Title: REGIONAL INNOVATION SYSTEMS AS THE KEY TO GLOBAL COMPETITIVENESS: IMPLICATIONS FOR RURAL AREAS AND W
1REGIONAL INNOVATION SYSTEMS AS THE KEY TO
GLOBAL COMPETITIVENESS IMPLICATIONS FOR RURAL
AREAS AND WORKERS
- by
- David Barkley and Mark S. Henry, Professors
- and
- Santosh Nair, Research Associate
- Department of Applied Economics Statistics
- Clemson University
2The Global Economy The Knowledge Economy The
High-Tech Economy The New Economy
Changes in Technology Changes in Production
Practices Changes in Location of Economic
Activity Changes in the Demand for Labor
Regional Innovation Systems
- Research Triangle Park, (NC)
- International Center for Automotive Research
(SC) - Scripps Institute East Coast Facility (FL)
- Translational Genomics Research Institute (AZ)
- Oregon Nanotechnology Microtechnologies
Institute - Stowers Institute for Medical Research (MO/KN)
3Table 1. Summary Characteristics of the Old
and New Economies
4Table 2. Employment Change by Industry, Metro
Vs. Nonmetro, 1990-2000
5Table 3. Industries with the Largest Wage and
Salary Employment Growth and Declines, 2002-2012
Source Berman, 2004
6Table 3. Industries with the Largest Wage and
Salary Employment Growth and Declines, 2002-2012
(cont.)
Source Berman, 2004
7Table 4. Average Wages in Expanding and
Contracting Industries, 2002-2003
8Table 4. Average Wages in Expanding and
Contracting Industries, 2002-2003 (cont.)
9Table 4. Average Wages in Expanding and
Contracting Industries, 2002-2003 (cont.)
10Table 5. Employment Distribution and Change by
Occupation, South and U.S., 1999-2002
11Table 6. Occupations with Largest Job Decline,
United States, 2002-2012
Source Hecker, 2004
12Table 6. Occupations with Largest Job Decline,
United States, 2002-2012 (cont.)
Source Hecker, 2004
13Table 7. Occupations with Largest Job Growth,
United States, 2002-2012
Source Hecker, 2004
14Table 7. Occupations with Largest Job Growth,
United States, 2002-2012 (cont).
Source Hecker, 2004
15Table 8. Fastest Growing Occupations, United
States, 2002-2012
Source Hecker, 2004
16Table 8. Fastest Growing Occupations, United
States, 2002-2012 (cont.)
Source Hecker, 2004
17Table 9. Elements of Regional Systems of
Innovation (Acs, 2002).
A. Inter-firm relationships 1. Network
economies 2. Clusters 3. Supplier
chains as source of innovation 4. Cooperatio
n and trust B. The knowledge infrastructure 1.
University research 2. Focus new product
RD 3. External sources of
knowledge 4. Local RD spillovers C.
Community and the public 1. Emphasis on
regional level sector 2. Public-private
partnerships 3. Community, cooperation and
trust
18Table 9. Elements of Regional Systems of
Innovation (Acs, 2002). (cont.)
D. Internal organization of the firm
1. Organic organization 2. Continuous
innovation 3. Matrix organizations E.
Institutions of the financial sector 1. Venture
capital 2. Informal financial
sector F. Physical and communication
1. Global orientation infrastructure
2. Electronic data exchange G. Firm strategy,
structure and rivalry 1. Easy to start new
firms 2. Inexpensive access to
knowledge 3. Entrepreneurship is crucial
19- Table 10. Examples of Innovation Measures Used
in Previous Research on Innovative Activity or
Capacity
- A. Innovative Activity or Capacity
-
- Patents
- Academic R D Expenditures
- Industrial R D Expenditures
- Federal R D Expenditures
- Innovation Counts
- Small Business Innovation Research (SBIR)
Grants - Undergraduate/Graduate Degrees in Science and
Engineering - Professional Employment in High Tech Industries
20- Table 10. Examples of Innovation Measures Used
in Previous Research on Innovative Activity or
Capacity - (Cont.)
- B. Human Capital or Labor Quality
- High School Graduates as of Population
- College Graduates as of Population
- Technical School Graduates as of Population
- Working Age Population
- Managerial, Professional, and Technical
Employment - Online Population
- Computer Availability and Use in Schools
21- Table 10. Examples of Innovation Measures Used
in Previous Research on Innovative Activity or
Capacity - (Cont.)
