More regional partnerships:
An increasing number of EDPros will recognize that the future lies in regional alliances. The reason is simple: In a global world, no one can afford to go it alone. It is only within a region that businesses can find the brainpower and innovation networks they need to be globally competitive. We'll continue to see our share of regional initiatives undercut by silly considerations like old high school football rivalries, but overall, more EDPros will figure this out.
Growing backlash against incentives:
The $250 million deal for Dell will raise questions in North Carolina, just as the $3.2 billion Boeing deal has done in Seattle. (That deal may have to be reworked if the World Trade Organization intervenes.) The Ohio federal appellate decision will embolden incentive critics, and you can expect bi-partisan efforts, like this one, to reduce subsidies to companies.
More focus on incentive accountability and "clawback provisions":
Increasingly, state and local governments will be negotiating tougher incentive agreements. In part, the move will be defensive. In an era of tight government budgets, no political leader will want to appear "soft" on an incentive deal. At the same time, state legislators will be pressing for more accountability, like this legislation recently passed in Ohio.
More emphasis on entrepreneurship:
Rural areas, especially, are gradually learning that entrepreneurship offers the best pathway to higher prosperity. Business recruitment -- long the single strategy in many places -- has begun to play itself out. Here's an article from Georgia that makes the point.
A new focus on innovation:
Manufacturing is not dead in this country, nor will it be in our lifetimes. But successful manufacturers will be those who innovate with new product and process improvements. Prompted by the new report InnovateAmerica from The Council on Competitiveness, we should begin to understand that innovation represents our best answer to globalization.
More international partnerships:
The weak dollar will help us wake up to the opportunities in the global market. More communities will be following the lead of places like Hampton Roads, Fairfax County, and Tucson in developing innovative global partnerships. The regions that will be ahead of the curve on this trend will see their efforts as building global innovation networks.
Growing visibility for sustainability:
The high costs of sprawl will start to bite local and state budgets even harder. In some regions, water shortages will push sustainability issues to the front. Finally, a backlash against Big Box retailers -- particularly Wal Mart -- will raise questions about what economic development really means. At the same time, sustained high oil prices will lead to new markets in alternative fuels -- biodiesel, ethanol, wind -- and the growing realization that elements of a hydrogen based economy are likely to emerge in ten years or so.
More aggressively entrepreneurial colleges and universities:
Across the landscape of economic development, an increasingly assertive leadership among our colleges and universities is leading to new roles in economic development. Soon, we can hope, state legislators and Congress will wake from their slumber to discover the critical role our colleges and universities play in our international competitiveness. Learn more.
The emergence of creativity as an economic development driver:
Regular readers of EDPro News know that I'm no fan of Richard Florida. And this trend has little to do with his theories of "the creative class". Rather, this trend emerged in Europe several years before Florida wrote his book. This ttrend is rooted in the deep connection of creativity to innovation. This trend also focuses on the emergence of digital media and the convergence of entertainment and education.
Blurring lines between economic development, workforce development and tourism development:
Profvessionally, we all grew up at a time when the boundaries separating these fields were clear. Increasingly, though, we will see professional bridging the gaps. Communities that foster these conversations will move ahead with a shared understanding: In this era of global competition, we're all in the same boat.
New focus on our backyard:
More EDPros will do the math and start pushing ahead with retention and expansion initiatives. Here's an example from Enterprise Florida. The big leap -- and we might not be ready for it yet -- will come in realizing that solid "retention and expansion" initiatives are really innovation initiatives. As Michael Porter points out there's no such thing as high tech or low tech industries...only high tech or low tech companies. (In fact, if we're lucky, we'll ditch the term "retention and expansion" altogether.)
Tighter scrutiny on marketing budgets:
Economic development money is no longer free, and the recruitment game will come under tighter scrutiny. Business, media and political leaders will continue to look for more accountability and metrics. As the economic development zeitgeist shifts to workforce, innovation and entrepreneurship, more people will wonder whether marketing budgets should be so large.
posted by Ed Morrison |
EDPro's 2004 Tirebiter Award
EDPro's 2004 Tirebiter Award award goes to Senator Charles Grassley of Iowa.
Some of you will recall that Senator Grassley managed to put $50 million into an appropriations bill to build a rainforest in Iowa...all in the name of economic development. (Looks nice, don't you think?)
This was happening as the Congress cut about the same amount from the budget of the Manufacturing Extention Partnership that helps small and mid-sized manufacturers meet the challenges of globalization.
The project has even spawned its own blog: Iowa Pork Forest. Here's an update on the project
The Tirebiter award is given in honor of George Leroy Tirebiter. Mr. Tirebiter was the Surrealist Party candidate for Vice President in 1976. posted by Ed Morrison |
EDPro's list of the best innovators of 2004 Here's a review of the best developments of 2004.
Pennsylvania: for a range of initiatives including the Keystone Innovation Zones, a manufacturing initiative, and "growing greener" initiative, a new angel investor program, and a serious effort at state tax reform
Michigan: for "Cool Ciites" initiative, support for the tool and die industry, an interesting initiative to connect foundations to economic development, and an effort to streamline state permitting.
South Carolina: for serious efforts to develop a new model of economic development based on knowledge businesses, a new initiative on health research, an emerging strategy to coordinate tech schools, and the new research campus at the University of South Carolina.
