“Regional Champions” are important to Economic Growth

That’s the findings of several recent scholarly papers highlighted by the State Science and Technology Institute.  Here is one of the more interesting points raised by the research:

 [According] to the authors’ analysis it is not high-technology concentration that fuels job creation, but growth Sproutin high-technology concentration that matters most. This challenges the common view that high-technology concentration is associated with faster job creation, whereas in actuality it is a MSAs capacity to grow its high-tech base that creates jobs.

If entrepreneurship and a capacity to grow its high-tech base influence a region’s job creation, then what impacts a region’s ability to grow in these factors? According to Maryanne Feldman, the character of place – the “spirit of authenticity, engagement, and common purpose” — is the particular feature that differentiates successful places.

Feldman notes that character of place can be defined by entrepreneurial attachments and investments, government capacity building, and local communities with common interests. Citing historic examples like Fred Terman (Silicon Valley), Ewing Marion Kauffman (Kansas City), and George Kozmetsky (Austin), as well as contemporary examples such as Dan Gilbert (Detroit) and Tony Hsieh (Las Vegas), attachment to place of what Feldman calls “regional champions” is critical to the ability of these individuals to establish the institutions and connections that are necessary for the transformation of local economies. Ultimately, geographic places have history and context that is meaningful to people like regional champions, as well as to subsequent waves of entrepreneurs. In addition to places facilitating the face-to-face interactions intrinsic in the development of social capital, geography also enhances the probability of serendipity and the chance for something unexpected to have transformative impacts.

So here’s the queston:  do “authenticity, engagement and common purpose” trump tax incentives?  And if they do (or if they merely matter as much as tax policy) doesn’t it make sense to invest in quality of place as much as in those incentives?

The full story is here.

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