The IPL newsletter: Volume 18, Issue 375

Growing the Future: State Efforts to Advance the Life Sciences

Joe Kennedy, ITIF
Life-sciences companies—especially pharmaceutical, biotech, and medical-device companies—have been steadily increasing their U.S. economic output and employment in high-skilled, high-wage jobs. But not all states are equally well positioned to grow and attract these companies. That’s because while life-sciences companies have significant flexibility to conduct their research, clinical trials, and production anywhere in the world, they grow best in locations that can combine qualities like a good business environment, skilled workers, strong research universities, and available capital. Strengthening these and related factors can give states a stronger competitive advantage. At least 27 states have specific life-sciences-focused economic development efforts. This report examines how five—Colorado, Indiana, New Jersey, North Carolina, and Washington—are working to create environments that support the growth of their life-sciences sectors.

Is Tech Dividing America?

Nancy Scola, Politico
When Americans consider how technology has changed their lives, they tend to focus on how the internet and smartphones have altered how they watch TV, connect with friends, or how they shop. But those changes pale in comparison to how technology has already restructured the economy, shaking up the workforce and shifting opportunity to tech-centric urban hubs. As artificial intelligence quickly moves from fiction to daily reality, that revolution will arguably become much more consequential. Economists broadly agree that technology will continue to be an engine of economic growth. But it also will upend old certainties about who benefits. Already, we can see a growing inequality gap, with winners and losers by region and workplace. The next wave of changes, handled badly, could make this gap even more extreme. In this article, Nancy Scola interviews MIT researcher and author David Autor who has a newly keen interest in figuring out how the technologies being pumped in to the labor market would shape what it means to be a worker in the United States.

Blockchain Technology Overview

NIST
Blockchains are immutable digital ledger systems implemented in a distributed fashion (i.e., without a central repository) and usually without a central authority. At its most basic level, they enable a community of users to record transactions in a ledger public to that community such that no transaction can be changed once published. This document provides a high-level technical overview of blockchain technology. It discusses its application to electronic currency in depth, but also shows its broader applications. The purpose is to help readers understand how blockchains work, so that they can be appropriately and usefully applied to technology problems. Additionally, this document explores some specific blockchain applications and some examples of when a blockchain system should be considered for use.

High Growth Firms and Cities in the U.S.: An Analysis of the Inc. 5000

Ian Hathaway, Brookings
Each year, Inc. Magazine publishes its list of the fastest-growing businesses in America — the Inc. 5000. To qualify, companies must be independent, privately-owned, domiciled in the United States, and meet certain revenue thresholds. Of qualifying companies, those with the fastest three-year revenue growth rates are selected. Inc. 5000 firms exhibit very high growth compared with their peers, which makes them vital to the economy. For example, the companies analyzed here increased revenue by 43 percent each year at the median and employment by 35 percent at the median. By comparison, the median business for the whole economy expands revenue by about three percent each year and doesn’t increase employment at all. In view of that, this article analyzes the Inc. 5000 data for the years 2011 to 2017, with a focus on those companies meeting the standard definition of high-growth established by the Organization for Economic Co-operation and Development (OECD). The industry representation of these companies, their geographic distribution across the U.S., and factors explaining regional variation of Inc. 5000 high-growth firm “density” are explored.

Causal Relations Between Knowledge-Intensive Business Services and Regional Employment Growth

Thomas Brenner et al., Regional Studies
This paper studies the causal relations between regional employment growth in knowledge-intensive business services (KIBS) and overall regional employment growth using German labour-market data for 1999–2012. Adopting a recently developed technique, it uses a structural vector autoregressive model in which the causal directions between KIBS and other sectors are examined including various time lags. Results show that although regional growth has a negative short-term effect on KIBS, KIBS growth has a long-term positive effect on the whole regional economy. This confirms the claim that KIBS can play a key role in regional policies.