The IPL newsletter: Volume 18, Issue 366

News from the IPL


Amazon Announces Plans for a Second HQ, Looks to be Wooed

Thuy Ong, The Verge
Amazon has announced plans to open a second company headquarters called HQ2 somewhere in **North America, equivalent to its massive base in Seattle. Amazon says it will invest around $5 billion in the construction and operation of the new headquarters. It’s planning to grow it to provide 50,000 jobs, and has opened up proposal requests for cities interested in hosting the company. Amazon says it has preferences for a city that has more than 1 million people, a stable and business-friendly environment, and locations that can attract and retain technical talent. Under a “decision drivers” part, Amazon asks cities to identify incentive programs available for HQ2 including tax credits/exemptions, relocation grants, workforce grants, utility incentives, permitting, and fee reductions. Amazon notes that “the initial cost and ongoing cost of doing business are critical decision drivers.”

Editor's Pick

The End of Carbon-Based Energy is Looming

David A. Wolfe, Innovation Policy Lab
Since the Industrial Revolution in the 1700s, the world economy has been powered by a carbon-intensive energy paradigm that has led to unprecedented improvements in the standard of living for most of the global population. That prosperity has largely been driven by the use of carbon-intensive resources — coal, petroleum and natural gas — to power steam, electric and internal combustion power sources, for almost three centuries. Our dependence on these energy sources is so extensive that it is hard to imagine an end to the carbon era. Nonetheless, evidence from a wide range of sources is growing that the transition to a post-carbon energy economy is gaining momentum. While governments around the world focus their policy efforts on creating a framework to regulate or entice producers and consumers off their reliance on carbon-based energy, relatively few seem prepared for a world in which both the supply of alternative energy sources and the demand for them are driving this change at a faster pace than their regulatory frameworks can.

Innovation Policy

The Labour Market Shift: Training a Highly Skilled and Resilient Workforce in Ontario

Institute for Competitiveness and Prosperity
In this working paper, the Institute examines Ontario’s changing labour market and skills, employer-driven training, and government skills training programs. Ontario’s labour market has changed. For Ontarians to remain resilient in face of this change, they must be equipped with skills that are transferable across occupations and sectors. Two core findings are that: (1) Most workplace spending on training is concentrated among large, private-sector firms and for highly educated individuals; and, (2) Employment Ontario programs have not kept pace with the changing labour market. The report proposes ten recommendations for employers, government, and educational institutions to prepare Ontario’s workforce to be resilient in the face of current and future labour market shifts.

Clusters & Regions

Capturing the Next Economy: Pittsburgh’s Rise as a Global Innovation City

Scott Andes, Mitch Horowitz, Ryan T. Helwig, and Bruce Katz, Brookings
Few cities have experienced the economic upheaval that Pittsburgh did in the 1970s and 1980s—and come back. During the country’s industrial heyday, the city swelled in population and income. Yet by 1980, global economic forces had shuttered much of the U.S. steel industry, and Pittsburgh’s unemployment rate reached 18 percent as Western Pennsylvania effectively experienced a second Great Depression. Today, the competitive advantage of the region is no longer its rivers and raw materials but its high-skilled workers, world-class research institutions, and technology-intense advanced manufacturing. In 2016, for example, the region’s per capita university research and development (R&D) spending was nearly two and a half times the national average. While these assets are considerable, they also place Pittsburgh in competition with a number of other innovation cities that are rapidly investing billions in a suite of new technologies and industries poised to reshape the global economy. As in the past, the cities at the forefront of these economy-shaping technologies will be the focal points of global capital, talent attraction, and firm growth. If approached correctly, follow-along economic activity and investment will in turn lead to more and better-paying jobs—with varying skill-level needs and across multiple sectors of the economy—and higher revenues that can be reinvested in education, workforce development, infrastructure, and neighborhood revitalization.

