Measuring Innovation: Determining regional innovation capacity

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Measuring InnovationDetermining regional
innovation capacity

• Robin Gaster Ph.D
• President, North Atlantic Research Inc..

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Overview

• Background globalization, innovation, and the
  regional dimension
• Economic innovation as ecology
• Metrics and the power of regional benchmarking
• The Regional Innovation Index one possible
  framework for assessing policy

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Globalization and innovation

• Global trade and investment continue to grow
  rapidly
• High wage regions like the US and EU face a
  growing innovation imperative
• Only at the cutting edge of the economy can high
  wages be maintained. Commodity production goes
  elsewhere.
• Competition between high wage regions is growing
  rapidly.
• Low wage countries are advancing rapidly
• So, innovation is key to our economic future

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Measuring innovation 5 imperatives

• Regions are key
• National data obscure more than reveal
• International data are not comparable
• Use multiple indicators and metrics
• No single indicator works
• Benchmark against other regions
• Be comprehensive, even if not all data are
  perfect
• Work in real time
• Policy happens while economists are perfecting
  theories

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Regional Innovation as Ecology

• Multiple possible inputs
• Multiple possible outputs
• Complex interactions
• Highly iterative
• Hard to define
• Harder still to measure

The branch of science concerned with the
relationships between organisms and their
environments.
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The Regional Innovation Index A possible
framework

• Based on input/output approach
• Includes multiple factors and numerous indicators
  within factors
• Built around a benchmarking framework
• Focused on policy

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Framework for Benchmarking Regional Innovation
Ecologies
OUTPUTS
INPUTS
Capital
Exogenous Change
Knowledge
Labor
Innovation
Firms
Individuals
Education
Long-term Outcomes
Policy Changes
Universities
Innovation Process
Economic units
RD inputs
Economic outputs
Social outputs
Internet
Quality of life
Capacity
Feedback loop
Globalization
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Framework for Benchmarking Regional Innovation
Ecologies
OUTPUTS
INPUTS
RD inputs Government RD spending DoD RTDE
spending Industry RD University RD SBIR ATP
awards
Capital
Exogenous Change
Knowledge
Labor
Innovation
Firms
i
Individuals
Education
Long-term Outcomes
Policy Changes
Universities
Innovation Process
Economic units
RD inputs
Economic outputs
Social outputs
Internet
Quality of life
Capacity
Feedback loop
Globalization
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Framework for Benchmarking Regional Innovation
Ecologies
OUTPUTS
INPUTS
Capital
Exogenous Change
Knowledge
Labor
Innovation

• RD inputs
• Includes
• Federal Labs and research centers
• Incubators
• Tech parks
• University-industry partnerships

i
Firms
Individuals
Education
Long-term Outcomes
Policy Changes
Universities
Innovation Process
Economic units
RD inputs
Economic outputs
Social outputs
Internet
Quality of life
Capacity
Feedback loop
Globalization
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Using the framework Results from the Regional
Innovation Index

• High tech leaders
• North Carolina, Washington, California, Maryland,
  Colorado, Oregon, Connecticut, Florida
• Industrial states MidWest Census Region
• Illinois, Indiana, Ohio, Michigan, Wisconsin

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NC Innovation Summary
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NC Innovation Strengths (sel.)
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NC Weaknesses (sel.)
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NC - Engineers
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NC Engineers - details
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NC Engineers Dynamic view
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Four Conclusions

• Benchmarking with the Index provides analytic
  power even when data are variable quality
• Data-driven analysis can help pose the right
  questions
• New software tools like the Index can do in
  minutes what took months only 5 years ago
• Regional analysis will drive innovation policy in
  the future, because it is
• Detailed
• Prescriptive
• Focused
• Important to regional actors

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• Robin Gaster
• 301-589-5965
• rgaster_at_north-atlantic.com