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Joe's Big Idea
Wed September 5, 2012
3 Clues To How Geography Fuels Innovation
The image of the lone genius toiling in isolation, finally emerging with a brilliant new concept is compelling, even romantic. Too bad it's not true.
Instead, innovation thrives in ecosystems, much as microbes flourish in a warm, cozy petri dish.
"There's an important geography to where innovation happens," says AnnaLee Saxenian, dean of the School of Information at the University of California, Berkeley, who studies how regional differences affect innovation.
"Innovation is a social process, not just an individual process," Saxenian says. Social interaction among people speeds incremental improvements in an idea. People both compete and collaborate to come up with something better. And old-fashioned physical proximity still seems to help the most, even in the age of the Internet.
Though Thomas Edison's obituary heralded him as "a solitary genius revolutionizing the world," he was not alone in that laboratory in Menlo Park, N.J. Instead, he had some 40 scientists and technicians there, laboring away on his inventions.
So having access to like-minded people is key, and the simplest way to do that is to live in a city. Which brings us to Clue No. 1: Go urban.
The world's 40 largest urban areas produce two-thirds of global economic output and 9 out of 10 patents, according to Richard Florida, a professor of business at the University of Toronto and frequent writer on innovation and regional development.
A cruise through the U.S. Patent and Trademark Office's most recent geographic data on patents awarded from 2006 to 2010 supports Florida's thesis. Here's the Top 10 list, with the number of patents awarded in 2010:
- San Jose-Sunnyvale-Santa Clara, CA (10,074)
- New York-Northern New Jersey-Long Island (6,383)
- San Francisco-Oakland-Fremont CA (6,290)
- Los Angeles-Long Beach-Santa Ana, CA (4,992)
- Boston-Cambridge-Quincy, MA (4,330)
- Seattle-Tacoma-Bellevue, WA (4,052)
- Chicago-Joliet-Naperville, IL (2,993)
- Minneapolis-St. Paul-Bloomington, MN (2,827)
- San Diego-Carlsbad-San Marcos, CA (2,993)
- Austin-Round Rock-San Marcos, TX (2,449)
Yet two-thirds of Americans live in cities, and many of those towns are not hotbeds of innovation. What gives?
Based on population alone, the New York City region and Los Angeles should be kings of innovation — at least the kind of innovation measured by patents, not by investments or Hollywood blockbusters. While both cities made the list, they were eclipsed by the far less populous Silicon Valley, where residents were awarded 10,074 patents in 2010, almost twice as many as the 6,383 given out in the New York region. (This map of patents per capita in 1998, though dated, reflects the fact that a large number of people alone isn't enough.)
So what does the Silicon Valley have that Chicago doesn't? Clue No. 2: innovation infrastructure.
When Steve Jobs and Steve Wozniak founded Apple Computer in 1976 in Silicon Valley, they had no problem finding engineers and other experts willing to share technical expertise, free parts, investors and legal advice.
Silicon Valley has another advantage — Stanford University. The school has strong ties with the surrounding business community. The valley has lots of angel investors, banks and law firms that cater to tech startups — and probably most important, lots of smart people eager to learn on the job and then come up with their own world-changing (or at least fortune-making) innovation.
Education is critical to a city's success, says Edward Glaeser, a Harvard economist and author of the 2011 book Triumph of the City. And where, a generation ago, college graduates were spread relatively uniformly around the United States, now educated people tend to be concentrated in places like San Jose, Seattle, Boston and Austin — places that also happen to be at the top of the charts for patents.
But people living far from an urban hotbed of innovation needn't despair – as long as they've got friends in innovative places. That's Clue No. 3, provided by Saxenian.
She has spent years studying innovation in Silicon Valley and says the fact that 40 to 50 percent of the patents there are awarded to immigrant inventors is no big surprise — about half of the valley's workforce is foreign born.
What has surprised her is how immigrants who have marinated in the culture and ways of the valley have maintained their ties back home — and used them to funnel business and money to innovators in places like Taiwan, China and India. Those stay-at-homes have spawned their own smaller hubs of innovation.
"What has seemed to work is these places that have connected through both personal and commercial relationships," Saxenian says. It might not be as good as rubbing shoulders with lots of other would-be innovators at the fast-food joints of the valley, but it's still better than being a lone genius.