Job hopping and innovation Thursday, December 01, 2005 We may be making some headway with the economists. In my experience, economists generally have a very difficult time understanding Michael Porter's cluster theory. The reason: Clusters are open innovation systems in which social networks disperse knowledge and innovation. Regions with thick open networks are more competitive. Why? Because knowledge and innovation -- translating ideas into valuable products -- are a product of networks. This theory was set forth well in AnnaLee Saxanian's book, Regional Advantage in 1994. Saxenian argued that Silicon Valley responded to the technology shift to personal computers away from minicomputers much faster than Rte 128 in Boston. The reason: Silicon Valley had thicker open business networks. These networks allowed business organizations to move resources far more quickly than in Boston, where companies like DEC and Prime ultimately failed. The basic message: regions with thicker open networks of collaboration are more competitive. They will spot opportunities faster, align their resources faster, and act faster. This message fit well into Porter's emerging cluster theory. (Porter's cluster theory first appeared in his 1990 book, The Competitive Advantage of Nations.) The economists have difficulty understanding the importance of open networks. The main reason comes down to methodology. There is no easy way to run regressions on social networks. (Not surprisingly, Saxenian is not an economist.) Now, it seems, the economists may have a data set that can help them see the light. Read more. If you look at job hopping from a classical economic view, job hopping should discourage investments in innovation. But if you look at innovation from the perspective of an open system, job hopping is just the type of behavior that speeds learning and forms new networks. posted by Ed Morrison |		This work is licensed under a Creative Commons License. links Some Background on EDPro Weblog The purpose of this weblog is to help economic development professionals -- EDPros -- keep up with the changes sweeping our profession. Strap on your goggles. It's a whole new game. There are no experts any more. The only place to learn about economic development is from other EDPros who are doing it. One other point: the prevaling approach (paradigm, if you like) in economic development is shifting from competition to collaboration. There are a lot of reaasons underlying this shift, but here's the important insight: You, your community, and your region will do better by collaborating and sharing information. So, spread the word...Share the knowledge. Tell a friend about EDPro Weblog. If you are using a news reader, here is the link to syndicate this site: Here's the link if you are a bloglines subscriber: Speaking and workshops on Open Source Economic Development As the idea of Open Source Economic Development starts spreading, more people are asking about it. Visit the I-Open web site to learn more. My colleagues and I are happy to explain the basic concepts in a talk or a workshop. E-mail Susan Alshuler if you'd like to learn more about workshops and speaking. Background on Ed Morrison Download some background information on me here.

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