15 Innovations that Shaped the City

Sidewalk Labs
One of the many problems with the term “smart cities” is its suggestion that urban life has been dumb in the past. The engineers who designed Rome’s aqueducts might rightfully object. So too the surveyors who outlined New York’s street grid or the tunnelers who dug London’s subways. In reality, cities have been humanity’s greatest source of innovation as long as people have settled in them; their complexity presents endless challenges and their environment inspires endless solutions. With an eye toward the future of cities, Sidewalk Talk is excited to launch a new series spotlighting 15 innovations that shaped the history of urban life. Over the coming weeks, post in this series will explore some of the biggest steps forward — and, at times, backward — in transportation, buildings, energy, data, and infrastructure. Many are technological in nature; others represent innovative policies or design advances.

Statistics & Indicators

The Untold Story of the Varied Middle: Local Economic Conditions 2017

National League of Cities
Rural vs. urban. It’s a simple yet compelling narrative about the dichotomous relationship between place and economic growth. It has become our frame of reference for everything from the opioid epidemic to national election results. Often this characterization is meaningful, particularly to describe post-recession economic trends in the broadest of terms. But digging deeper reveals an even more dynamic economic landscape, particularly among mid-sized cities. This report gauges the performance of key local economic indicators from the unique vantage point of those who are held most accountable for prosperity and equity in cities: their chief elected offcials. This year’s results are based on responses from 224 cities across population sizes and locations within and outside metropolitan areas. The authors conducted a cluster analysis to clearly identify how specific economic factors converge and give rise to distinct types of local economies. Five groupings of local economies emerged: a highly rural cluster; a large central city cluster; and three distinct types of mid-sized local economies. The report defines these economic types to offer an aggregate picture of local economic trends while recognizing the variations across cities.

An Analysis of Job and Wage Growth in the Tech/Telecom Sector

Dr. Michael Mandel, Progressive Policy Institute
This paper examines job growth at leading tech/telecom firms. It compares them to leading industrial firms, both in the first half of the 20th century and in the post-war era, and show that they have similar employment trajectories. Then it considers wage and industrial structure trends. The paper finds that real wages in the tech/ telecom sector are higher and rising faster than in the physical sector. To correct for composition effects, the author examined detailed occupational categories and find that, for middle-skill occupations such as sales and office support, the tech/telecom sector has significantly higher wages than the physical sector.

Policy Digest

12 Principles Guiding Innovation Districts

Julie Wagner, Scott Andes, Steve Davies, Nathan Storring, and Jennifer S. Vey, Brookings
Ignited by emerging economic trends and demographic preferences, many cities across the United States, Europe, and other global regions are witnessing a new geography of innovation: innovation districts. Drawing on the work of the Anne T. and Robert M. Bass Initiative on Innovation and Placemaking, and other work globally, this report develops these 12 principles to guide how innovation districts are to grow and evolve—a process that requires cities to take an integrated approach.