Minnesota: for the innovative role its foundations have taken in economic development and its e-commerce certification program
Louisiana: for making progress on a serious economic development strategy, arguably for the first time in state history
Arkansas: for examining the role of higher education in the state's economic development.
Texas: for its innovative deal with Texas Instruments in Dallas
West Virginia: for its grid computing initiative
Ohio: for its Third Frontier network
Georgia: for its certification program to promote entrepreneurship networks in communities
Research Triangle: for developing a new strategy to carry it to the next level of development
Triad region in North Carolina: for finally coming together to act as a region
Western North Carolina: for building strong innovation and entrepreneurship networks
Capital Region in New York: for continuing to build the foundations for a knowledge-based economy
Philadelphia: for its efforts to build a stronger region, encourage innovation, and build networks to retain students
Kalamazoo: for its efforts to build an innovation and entreprneurship network
Leading international network innovations
Fairfax County: for its connections to Indian and Israel
Iowa: for exploring connections in New Zealand in biosciences
Hampton Roads: for connecting with Bremen, Germany
Tucson: for building connections to Canada
Triad region and the vice chancellor for research and economic development at North Carolina A&T: for developing research alliances with Indian Institute of Technology, the leading technology university in India posted by Ed Morrison |
EDPro's list of the best reports of 2004 Here's a list of the best economic development reports I came across in 2004.
InnovateAmerica by the U.S. Council on Competitiveness
2004 Best Performing Cities by the Milken Institute
Investing in a Better Future: A Review of the Fiscal and Competitive Advantages of Smarter Growth Development Patterns by Brookings
Development Report Card of the States by the Corporation for Enterprise Development (CFED)
Early Childhood Development: Economic
Development with a High Public Return by the Minneapolis Fed
The Productivity Argument for Investing in Young Children by the Council for Economic Development
Manufacturing's Performance and Prospects by the National Governors Association
Public Schools and Economic Development report by The Knowledge Foundation
The Policy Shift to Good Jobs by Good Jobs First
National Report Card on Higher Education by The National Center for Public Policy and Higher Education
Advancing Vermont's Creative Economy by the Vermont Council on Culture and Innovation
Metro and State Competitiveness Report 2004 by the Beacon Hill Institute
America's Biotech and Life Science Clusters by The Milken Institute posted by Ed Morrison |
Developments in downtown St. Louis
Wednesday, December 29, 2004 St. Louis is approaching $3 billion in new investment downtown. EDPros are hoping the they have reached an inflection point where the development cycle will start to accelerate. Learn more. posted by Ed Morrison |
The changing landscape of manufacturing Niche manufacturing and stronger exports represent the themes for manufacturing development in Maryland, as the global landscape changes. Some observers see the future in manufacturers that are "pretty small or pretty unique and can't be replicated by the Chinese."
The closure of a GM assembly plant is causing people to reassess the future of manufacturing. The message: the manufacturers that are surviving rely on innovation. Read more (Free registration required.) posted by Ed Morrison |
Evaluating Minnesota's JOBZ initiative
Monday, December 27, 2004 Minnesota's JOBZ program has increase the number of businesses that receive tax incentives by a factor of ten. There's still no practical, political consensus whether this approach works.
The economic evidence that these subsidy deals work is flimsy, but they can be politically popular. Read a review of the Minnesota program. posted by Ed Morrison |
A glimmer of daylight for the Iowa Values Fund Prospects for the Iowa Values Fund have brightened. The state Supreme Court derailed this bold initiative. Now, with the November elections behind them, state legislators from both parties are looking on the reform of the $500 million Fund in more a favorable light. Read more. posted by Ed Morrison |
Establishing a National Heritage Corridor in Tennessee Officials in 21 Tennessee counties are preparing to apply to the National Park Service to establish the Cumberland Plateau National Heritage Corridor. The designation can translate into cash. The federal government already invests in twenty-three other National Heritage Areas. Learn more. posted by Ed Morrison |
The opposition to Wal-Mart Wal-Mart provokes increasing opposition across the landscape. Here's a good overview article from Atlanta. Read more. (Free registration required.) posted by Ed Morrison |
Sunday, December 26, 2004 Here are the best articles on the economy from last week.
The Economy: Five Wild Cards For 2005
Long-Term Rates Pivotal for World Economy
Vital Signs for the Week of Dec. 27
Economy's rising among the upper crust
Global economy to slow in 2005, but developing countries to see robust growth
Economy: Slower but still steady ahead
U.S. Economic Expansion Projected to Continue in 2005
Forecasters agree: Growth likely to slow in '05 posted by Ed Morrison |
EDPro's best books of 2004 Here's a list of the best books I came across in 2004:
The Wisdom of Crowds by James Surowiecki: Like The Tipping Point, this book will open your eyes to the emerging power of networks.
The Price of Government by David Osborne and Peter Hutchinson: The authors raise and answer some important questions about how we can think about innovation in government. Taxes too high? Chances are we are working with outdated government structures and attitudes. They start with a compelling proposition: We should focus on buying results for citizens.
