DAN BREZNITZ IS RIGHT to question what struggling regions stand to gain from the Silicon Valley model of regional development. Estimates from the Brookings Institution indicate that just 5 metro areas accounted for 9 out of 10 new high-tech jobs between 2005 and 2017. Efforts to replicate this model elsewhere have typically failed because localities chase the outputs of an innovative region—large tech firms and high-growth startups—rather than cultivating the inputs: highly skilled individuals and technical infrastructure. As a result, tech companies and the people they aim to recruit mostly continue to flock to the places where the inputs for innovation already exist, and struggling regions remain stuck. For an alternative, Breznitz cites thriving places from China to Italy where firms innovate in more incremental ways than the likes of venture-backed unicorns.
What can places like Cobalt and Cleveland learn from these examples? Breznitz paints in broad strokes, pointing to the value of fostering an “innovation ecosystem.” Exactly what this means is unclear, but presumably it includes a constellation of organizations operating outside the free market dedicated to promoting economic development: government agencies, industry associations and private foundations, and universities and community colleges.