significant resources, often with a sector focus and often in partnership with foundations, universities and the private sector. Increasingly, they seek to leverage complementary federal programs to support the development of regional centers of innovation, entrepreneurship, and high-technology development.

These developments mark a significant change in paradigm. For much of the Twentieth Century states pursued economic development by seeking to recruit companies from other states by offering a more competitive business and regulatory environment, lower taxes, supportive government policies, and financial and infrastructure incentives. States still do this and sometimes see other states as competitors, but increasingly they see them as partners as well. Indeed, many states are shifting their policy focus to address the competition that has emerged from other regions of the world for leadership in the industries of the future.

To better understand these policies and their impacts, a committee of the National Academies Board on Science, Technology, and Economic Policy (STEP) reviewed regional and state innovation programs across a limited number of highly diverse states. These conferences, held in Arkansas, Hawaii, Michigan, Ohio, Illinois and New York, have generated an improved understanding of the challenges associated with the transition of research into products, the practices associated with some successful state and regional programs, and their interaction with federal programs and private initiatives.

The common element in each of the regional meetings is the growing determination of the state and regional authorities and the private sector to enhance technological capacity, university-industry connections, and economic growth in the region for current and future generations.

OBSERVATIONS FROM THE CASES

The experience of states and regions examined in this study show that:

•   Leadership by the public and private sectors, including elected officials, university presidents and industry representatives, is crucial to bring together public and private stakeholders in a region.

•   Investment of substantial public funds by the states over a substantial period, along with the development of intermediating institutions provides the foundation for progress. These investments also often have a catalytic effect, attracting private investments, as well as support from foundations and the federal government.

•   Sustained support by states for educational institutions can be important for long-term economic development. They provide the research facilities, a trained workforce, a flow of ideas for commercial development, and the branding that characterize successful regions.



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