Finding Fertile Ground by Scott Shane: Written by the academic director of our center, this book provides an insightful approach to understanding entrepreneurship. EDPros have long put entrepreneurship as relatively low priority in their strategies. This bias extends to the economics profession, where few text books handle the topic well. Read more. In the years ahead, though, effective EDPros will become far more adept at building entrepreneurship and innovation networks.
The Future of Competition by C.K. Prahalad and Venkat Ramaswamy: The emergence of networks changes the way corporations create value. A useful follow-on to The Experience Economy by Joseph Pine and James Gilmore. (Gilmore is a Cleveland resident and is working with our center.) Pine and Gilmore argue that we are moving toward a profound shift in the way corporations create value.
The Power of Impossible Thinking by Jerry Wind and Colin Crook: A report on research conducted at the Wharton School about how leaders can change mental models. Many of the challenges we face in economic development come down to changing how people think: their cognitive frameworks. At REI we have been working of developing tools that EDPros can use to help reframe people's thinking about the future of their community. Too often, people drive into the future by looking in the rearview mirror. This book fits nicely with the next one.
Changing Minds by Howard Gardner: A leading psychologist summarizes how the revolution in cognitive science -- which has gained momentum since the 1990s -- provides insights into how people change their minds. Although the labels are a bit clunky at times, Gardner gives some useful examples of how leaders, like Margaret Thatcher, worked to change people's minds. You can listen to an interview with Gardner from National Public Radio here.
Appreciative Leadership by Jack Ricchiuto: Written by a consultant to our center, this short volume provides powerful insights into the type of leadership skills that EDPros need in a networked economy. (You can download the book for free.) Appreciative Leadership offers a different perspective on Appreciative Inquiry, an approach to organizational change developed at Case by my colleague, David Cooperrider. David has used Appreciative Inquiry in widely different contexts, and we are working to adapt this approach to regional economic development. Learn more about Appreciative Inquiry by exploring this Case web site.
The Power of Productivity by Willam Lewis: A former head of McKinsey's Global Institute explores why relative productivity matters in a global world. A bit dense, but if you are interested in the evolving global economy, this book provides valuable insights. (You can get a summary of the book here.)
The Creative City by Charles Landry: This book, originally written in 2000, has been revised. It provides useful tools and examples to make cities more creative places. The important insight is that arts and culture are not "add-ons" to economic development, but they can become key economic drivers. Unlike Richard Florida's work, Landry (whose book came out 2 years before The Creative Class) focuses on the practical aspects of design and implementation. Landry's work has been widely embraced in the UK, but he has not yet found an audience in the U.S. (Toronto, however, has been embracing Landry's work.)
Deliberation Day by Bruce Ackerman and James Fishkin: The authors propose a common sense, but radical idea for transforming our electoral process. The approach relies on the technique of deliberative discussion, an effective way to engage a diverse public. This approach provides valuable lessons for EDPros confronting strategic planning. Deliberative discussions provide the basis for large scale interventions with a group of people who do not know each other. We experimented with this format in October at Case. As one of sixteen campuses across the country, we conducted Deliberation Day for MacNeil Lehrer Productioons. Learn more. Economic development happens in the "civic space", and EDPros need some practical tools for improving the quality of civic interations. Deliberative discussions provide one approach.
Unique Value: Competition Based on Innovation Creating Unique Value edited by Chuck Weller. This book, edited by another professional working with our center, includes several chapters by Michael Porter who amplifies his theories of competition. This work underscores the importance of innovation and productivity to competitiveness. The book also illustrates how inductive theories of dynamic systems are displacing the deductive theories of classical economics. You see this displacement in the emergence of "cluster theory" as a strategic framework for regional economic development.
Planet Broadband by Rouzbeh Yassini: This little book provides a good explanation of why broadband matters. posted by Ed Morrison |
The creative economy is not just for cities
Friday, December 24, 2004 Richard Florida's idea of the creative economy is urban-centric: it happens in cities. But rural areas are equally able to compete in the global creative economy.
A case in point: Vermont. In October, the Vermont Council on Culture and Innovation released a report: Advancing Vermont's Creative Economy. You can download the report here.
The executive director of the Vermont Council on Rural Development has got it right when he says: " “The creative economy is a model, It’s not an add-on, or an accident, or a nice thing to do — it’s a foundation.”
Another participant in a recent panel discussion amplified the point: The creative economy “is a model that recognizes and values creativity — in individuals, communities, and businesses.” Read more. posted by Ed Morrison |
Pennsylvania's new manufacturing initiative Pennsylvania governor Rendell has announced an ambitious plan to assist manufacturing companies in his state. The governor is boosting support in key areas, such as financing and job training. He has also named the state's first manufacturing ombudsman. Read more.
The initiative follows an extensive report for the Team Pennsylvania Foundation on the future of manufacturing in Pennsylvania. You can download the report here. posted by Ed Morrison |
Is Texas forgetting the basics? Governor Perry is making a bold move to renew the state's enterprise fund and to develop a second fund for research in new technologies. Total planned commitment: $600 million. Read more. The proposal has already generated interest from the national business press. Here's an article from Inc magazine.
During the debate on this proposal, I hope some legislators will be asking whether the state should also renew its commitment to the TEXAS Grant program. This initiative --- created in 1999 -- helps low income students pay for college. The fund recently ran out of money, and 23,000 Texas college students will be affected. Learn more.