  1. The clustering of innovative sectors and research strengths is the backbone of innovation districts. The concentration of innovative sectors and research strengths is what drives innovation districts from the start. Rather than government attempting to pick industry winners or developers focusing on a real estate play, districts thrive by concentrating and leveraging their city or regional economic strengths. For example, Oklahoma City’s strengths include health care and energy, while in Eindhoven, The Netherlands, it is precision machinery. Bottom line: Cities need to grow their own firms and, when possible, recruit from elsewhere.
  2. For innovation districts, convergence—the melding of disparate sectors and disciplines—is king. Many economic developers think about the world in terms of industry verticals (e.g., agriculture, aerospace, health care). But innovation platforms—IT, new materials, robotics—are technology enablers that serve many industries. As hubs of research and next-generation technologies, innovation districts are more aptly defined by these horizontal platforms than by sectorial silos. As such, district stakeholders need to build their capacity to connect seemingly dissimilar industries through collaborative research, conversation, and cross-cutting technologies.
  3. Districts are supercharged by a diversity of institutions, companies, and start-ups. The strength of innovation districts comes, in part, from this eclectic mix. Districts that are largely comprised of large institutions often lack the accelerated innovative growth that small, nimble firms provide. And districts characterized by a density of start-ups have fewer opportunities for well-funded partnerships and alliances. The “magic in the mix” comes from aligning incentives between these and other public, private, academic, and civic institutions.
  4. Connectivity and proximity are the underpinnings of strong district ecosystems. A well-connected district is paramount to its success—transit, bike paths, sidewalks, car-sharing, and high-speed fiber. Identify gaps and invest wisely. At the same time, districts should measure their success by steps not miles. The experience of proximity—or a physical concentration of firms, workers, and activities—is what differentiates a “buzzing” district from a boring one.
  5. Innovation districts need a range of strategies—large and small moves, long-term and immediate. Innovation district development requires a mix of large investments (e.g., in transit, high-speed fiber, venture and other capital funds) and smaller strategies (e.g., reactivating a neglected park and programming spaces). These approaches are complimentary: Large-scale investments set the foundation upon which other activities can be layered, while short-term, community-led processes can inform bigger and lengthier undertakings and create crucial momentum.
  6. Programming is paramount. Programming—a range of activities to grow skills, strengthen firms, and build networks—is the connective tissue of a district. A major misstep is to undervalue programming within and across the district, both indoors and out.
  7. Social interactions between workers—essential to collaboration, learning, and inspiration—occur in concentrated “hot spots.” A handful of social hot spots in a district will likely punch far above their weight in terms of building community. They may be organic, like Silicon Valley’s legendary Walker’s Wagon Wheel, or designed, like Venture Café near the MIT campus. Districts should identify, analyze, protect, and support such exceptional places.
  8. Make innovation visible and public. Daylighting innovation in public and private spaces helps inspire curiosity in aspiring innovators, start conversations between neighbors, and convey the story of an innovation district to potential recruits or investors. It also transforms public spaces into “living labs” to test prototypes. To help further, activities like hackathons (a sprint-like event encouraging collaboration generally on software/hardware development), symposiums, and health clinics, which typically occur indoors, might accomplish more in the public realm. And finally, greater transparency at the ground level of buildings allows pedestrians to connect with the innovation activities inside.
  9. Embed the values of diversity and inclusion in all visions, goals, and strategies. Innovation districts not only promote new technologies, they grow a range of new firms and new jobs with living wages. At a time of rising social inequality, innovation districts must become an avenue to economic opportunity for city residents—particularly for those in nearby neighborhoods that struggle with poverty and disinvestment. But growth alone is not enough. Only through intentional training, hiring, business development, and placemaking efforts can districts cultivate new local talent, encourage more diverse ownership structures, and help address poverty and disinvestment in surrounding communities.
  10. Get ahead of affordability issues. Successful districts can, over time, drive up market pressures, impacting the ability of start-ups, maturing firms, and neighboring residents to remain in these areas. Smart districts respond early, getting ahead of the curve through a range of policy moves and strategic projects that preserve affordability and the diversity it engenders.
  11. Innovative finance is fundamental to catalyzing growth. Most innovation districts require new finance streams to advance innovative and inclusive growth without straining existing and limited resources. As districts will likely receive less funding from states and the federal government to support their efforts, creative financing tools—including ways to leverage city-owned and district assets—should be explored with an eye toward sustaining financing over time.
  12. Long-term success demands a collaborative approach to governance. An innovation district’s work ethic and culture is “collaborate to compete.” A bottom-up horizontal governance model—involving business, academic and civic institutions, government, workers, and residents—can best orchestrate what must be done collectively: Identifying assets; design, finance and strategic initiatives; public space management; and evaluating progress.