- C. Entrepreneurial Environment
- Venture Capital Investments
- Initial Public Offerings
- New Publicly Traded Companies
- Employment in Gazelle Firms
- New Business Start-Ups
- Job Churning (product of business start-ups and
business - failures)
- Small Business Employment
- Employment/Establishments in Business Services
- Diversity of Population
22- D. Agglomeration Economies
- Employment/Establishments in High Technology
Industries - Inc. 500 Companies
- Population Density
- Density of Establishments
E. Competitiveness of Local Economy
- Export Activity
- Manufacturing Employment Growth Rate
- Importance of Regional Economy to U.S. Economy
Sources Huovari (2001), Hill (1998),
Catalytix (2003), Porter (2001), SGBP (2001,
2002), Atkinson and Gottlieb
(2001), Gardiner (2003), Markusen (2001), Acs
(2002), Florida (2002).
23 National State Technology Science Index
Overall Index, 2004
Rank
Rank State (2004)
State
(2004) Massachusetts 1 New
Mexico 14 California 2 New
York 15 Colorado 3 Pennsylvania 16 Maryland
4 Arizona 17 Virginia 5 Georgia
18 Washington 6 Oregon 19 New
Jersey 7 North Carolina 20 Minnesota 8
Illinois 21 Utah 9 Vermont 22 Connecticut
10 Texas 23 Rhode Island 11
Ohio 24 New Hampshire 12 Michigan 25 Delawar
e 13
24 National State Technology Science Index
Overall Index, 2004 (cont.)
Rank
Rank State (2004)
State
(2004) Kansas 26 Hawaii 39 Wisconsin 2
7 Alaska 40 Nebraska 28
Wyoming 41 Indiana 29 Louisiana 42 Idaho
30 Nevada 43 Missouri 31 South
Carolina 44 Florida 32 North
Dakota 45 Maine 33 West Virginia 46 Tennes
see 34 South Dakota 47 Oklahoma 35
Kentucky 48 Alabama 36 Arkansas 49 Iowa 3
7 Mississippi 50 Montana 38 Source
DeVol and Kuepp (2004).
25Table 11. Selected Measures of Metropolitan
Innovative Environment
-
- A. Innovative Activity
- PATENT Number of patents issued per 1000
population - (USPTO, 1990-99)
-
- ARD Academic RD expenditures per 1000
population - (NSF, 1998-2000)
-
- SED Doctorates awarded in science and
engineering per 1000 - population (NSF, 1998-2000)
-
- GSS Graduate science and engineering students
per 1000 population - (NS, 1998-2000)
-
- ETEC Percentage of employment in technical
professions - computer science engineering
except civil natural, physical, - and social science (BLS,
2000)
26Table 11. Selected Measures of Metropolitan
Innovative Environment (cont.)
B. Labor Force Quality PHSG Percentage of
adult population (25) that are high school
graduates (CBP, 2000) PCG Percentage of
adult population (25) that are college
graduates (CBP, 2000) PWP Percentage of
population (age 16-64) that are employed
(Census, 2000)
27Table 11. Selected Measures of Metropolitan
Innovative Environment (cont.)
C. Entrepreneurial Environment PCEST
Percentage change in number of establishments
(CBP, 1990-2000) PEL2O Percentage of
establishments with fewer than 20
employees (BLS, 2000) INC500 Number of
Inc 500 companies per 100,000 population
(www.inc500.com, 2000) VCAP Venture
capital investments () per capita (Price
Waterhouse Coopers, 2000) EMB Percentage
of employment in managerial and business
professions (BLS, 2000)
28Table 11. Selected Measures of Metropolitan
Innovative Environment (cont.)
D. Agglomeration Economics HTEMP
Percentage of employment in high-technology
industries (CBP, 2000) HTEST
Percentage of establishments in high technology
industries (CBP, 2000) ITEMP
Percentage of employment in information
technology industries (CBP, 2000) ITEST
Percentage of establishments in information
technology industries (CBP, 2000)
E. Competitiveness in Global
Economy EXPORTS Exports as a percent of
gross metropolitan product, metro
areas ranked in quantiles (DOC, 1999)
29Table 12. Metropolitan Areas in Regional
Innovation Systems Cluster Groupings
- Outliers (4)
- Atlanta, GA CMSA
- Austin, TX MSA
- Raleigh, Durham, Chapel Hill, NC
- CMSA
- Baton Rouge, LA MSA
- High (12)
- Dallas-Fort Worth-Arlington, TX CMSA
- Houston-Galveston-Brazoria, TX CMSA
- Huntsville, AL MSA
- Melbourne-Titusville-Palm Bay, FL MSA
- Orlando, FL MSA
- Pensacola, FL MSA
- Richmond-Petersburg, VA MSA
- San Antonio, TX MSA
- Sarasota-Bradenton, FL MSA
- Tampa-St. Petersbusrg-Clearwater, FL
- MSA
- Tulsa, OK MSA
- West Palm Beach-Boca Raton, FL MSA
30Table 12. Metropolitan Areas in Regional
Innovation Systems Cluster Groupings (cont.)