Just as the TEXAS Grant ran out of money, the federal government has changed rules on the Pell grant program (also for low income students). The federal program changes will make it harder for these students to pay for college. Learn more.
On the basis of the National Report Card on Higher Education, Texas scores a "D" in affordability. Learn more.
In our rush to come up with politically attractive initiatives, we need to remember the basics. Economic development in the knowledge economy starts with brainpower. If we do not educate our young people -- and make it easy for them to afford college -- no amount of money invested in recruitment or university tech transfer will matter much in the long run. The businesses we create here will simply migrate abroad...where the brains are.
We are already seeing some disturbing trends. US colleges and universities are facing stiff competition in attracting the best students, as higher education undergoes rapid globalization. Read more. posted by Ed Morrison |
Colleges and universities as economic engines As we move toward an economy driven by knowledge and innovation, universities are playing a different and more central role in regional economic development. The colleges and universities do not have to be big to have an impact.
We've all heard stories of Stanford and MIT. Smaller institutions are also having significant impacts: Like Albion College in Albion, Michigan, Ashland University in Ashland, OH or Old Dominion University (ODU) in Norfolk.
We are seeing the new view of colleges and universities in an increasing number of economic impact reports that institutions are producing. For example, Utah's research universities published a report within the past two weeks. Read more.
Here's a good article on the changes taking place at ODU. It also provides a good overview of the changing rroles of colleges and universities in economic development. Read more.
The article references an excellent report by CEOs for Cities: Leveraging Colleges and Universities for Urban Economic Growth: An Urban Action Agenda. You can download a copy from this page. posted by Ed Morrison |
Web Watch: New Iowa web site to help entrepreneurs Iowa is following an integrated series of steps to improve the entrepreneurial climate in the state. Led by the Iowa Coalition for Innovation and Growth, the initiative focuses on providing better networks among Iowa entrepreneurs, investors, and service providers.
The latest project is a new web site to help entrepreneurs. Read more. Or, visit the web site posted by Ed Morrison |
The growing kitchen incubator trend We're starting to see more kitchen and food incubators popping up. Here's another case from New Orleans. Read more. Here's a good background article on kitchen incubators.
This trend leverages a broader movement toward regional foods. Read more.
If you want to learn more about kitchen incubators, here's an example from Denver and here's another from Idaho. Finally, here's one developed by our friend and colleague, June Holley at the Appalachian Center for Economic Networks, or ACEnet. Learn more. posted by Ed Morrison |
The competitive advantage of local customer service Here's another story that demonstrates that the issue of outsourcing is more subtle and complex than simply a comparison of wage rates.
Comcast is building up its call center jobs in New England. Despite the wage penalty, the company finds that a New England based call center operation generates higher levels of customer satisfaction and a lower level of customer complaints. In other words: quality and customer relationships are the end game, not simply cost reductions. Read more. posted by Ed Morrison |
Bangor: Focusing on brainpower and creativity Bangor, ME is another community that is learning a new approach to economic development. The focus is on building, attracting and retaining brainpower: people. As the mayor points out:
“Obviously in the last few years, especially in this part of the country, the economy is changing. We’re losing shoe manufacturers, papers mills...we’ve positioned ourselves to attract those businesses that are on a growth course. With the computer age, the Internet, people can locate and work wherever they want.”
Read more. posted by Ed Morrison |
Outsourcing: Congress heads in the wrong direction
Thursday, December 23, 2004 Judy Olian, dean of the Smeal College of Business at Penn State University, has written a good overview of the debate on outsourcing that is now taking place in the economics profession. She reviews the debate on both sides of the issue.
She concludes, "We're still in the midst of the dislocations and transitions resulting from global outsourcing, so it's premature to judge long-term results. What seems evident so far? Yes, corporate earnings and investors are benefiting. Yes, U.S. consumers are benefiting from cheaper prices due to global outsourcing. Yes, U.S. workers are dislocated -- perhaps permanently in the manufacturing sector and significantly among professional and white-collar employees whose jobs won't return unless the country invests substantially in their retraining and education."
Yet, we see that Congress is now making it harder for low income students to pay college tuitions. You can listen to a recent report from National Public Radio from this page. Or, you can read more about the policy change here. posted by Ed Morrison |
Why a stadium does not generate prosperity The PBS News Hour program had an interesting segment exploring whether stadium deals represented economic development. Andrew Zimbalist, professor of economics at Smith College and author of May the Best Team Win: Baseball Economics and Public Policy made the clearest case for why baseball and football stadiums are not by themselves good economic development investments.
"Practically every stadium that's come on stream in the last 20 years in the United States has been accompanied by a consulting report-- these are hired-out consulting companies-- that are working for the promoters of the stadium.
"They engage in a very, very dubious methodology. They make unrealistic assumptions and they can produce whatever result they want to produce." Read more.
This issue is about to be played out in another city: Indianapolis. Read more. posted by Ed Morrison |
KY foundation must disclose incentive deal
Wednesday, December 22, 2004 A Kentucky appellate court has decided that a private foundation that spends public money must release its records to the public. This decision strips away the argument that a private foundation can keep its records private. In making the decision, the Kentucky court found that the private foundation expends public money. Read more.
