SSTI Digest

Faculty of the nation’s higher education institutions have long used research publications and citations as a measure of success. A new working paper posted by the National Bureau of Economic Researchers (NBER) suggests a select group of research publications may do more than gain the authors tenure and celebrity in their chosen field: these works are correlated with reductions in local disease-related mortality. In an era of marked increases in anti-intellectualism among legislatures, is this finding an additional argument to add to TBED policymakers’ arsenal for increasing state and regional investments targeting R&D?

Does Research Save Lives? The Local Spillovers of Biomedical Research on Mortality, written by Rebecca McKibbin (University of Sidney) and Bruce A. Weinberg (Ohio State University), reports the findings of the authors’ study using the PubMed database, the geographic location of the publishing biomedical researchers, and the timing and intensity of local mortality rates by disease. They conclude each “additional research publication on average reduces local mortality from a disease by 0.35 percent.” 

The New Mexico Economic Development Department released a new strategic plan that identifies core challenges to the state and a multi-part approach to the future. The six challenges include talent attraction, misalignment between higher education and industry, public sector “dominance” of innovation, and concentration in a few industries. The plan includes recommendations related to the state’s innovation economy: develop state-sponsored investment funds to match investments in target industries; help academic researchers to advance new technologies; establish persistent funding for incubators and accelerators; fund university-industry research partnerships; and, develop a mentorship network across entrepreneurship support organizations in the state.

The Economic Development Administration (EDA) recently announced it received more than 500 applications to its Build Back Better Regional Challenge (BBBRC. Applicants are competing for 50 to 60 Phase 1 awards of $500,000 each to support the planning of “bottom-up, middle-out” economic development projects designed to advance and accelerate an equitable economic recovery, create good-paying jobs, and build resilient regions across the country. Winners of the Phase 1 awards will go on to develop a full proposal for Phase 2, and in March between 20 and 30 of the projects will receive up to $100 million each to implement their projects.

President Joe Biden this morning delayed his planned departure for Europe to announce a framework for the Build Back Better Act, a $1.75 trillion plan that the president said he was confident could pass both houses of Congress. While the Build Back Better Framework is not as large as initially proposed, the White House says it represents the largest effort to date to combat climate change, promises to create millions of good-paying jobs, spur long-term growth and meet clean energy ambitions. The plan includes $40 billion for higher ed and workforce by raising the maximum Pell Grant and providing support to Historically Black Colleges & Universities, Hispanic Serving Institutions, Minority Serving Institutions, and Tribal Colleges and Universities. It also would invest in workforce development, including community college workforce programs, sector-based training, and apprenticeships.

Five clusters have been added to the U.S. Small Business Administration’s (SBA) Regional clusters Initiative, according to information available through USASpending. The Regional Cluster Initiative was launched in 2010 to maximize the potential of clusters and better support small businesses. The initiative connects innovation assets so that small businesses can effectively leverage them to commercialize new technologies and expand into new markets.

While the SBA has not formally announced the winners, the five new award recipients listed on USASpending.gov  as receiving funding include AgLaunch Engine, LLC ($300,000); Development Capital Networks, LLC ($299,932); Acendian, LLC ($292,760); Larta, Inc., ($225,000); and Startup Junkie Consulting, LLC ($201,633). As with previous RIC awards, each organization has the potential to renew these awards through up to four additional option years (with a corresponding increase in the value of the contracts). At this time, it is not clear which clusters these organizations will be supporting.

Support for small companies has long been a pillar of federal and state policies meant to drive business formation, job creation, and the resulting spillover economic benefits for regional economies. The debate remains, however, about whether smaller or larger businesses play an outsized role in the nation’s economy. This edition of Useful Stats provides some context to the argument, finding that although smaller and newer establishments accounted for the greatest amount of total job creation, job losses from small business closures reduced the group’s net job creation significantly, leaving larger companies to account for the greatest share of net job creation in 2019.

Foundations, in almost all of their stripes, represent an underutilized but often willing partner to encourage regional innovation. Relationships may take time to nurture, but the resulting collaborations can be of critical importance for advancing your local TBED agenda. To spur your thinking, the six examples below from the past three weeks alone show the various ways foundations are stepping up to help support regional innovation and entrepreneurship. On the principal or endowment management side of a foundation, they can be and have been willing partners for seeding or co-investors in a local early stage equity capital fund.

Indiana and Illinois are two of the most recent states to implement innovation voucher programs, adding another tool to their efforts to increase economic activity among innovators and entrepreneurs.

Innovation vouchers are provided by governments to small businesses and help foster R&D with access to additional funding and resources. Depending on their design, they can incentivize collaboration between firms and public knowledge providers, such as universities and research institutes, and increase accessibility to crucial resources, such as lab space and specialized equipment, that small businesses would otherwise not have access to.

The findings from a recent webinar and report suggest that Employment Social Enterprises (ESEs) are significant market-based mechanisms that can address workforce misalignment by supplying employers with skilled workers while increasing economic mobility and addressing structural employment barriers. Business for Impact at Georgetown University’s McDonough School of Business recently delivered the webinar and report on Jobs for All: Employment Social Enterprise and Economic Mobility in the United States.

Greater investment in basic scientific research, as opposed to applied research, is more likely to drive stronger long-term economic growth, induce a knowledge spillover effect, increase productivity ROI, and encourage more public-private collaboration, according to a group of economists at the International Monetary Fund. They found that basic research is an essential input into innovation and the economists explain its importance in a recent post on the IMFBlog titled Why Basic Science Matters for Economic Growth.

With the regular budget process stalled for the time being, Senate Democrats released their draft bills for the remaining three-quarters of the FY 2022 federal budget. Included in these proposals are substantial increases for Build to Scale and the Small Business Administration’s innovation programs, as well as funding for a new Directorate for Technology, Innovation and Partnerships (TIP) at the National Science Foundation. The draft bills are another positive indicator for how Congress may invest in science, technology, innovation and entrepreneurship in the near future, but the path forward remains uncertain.

The bills released by the Senate majority earlier this week include legislation funding the Department of Commerce, science agencies and SBA, among others. Highlights for regional innovation economies include the following:

New York City and the state of Illinois have both made moves recently to shift more of their economies to clean energy. Mayor Bill de Blasio and the New York City Economic Development Corporation (NYCEDC) announced a 15-year, $191 million Offshore Wind Vision (OSW) plan to make New York City a leading destination for the offshore wind industry.  Last month, Illinois Gov. J.B. Pritzker signed sweeping legislation offering new incentives for the adoption of clean energy and aim to move it to 100 percent clean energy by 2050. And Massachusetts Gov. Charlie Baker is looking to use American Rescue Plan Act (ARPA) money to establish a clean energy investment fund.