SSTI Annual Conference: Building Bridges for a Better Future

Washington, D.C., 13-15 September, 2017
“We chose the theme after hearing from our members and others in the field about the importance of reaching outside of our traditional networks and imagining what the future may hold for those in the innovation economy,” said Dan Berglund, SSTI president and CEO. “We’re excited to hold the conference in the nation’s capital, and share the stories of successes, along with the challenges, that stakeholders in science, technology, innovation and entrepreneurship are facing.” Conference attendees will have the opportunity to gather on Capitol Hill, relate stories that are important to them, hear about best practices from SSTI Creating a Better Future award winners, engage with their peers in the field, and make new connections through the many sessions that will be offered. 

The Innovation Policy Lab Speaker Series
Calestous Juma
New Technological Anxieties: In Search of Inclusive Innovation Strategies

Toronto, 18 September, 2017
Current advances in artificial intelligence and robots have rekindled social anxieties over the impact of new technologies on employment. The concerns have inspired a series of responses which include taxing robots and providing guaranteed minimum basic income. Others, however, argue that the adoption of new technologies will alter the structure of employment without leading to net job losses. This lecture argues that lessons from historical trends may not be useful sources of ideas for addressing the challenges. This is because of significant differences in the pace of change, global scope of disruptions and breadth of public perceptions on relations between innovation and economic inequalities. The combined impacts of these dynamics could hamper innovation and undermine the ability of society to benefit from technological advances. The lecture proposes the adoption of national policies that promote inclusive innovation. The lecture draws from the speaker’s new book, Innovation and Its Enemies: Why People Resist New Technologies which analyses case studies of technological controversy over the last 600 years.

Atlanta Conference on Science and Innovation Policy

Atlanta, USA, 9-11 October, 2017
The Atlanta Conference on Science and Innovation Policy provides a showcase for the highest quality scholarship addressing the multidimensional challenges and interrelated characteristics of science and innovation policy and processes. Spanning three days, the conference will include plenary sessions reflecting different facets of the science and innovation system, presentations of well-developed research, and an early career poster session to allow young researchers to present their work. Submissions should address issues relevant to the science and innovation system, and may fall into one or more topic areas related to the STI/research system.

12th Regional Innovation Policies Conference RIP2017

Santiago de Compostela, Spain, 26-27 October, 2017
The 12th Regional Innovation Policies Conference (RIP2017) will be held at the University of Santiago de Compostela, in Galicia (Spain). The conference will be organized by the ICEDE Research Group and it will take place on the 26th and 27th of October 2017 at the Faculty of Economics and Business, coinciding with the 50th anniversary of economics studies in Galicia. The conference is a venue for researchers, practitioners and policy-makers with an interest in regional innovation, regional development and innovation policy. Participants are encouraged to submit papers on topics in relation to the conference themes listed in the full call for papers.

Canadian Science Policy Conference

Ottawa, 1-3 November, 2017
As the nation celebrates Canada’s 150th birthday, CSPC also invites you get engaged with CSPC 2017 and celebrate the science and innovation policy accomplishments together. We invite you to submit your suggestions and event proposals.

WICK2017: 5th PhD Workshop Economics of Innovation, Complexity and Knowledge

Turin, Italy, 19-20 December, 2017
The aim of the workshop is to bring together young researchers from different disciplines and provide them a circumstance of discussion of both full and early works. The main topics the workshop will cover are Economics of Science, Firm and Regional Innovation Strategies, HR Analytics and Economic Philosophy. The event will feature keynote contributions from Dr. Frank Neffke and Dr. Torsten Heinrich.

GeoInno2018: 4th Geography of Innovation Conference

Barcelona, Spain, January 31st, 2017 – February 2, 2018
The aim of this event is to bring together some of the world’s leading thinkers from a variety of disciplines ranging from economic geography, innovation economics, and regional science, as well as economics and management science, sociology and network theory, and political and planning sciences.

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This newsletter is prepared by Jen Nelles.
Project manager is David A. Wolfe.