This decision represents an important victory for advocates of public accountability. Some years ago in Louisiana, a group attempted to obtain disclosure of records from the Biomedical Research Foundation of Northwest Louisiana. Each year, the Foundation receives public money as the proceeds from a local sales tax. The foundation holds that once it receives these funds, it has no obligation as a private foundation to disclose how it spends this public money beyond its public filings with the IRS.
We can only hope that the Kentucky court decision opens the door to more effective disclosure in other states, like Louisiana. posted by Ed Morrison |
Helping immigrant entrepreneurs Here's an interesting program to encourage immigrant entrepreneurs to start their own businesses. Read more. posted by Ed Morrison |
Building the arts in Zanesville Zanesville, OH is a city of about 25,000 people sixty miles east of Columbus. A new artists group is forming that opens some interesting economic development opportunities for the city. Read more. posted by Ed Morrison |
Incentive worries? Nope
Tuesday, December 21, 2004 Some EDPros are worried about the impact of the Ohio tax ruling on incentives. Read more.
EDPros have a lot of challenges ahead, but worrying about the impacts of the Ohio tax ruling is not one of them. (And the notion -- as one person suggests in an article -- that we need tax incentives to offset lower labor rates abroad is not based on sensible thinking. The labor costs gaps with emerging markets are simply too large to do that. Read more.)
We need to be more concerned about the fact that the U.S. lags behind in broadband penetration. Read more. (Do you have a broadband deployment plan in your community?)
Or, we should focus on the fact that our students lag behind other countries in math and science skills. Read more. (Is your business community fully engaged in improving education? See, for example, Educators for Educational Excellence.)
Or, we should focus on the fact that creativity and innovation is developing quickly offshore. Read more here and here. (How is the health of the innovation and entrepreneurship networks in your community? Do you teach entrepreneurship skills in your high schools? Do you sponsor business plan competitions? Do you encourage angel investors?) posted by Ed Morrison |
Northeast Ohio business plan competition Business plan competitions are an effective way to boost interest in entrepreneurship in your economy. Here's an article from McKinsey that outlines how business plan competitions accelerate economic development. Read more.
Earlier this week, Cleveland announced a regional business plan competition. You can read more about it here or visit the web site.
Here's an article on how business plan competitions are starting to change the business climate in Wisconsin. Read more. posted by Ed Morrison |
Florida, Georgia shift focus to retention
Monday, December 20, 2004 In Florida, leading economic development groups are forming Florida Business Insights, a pilot initiative to support existing businesses. Read more.
Georgia's governor is preparing two new initiatives to support Georgia business development: the "Entrepreneur and Small Business" initiative and "Strategic Industries and Innovation" initiative. The proposals have yet to be drafted, but they are already getting positive reviews. Read more. posted by Ed Morrison |
Bioscience district emerging in Atlanta Developers are pushing for a new bioscience district in Atlanta; it is one of several that are emerging in Georgia. Read more.
(Another corridor is emerging along State Route 316 between Gwinnett County and the University of Georgia in Athens. Read more.)
Last week, Gov. Sonny Perdue challenged the Georgia Research Alliance to explore whether the state needs a geographic location like Research Triangle Park in North Carolina to develop a higher profile for its technology-based development. (The legislature created the Alliance in 1990 as an economic development strategy to promote innovative research at Georgia's universities. The alliance supports collaborations between public and private sectors to develop federal grant funding and science-related businesses in Georgia.) posted by Ed Morrison |
The Great California Stem Cell Rush According to this article from The Boston Globe, California is set to benefit from a rush to develop technologies based on stem cells. (Wisconsin is another early mover. Read more.)
According a prominent researcher in the field here in Cleveland, the California rush may turn out to be less than it seems. Funds dedicated to stem cell research may end up being diverted to other programs, if the funds cannot be productively deployed in stem cell research. posted by Ed Morrison |
Translating ideas into action in NW North Carolina As a former consultant, I'm happy to see communities that actually move from talk to action. That's what's happening in Northwest North Carolina. Read more.
Several factors need to align before ideas can be translated to action plans. First, the process of developing the plan needs to be designed in such a way that you build consensus around a handful of initiatives. Next, you need a leadership team capable of maintaining focus...and knowing which way to jump when circumstances change. In sum, good economic development requires both public participation and leadership direction. posted by Ed Morrison |
Hampton Roads picks some clusters Hampton Roads, VA has outlined five targets for future development: ports and distribution, information and technology, modeling and simulation, technical services and tourism. Learn more. posted by Ed Morrison |
Landmark innovation report presents our challenge The full "InnovateAmerica" report by the U.S. Council on Competitiveness is now available online in PDF format. You can download it here. Learn more.
The opening resolution of this landmark report says it all:
"Innovation will be the single most important factor in determining America's success through the 21st century... America's challenge is to unleash its innovation capacity to drive productivity, standard of living and leadership in global markets.