- College Towns (5)
- Athens, GA MSA
- Bryan-College Station, TX MSA
- Charlottesville, VA MSA
- Gainesville, FL MSA
- Tallahassee, FL MSA
- Medium (20)
- Augusta-Aiken, GA-SC MSA
- Birmingham, AL MSA
- Charleston-North Charleston, SC MSA
- Charlotte-Gastonia-Rock Hill, NC-SC MSA
- Cincinnati-Hamilton, OH-KY-IN MSA
- Columbia, SC MSA
- Greensboro--Winston-SalemHigh Point,
- NC MSA
- Greenville-Spartanburg-Anderson, SC MSA
- Jackson, MS MSA
- Jacksonville, FL MSA
- Knoxville, TN MSA
- Lexington, KY-IN MSA
- Memphis, TN-AR-MS MSA
- Nashville, TN MSA
- New Orleans, LA MSA
- Norfolk-Virginia Beach-Newport News,
31Table 12. Metropolitan Areas in Regional
Innovation Systems Cluster Groupings (cont.)
- Below Average (47)
- Abilene, TX MSA
- Albany, GA MSA
- Alexandria, LA MSA
- Amarillo, TX MSA
- Ashville, NC MSA
- Auburn-Opelika, AL MSA
- Beaumont-Port Arthur, TX MSA
- Biloxi-Gulfport-Pascagoula, MS MSA
- Chattanooga, TN-GA MSA
- Clarksville-Hopkinsville, TN-KY MSA
- Columbus, GA MSA
- Corpus Christi, TX MSA
- Decatur, AL MSA
- Dothan, AL MSA
- Enid, OK MSA
- Evansville-Henderson, IN-KY MSA
- Fayetteville, NC MSA
Fort Smith, AR-OK MSA Fort Walton Beach, FL
MSA Goldsboro, NC MSA Greenville, NC
MSA Hattiesburg, MS MSA Hickory-Morganton-Leno
ir, NC MSA Jackson, TN MSA Jacksonville, NC
MSA Jonesboro, AR MSA Killeen-Temple, TX
MSA Lafayette, LA MSA Lake Charles, LA
MSA Lakeland-Winter Haven, FL MSA Lawton, OK
MSA Little Rock-North Little Rock, AR
MSA Long View-Marshall, TX MSA Lubbock, TX
MSA Lynchburg, VA MSA
32Table 12. Metropolitan Areas in Regional
Innovation Systems Cluster Groupings (cont.)
- Below Average (47) (cont.)
- Macon, GA MSA
- Mobile, AL MSA
- Monroe, LA MSA
- Montgomery, AL MSA
- Myrtle Beach, SC MSA
- Odessa-Midland, TX MSA
- Owensboro, KY MSA
- Panama City, FL MSA
- Pine Bluff, AR MSA
- Rocky Mount, NC MSA
- San Angelo, TX MSA
- Savannah, GA MSA
- Sherman-Denison, TX MSA
- Shreveport-Bossier City, LA MSA
- Sumter, SC MSA
- Tuscaloosa, AL MSA
- Tyler, TX MSA
6. Low (18) Anniston, AL MSA
Brownsville-Harlingen-San Benito, TX MSA
Danville, VA MSA Daytona Beach,
FL MSA El Paso, TX MSA
Florence, AL MSA Fort Myers-Cape Coral,
FL MSA Fort Pierce-Port St. Lucie, FL
MSA Gadsden, AL MSA Houma, LA
MSA Huntington-Ashland, WY-KY-OH MSA
Johnson City-Kingsport-Bristol, TN-VA
MSA Laredo, TX MSA
McAllen-Edinburg-Mission, TX MSA
Naples, FL MSA Ocala, FL MSA
Punta Gorda, FL MSA Texarkana,
TX-Texarkana, AR MSA
33Map 1 Persistent Poverty and RIS Counties,
Southeastern United States, 2000
34Map 2 Persistent Poverty and RIS (Including
Medium) Counties, Southeastern United States, 2000
35(No Transcript)
36Table 14. Changes in Aggregate Economic Activity
by Cluster Groupings, 1990-2000
a Number of metro or nonmetro counties in the
cluster grouping.
