Massachusetts, Maryland and Colorado, respectively, are poised to reap the strongest economic gains as a result of their high-tech assets, according to the 2008 Milken Institute State Technology and Science Index.
The study, first introduced in 2002, uses an index based on 77 indicators to determine which states have the potential to benefit most from their technology and science – or “knowledge-based” – assets. The indicators fall into five main categories: human capital investment; research and development inputs; risk capital and entrepreneurial infrastructure; technology and science work force; and technology concentration and dynamism.
The Milken Institute refers to the number-one ranked Massachusetts as “the gold standard for other states to consider when evaluating their own technology and science capabilities.” The state is strongest in the “research and development inputs” category, where it earned the highest mark of any state in any category. “Massachusetts is a hotbed of research;” says the report, “world-renowned research universities and cutting-edge firms fuel its economy.”
Maryland is “closing in fast” in the second-place position, with a first-place showing in the “human capital investment” category – and consistently among the top ten across all other categories. And Colorado, the overall third-place winner, has a consistent showing in the top five rankings across all five main categories.
California and Washington fill the remaining two of the top five spots on composite ranking list.
This study speaks to the increasingly important role that intangibles play in today’s economy. Its other general findings include the following:
- This year’s Index shows a concentration of scores near the mean – with a lower variance between the best- and worst-performing states. This trend, according to the Milken Institute, reflects increased competition for funding and capital.
- Because of the slowdown in the manufacturing and dot.com industries, some states appear to have reassessed which industries have the potential to create sustainable economic growth in a global marketplace.
- The Institute expects to see increased competition between states as technology makes jobs more portable.
- Also, any state’s position in the intangible economy could face increasing threats from competition by other countries, particularly China, India, Singapore, and other developing Asian countries
- Although neither made the top-ten list, North Dakota and Hawaii were both noted for their dramatic increase in positioning. North Dakota moved up 14 points from the 2004 Index, to the 31st position in this year’s rankings. The Milken Institute attributes North Dakota’s “strong momentum” to the state’s commitment (including financial contributions) to developing Centers of Excellence that foster regional development in science and technology.
Top Ten States for Technology and Science
The 2008 Milken Institute State Technology and Science Index names the following states as the top ten to enjoy the greatest economic benefits from their knowledge-based assets:
- Massachusetts
- Maryland
- Colorado
- California
- Washington
- Virginia
- Connecticut
- Utah
- New Hampshire
- Rhode Island