At a time when macro-economic forces and financial constraints make innovation-driven growth a more urgent imperative than ever before, American businesses, government, workers and universities face an unprecedented acceleration of global change, relentless pressure for short-term results, and fierce competition from countries that seek an innovation-driven future for themselves. For the past 25 years, we have optimized our organizations for efficiency and quality. Over the next quarter century, we must optimize our society for innovation." posted by Ed Morrison |
Saturday, December 18, 2004 Here are the best economics articles from last week:
White House Predicts Slightly Lower U.S. Growth
Economic Development Essential to Address Climate Change
Meeting will launch public campaign on Bush's economic reforms
Vital Signs for the Week of Dec. 20
U.S. trade gap widens, industrial output up
All Eyes on the Inflation Watch
The cost of borrowing posted by Ed Morrison |
Western North Carolina's new infrastructure Western North Carolina is one of my favorite regions to watch. They are effectively building the networks a region needs to compete in a global economy. More impressive, they are building this infrastructure in a rural region. Here a case in pont.
A sophisticated information technology company recently announced that it would expand in Western North Carolina. The company needs the high speed fiber-optic network. It also benefits from a proximity to Oak Ridge National Labs. Finally, the region's new angel capital network has stepped in with a $2 million investment. Learn more. posted by Ed Morrison |
Topeka Chamber launches incubators The Topeka Chamber of Commerce has launched two new incubators targeted at minority and disadvantaged businesses. Learn more. posted by Ed Morrison |
Investing in colleges and universities The president of Washington State University is busy making the case that research universities are the new engines of economic development. Read more.
We are starting to see college and university presidents becoming far more assertive in pressing the need for investments in higher education. Last week, Utah and Utah State released a report on their economic impact. Read more. Here's another view from western North Carolina.
And this week in Michigan, Commission on Higher Education and Economic Development released its report and recommendations. Read more. You can download the Michigan commission report from this page. posted by Ed Morrison |
More evidence on the emergence of regions Globalization is pushing regions to the forefront of economic changes, while at the same time weakening the leverage of national governments to intervene in markets.
Here is a good case in point. This week, the United Nations is holding a global warming conference in Argentina. While the Bush administration has dug in its heels by refusing to sign the Kyoto Protocol to reduce "greenhouse gases", a number of states are moving ahead on their own.
In New England, eight states have come together in an effort to reduce emissions. last month, in the Pacific Northwest, California, Oregon and Washington signed an agreement to work together. Even more interesting, talk emerged this week of a European-U.S. market in carbon-trading.
posted by Ed Morrison |
The new role of colleges and universities Northern Kentucky University is one of my favorite institutions to watch. They understand the changing role that colleges and universities must play in economic development.
Here's the latest initiative out of NKU. They want to launch an ambitious Partnership for Regional Economic Progress, consisting of eight related initiatives. It's the kind of aggressive strategy that makes sense in this global economy. Read more. posted by Ed Morrison |
Dell squeezes NC until it hurts Make no mistake: Dell has extracted just about every drop of incentives available in North Carolina. After the state assembled a package worth over one quarter of a billion dollars, Dell touched off a local competition to squeeze even more incentives out of the deal. Read more.
EDPros need to start redirecting our energies from subsidizing businesses to investing in brainpower. James Surowiecki (who has written an excellent book, The Wisdom of Crowds) points out the folly of our ways. Read more.
We'll be continuing to watch states and local governments go overboard on the incentive game. The next show to watch: Toyota. posted by Ed Morrison |
Activating a clawback San Antonio activated the "clawback" provision of its incentive agreement with Alcoa this week. Read more. Clawback provisions make sense, so that EDPros can avoid controversies like the one that recently surrounded the closing of the Maytag plant in Galesburg, IL.
When Maytag Corp. started talking about closing shop and moving 2,000 jobs out Galesburg a few years ago, the community and the state put together a package of millions of dollars in grants and loans to induce Maytag to stay. The company took the money but then decided to close its factory and transfer manufacturing to Mexico anyway. The local prosecutor has sued Maytag to recover $1.1 million in property taxes. Read more.
Here's some more background on the situation in San Antonio. Read more. posted by Ed Morrison |
Good quote on broadband Here's a good quote from an official from the Blandin Foundation in Minnesota. This week, Blandin announced the availability of funds to assist rural communities gain access to broadband networks.
“In today’s global economy, we are no longer competing with our neighbors in South Dakota, Iowa or Wisconsin. We are competing with every country, every business, everyday. Communities that want to thrive must embrace broadband. It’s as simple as that.”
posted by Ed Morrison |
Texas governor proposes $600 million in new funds The governor of Texas wants $300 million more for the Texas Enterprise Fund (used to attract firms) and another $300 million for the Emerging Technology Fund, targeted at creating new companies spinning out of the state's universities. Learn more.
The purpose of the Texas Enterprise Fund is to give the state the flexibility and "deal closing" capability in economic development. Read more background.
The governor's proposed Emerging Technology Fund will mostly benefit the state's colleges and universities. Learn more posted by Ed Morrison |
Connecting to foreign markets through universities Here's a good example of a university-based research partnership that can open the door to global business opportunities. The University of New Mexico and a research center in Mexico have formed a partnership in electrochemistry. Read more.
As regions globalize, colleges and universities play an important role in opening the door to foreign markets. University-based collaborations are relatively easy to form, and they carry relatively little downside risk. They open the door to new networks in a foreign country, and they can reduce the time for U.S. businesses to get connected.