37Table 14. Changes in Aggregate Economic Activity
by Cluster Groupings, 1990-2000 (cont.)
a Number of metro or nonmetro counties in the
cluster grouping.
38Table 14. Changes in Aggregate Economic Activity
by Cluster Groupings, 1990-2000 (cont.)
B. Monmetro Counties Outliers (31)
87.28
81.02 89.38 High
(40) 78.54
73.43 80.05
College Towns (24) 79.69
70.61 76.45
Medium (136)
72.84 71.88
66.89 Below Average (315)
60.05 52.99
53.77 Low (42)
68.31 61.73
61.65 Rural LMAs
(349) 65.16
59.85 59.29
39Table 14. Changes in Aggregate Economic Activity
by Cluster Groupings, 1990-2000 (cont.)
B. Monmetro Counties Outliers (31)
32.74
23.00 High (40)
31.27 22.01
College Towns (24)
25.29 22.22
Medium (136)
21.33 12.25
Below Average (315)
15.89 7.06 Low
(42)
19.55 12.83
Rural LMAs (349)
17.88 10.39
40Table 15. Changes in Per Capita Economic
Activity by Cluster Groupings, 1990-2000
A. Metro Counties Outliers (32)a
51.89 96.20
High (58) 40.25 69.04
College Towns (13) 39.10 62.29
Medium (113) 42.34 54.02
Below Average (106) 37.10 47.60
Low (33) 31.13 40.62
a Number of metro or nonmetro counties in the
cluster grouping
41Table 15. Changes in Per Capita Economic
Activity by Cluster Groupings, 1990-2000 (cont.)
A. Metro Counties Outliers (32)a
58.20 -9.81
High (58) 51.29 -5.43
College Towns (13) 45.88 -17.01
Medium (113) 53.26 -12.07
Below Average (106) 53.74 -11.41
Low (33) 47.09 -12.91
a Number of metro or nonmetro counties in the
cluster grouping.
42Table 15. Changes in Per Capita Economic
Activity by Cluster Groupings, 1990-2000 (cont.)
Change in Earnings Change in
Earnings
Per Worker by Per Employed Resident
Cluster Grouping Place
of Work by Place of Residence
() ()
B. Monmetro Counties Outliers (31)
37.16
60.97 High (40)
31.88 53.04
College Towns (24)
36.47 49.98
Medium (136)
39.87 41.86
Below Average (315)
31.90 30.71 Low
(42)
34.92 37.41
Rural LMAs (349)
35.63 35.79
43Table 15. Changes in Per Capita Economic
Activity by Cluster Groupings, 1990-2000 (cont.)
Change in
Change in
Per Capita Share of
Population Cluster Grouping
Personal Income
in Poverty
()
()
B. Monmetro Counties Outliers (31)
52.55
-13.70 High (40)
44.10 -8.05
College Towns (24)
47.29 -14.37
Medium (136)
53.32 -16.40
Below Average (315)
48.77 -12.19 Low
(42)
49.97 -7.52
Rural LMAs (349)
49.96 -13.97
44Table 16. Regression Results for Change in
Nonmetro County Population and Employment,
1990-2000
Population Equation Employment
Equation
Variable Coefficient
t-value Coefficient
t-value
45Table 17. Regression Results for Change in
Nonmetro County Earnings, 1990-2000
Earnings by Place of Work Earnings by Place
of Residence
Variable Coefficient
t-value Coefficient
t-value
46Table 18. Regression Results for Changes in
Nonmetro County Earnings Per Worker, 1990-2000
Earnings by Place of Work Earnings by Place
of Residence
Variable Coefficient
t-value Coefficient
t-value
47Innovation Policies for Non-RIS
Regions(Rosenfeld, 2002 and Tödtling, 2004)
- Industry Clusters
- Support clusters in new industries
related to existing
industrial base - Strengthen emerging/potential clusters
- in the region
48Innovation Policies for Non-RIS
Regions(Rosenfeld, 2002 and Tödtling, 2004)
(Continued)
- New Firms
- Promote entrepreneurship and new firm
development - Attract cluster-related firms
49Innovation Policies for Non-RIS
Regions(Rosenfeld, 2002 and Tödtling, 2004)
(Continued)
- Knowledge and Innovation
- Develop cluster-specific technology
centers - Attract branches of national research
organizations - Build up and attract new labor skills
50Innovation Policies for Non-RIS
Regions(Rosenfeld, 2002 and Tödtling, 2004)
(Continued)
- Networks
- Link firms to local and external knowledge
providers - Technology transfer programs