In many foreign markets, the connection between universities and the business community is closer than in the U.S. So, for example, a U.S. business seeking to enter the China market can use academic exchanges -- conferences and meetings -- to develop networks in China. posted by Ed Morrison |
Wind power in rural regions In some rural economies, wind energy is becoming a significant economic development opportunity. Here's a report on the economic development consequences of a wind farm in rural Oregon. Read more. You can download the report from this page. posted by Ed Morrison |
Trying to come together in rural Michigan Oceana County, MI sits on the western edge of Michigan and has 26,000 people; Mason County to the north has 28,000; Manistee County, the next county up has 24,000 people.
The local community college trying to get all three to come together in a new regional economic development effort. Read more.
In these situations, the alternative is to build networks, not consolidate, necessarily. Networks enable each county to maintain their identities. posted by Ed Morrison |
Fragmented in Tucson The economy is booming in Tucson, but economic development efforts are still fragmented. In 2005, there may be a good chance that civic leaders will meet the challenge of focusing their efforts. Read more. posted by Ed Morrison |
Bared teeth in Bay County
Friday, December 17, 2004 Jay Garner passed this article along. The editorial demonstrates the costs communities pay when politics gets personal and consensus is nowhere to be found. Read more
There's no law in economics that says Bay County, Michigan needs to exist. Further, it is possbile for "leaders" in a community to drive the economy into the ground. Bay County illustrates the importance of educating public officials to the new world of economic development. If left unaddressed, matters can always get worse. posted by Ed Morrison |
Assessing South Carolina's progress Darla Moore, a former investment banker, is the lead architect of South Carolina's push into cluster-based development. The move is significant as a paradigm shift in the way economic development is done in the state.
South Carolina has been one of a number of Southern states that have built an impressive economic base with recruitment strategies. These recruitment strategies emphasized the state's relatively low cost structure. Now, the state is moving toward innovation and productivity improvement as a generator of wealth.
In a recent speech, she evaluated the state's progress. Read more. posted by Ed Morrison |
Mississippi's pilot preschool programs Here's more evidence of the growing link between economic development and preschool education.
Increasingly, civic leaders are making the connection between improved preschool education and better educational outcomes. Investments in preschool pay dividends in improved school performance. These results are measurable.
Four communities in Mississippi are launching a pilot preschool program. One of the rationales for the initiatives is to promote economic development. Read more. posted by Ed Morrison |
Here's a quote you can use Auburn University professor Joe Sumners recently spoke to civic leaders on the changes in Alabama's economy. He came up with a good quote that summarizes the shift underway. The competitive challenge ahead of us is not "what does labor cost, but what does labor know?" Read more. posted by Ed Morrison |
Business creativity center Here's a new type of infrastructure in economic development. EDPros from the San Diego North Economic Development Council have announced a business creativity center. Learn more. posted by Ed Morrison |
Networking in Fayetteville
Monday, December 13, 2004 Here's a common sense idea: a networking event for young professionals. Folks in Fayetteville, AR just pulled off an event that attracted 250 people. Read more. posted by Ed Morrison |
Sunday, December 12, 2004 Here are the best articles from last week.
Rubin: American Economy at Dangerous Crossroads
Economic news can spin many ways
Vital Signs for the Week of Dec. 13
Economic dangers loom with start of second term
Inflation signals appear in economy
E-Tailing Finally Hits Its Stride
U.S. Productivity Growth Slows
U.S. Economic Outlook Dims posted by Ed Morrison |
Plant more seeds Here's some more sound advice.
Patrick Barkey, director of economic and policy studies at Ball State University, writes a regular column for the local paper. In his latest column, he explores the question, "What can Indiana do to stem the loss of corporate headquarters?"
His answer: Forget the incentive/recruitment game -- plant more seeds for new companies. Read more. posted by Ed Morrison |
Ohio's new information highway
Saturday, December 11, 2004 Earlier this month, Ohio launched a major new information infrastructure, the Third Frontier Network. Among other benefits, the high speed data network holds the promise of accerating commercial development of research and impriving the way health care is delivered.
The high speed network will also connect primary and secondary schools. So, for example, a high school and a college can now partner in the development of improved science enducation. Read more.
You can learn more about the network from this web site. posted by Ed Morrison |
Branding Kansas Kansas will be launching a new branding campaign in January. Read more. You can get a preview from this site. posted by Ed Morrison |
Improving the flexibility of higher education One sure way to improve a regional economy comes through investments in higher education. Unfortunately, many state legislatures, facing budget cuts, have reduced the relative priority of higher education. But that is only part of the problem.
A more serious structural problem in most states comes in the systems of administrative control over different types of higher educational institutions. This administrative burden translates into less flexibility on the ground. Students have a harder time transferring credits among educational institutions.
For the past number of years, innovations are seeping into some states to improve the responsiveness of higher education to its prime customers: the students. Here's an example. posted by Ed Morrison |
Creative strategies This week Vermont issued a report on their creative industries strategy. You can read more about it here. You can also download the report.
Also, in Michigan this week, the governor's Cool Cities initiative listened to Malcolm Gladwell, author of The Tipping Point. Over 1,000 people attended the conference. Read more about the conference.
posted by Ed Morrison |
The beginning of Florida Jacksonville's new branding campaign is based on the tag line, "Where Florida begins". The campaign, according to the mayor, is designed to differentiate along two dimensions: "First, how does Jacksonville compare with other Florida cities? And secondly, what characteristics differentiate us from other U.S. cities?" Read more. posted by Ed Morrison |
A concise guide to strategy in a global era Each week, Chuck Lawton writes a column on economic development for the newspaper in Portland, ME.
Here's his contribution from last week. It provides us a clear framework to think about the challenges of globalization. Read more. posted by Ed Morrison |
Questioning incentives The competition for recruitment deals has never been more intense. But there's also a new skepticism about whether incentives make sense.
It used to be that only economists and public policy professionals raised much question about incentives. Now we see the debate shifting more to the popular press. Some are questioning whether incentives are justified. Others argue that there are better long term returns if we increase investments in early child care.
Here's another article from Memphis that raises questions about the value of incentives. Read more.
A prediction: in the years ahead, economic development incentives will start to shift from companies to people. Here's a good article from San Antonio. posted by Ed Morrison |
Higher education and economic development One of the clear lessons we face is this: A high school education is no longer enough for a middle class job.
In Montana, a leadership group is grappling with how to increase the number of young people moving on to college. They have broken down the challenge into some workable components. Learn more. posted by Ed Morrison |
The square root of nine is trouble We face a looming challenge to improve our deteriorating math skills. That;s the message of a new report that compares the U.S. to other developed countries. Our young people rank near the bottom. Learn more.
We are already seeing the consequences of weak basic skills throughout the economy. Here is a good example from Louisiana. A recent study finds that weak basic skills translate into unfilled jobs and less competitive companies. Learn more.
If you want to get up to speed on this issue, I recommend that you read Teaching the New Basic Skills. You can buy it used on Amazon for less than a buck. But don't let the price fool you. It's written by economists from Harvard and MIT, and it provides the best outline of the challenges we face as EDPros. posted by Ed Morrison |
Second tier markets in biotech
Wednesday, December 08, 2004 Maine recently completed a site analysis for biomed facilities, and the report holds some promise for second tier cities. According to the report's author, John Boyd of the Boyd Company, Inc.:
"There's a shift from large, (cost) prohibitive markets like Boston, Princeton and Atlanta to smaller markets with low cost-of-living indexes, low tax structures, low cost of doing business. Really, it's no secret. There's an exodus away from the large cities, especially with respect to California."
Read more. Here's some additional background. posted by Ed Morrison |
Silicon Valley continues to build its networks Silicon Valley is a region thick with networks and support for entrepreneurs. But this fact does not deter EDPros from continuing to build out their infrastructure of support networks for innovation and entrepreneurship.
The latest project: a partnership between an established organization with a strong track record -- The Enterprise Network of Silicon Valley -- and a new organization -- the Institute for International Business Development. The partnership will provide new international business opportunities for Hispanic businesses. Learn more. posted by Ed Morrison |
Promoting rural arts and entrepreneurship Here's an interesting idea out of Montana. The TRACE program, which stands for Transforming Rural Artisans into Creative Entrepreneurs, provides training to rural artists in the basics of business development. Learn more. posted by Ed Morrison |
An anchor investment at a university Clusters typically form around anchor investments. These anchor investments most commonly take the form of large company facilities (the Toyota plant in San Antonio, for example) or university-based research centers.
Here's an example of an anchor investment in a university: The Virginia Modeling, Analysis and Simulation Center at Old Dominion University. The center has spawned over 4,000 high paying jobs in the region. Learn more. posted by Ed Morrison |
Economic development: its about balanced systems Economic development used to be about "things": developing an industrial park, recruiting a business, building a spec building.
Increasingly, we are coming to understand that this "thing theory" of economic development is inadequate. Sustainable economic development requires balanced investment in a range of areas. EDPRos need a deeper, systems view of their economies.
Here's a report that illustrates importance of understanding interdependencies. A report that will be released this week in albany notes that if EDPros are successful in recruiting high tech companies, there are not enough skilled people around to fill the jobs. Read more. posted by Ed Morrison |
Toledo moves to consolidate After months of discussion and a major consulting report, Toledo and Lucas County has apparently agreed to merge their economic development efforts.
This move reflects a deeper trend. Regions can no longer afford the multiplicity of efforts that leads to confusion and stalemate. Read more. posted by Ed Morrison |
Resource: Development Report Card for the States The Corporation for Enterprise Development has released its 2004 Development Report Card for the States. You can download it from this page. The data are freely available for download in an Excel format, as well. posted by Ed Morrison |
Winston Salem's Christmas present to Dell Winston-Salem is putting together a big package for Dell: $37 million. (That's three times the $12 million package proposed by Greensboro.) Read more.
Meanwhile, transportation and people were two of the prime business reasons for choosing the Triad, according to Dell. Read more. posted by Ed Morrison |
A strategy for the Mon Valley
Tuesday, December 07, 2004 Competition has hit the Monongahela Valley of Pennsylvania hard. There are no simple answers, no easy path to prosperity.
In the late 1970's and early 1980's, US Steel, Westinghouse Electric, Wheeling-Pittsburgh Steel and others closed major manufacturing plants in the Mon Valley. These facilities provided a major portion of the employment base of not just the Mon Valley, but of Western PA.
Late last week, civic leaders in the Valley gathered to hear the key points of a new strategy. Learn more.
You can visit the project web site and download the strategy documents from this page. posted by Ed Morrison |