Defining Innovation Districts

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Blog Post
Title Defining Innovation Districts
Author Anne Dayton
Series Entrepreneurial Ecosystems
Content status Outline
Publication date
Notes
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© edegan.com, 2016

Outline / Major topics

  1. High-tech, high growth entrepreneurship should be central to an innovation district, but there's no evidence for high concentrations. Essentially these are redevelopment plans for medical centers. In most cases, there's no example of high-tech, high-growth in the innovation district.
  2. Most successful examples -- which Katz & Wagner do not study in depth -- do not involve medical centers (Kendall Square, South Lake Union). These also don't see to have involved extensive use of public funds or centralized urban planning (need more research to be sure). South Lake Union does include Amazon HQ.
  3. Innovation Districts Katz & Wagner study extensively seem to be determined by donor support. (All reports include disclaimer that donors do not influence report.)
  4. Katz & Wagner claim Innovation Districts can reduce social inequality. Do not present any evidence to support this claim. Evidence in "audits" of Oklahoma City and Philadelphia that stakeholders either allowed or deliberately constructed geographic barriers between lower income areas and medical centers. Katz & Wagner set a low bar for inclusion, claiming that 50% of "STEM careers" in innovation districts do not require bachelor's degrees, suggesting they are counting low-level medical assistants as STEM careers.

Data Needs

  1. Is Katz and Wagner's designations of these areas as innovation districts valid? Is something special happening in these geographic areas?
    1. To test, compare areas designated as "innovation districts" with similar areas around medical centers or Fortune 500 companies.
    2. Also compare to Kendall Square and South Lake Union. (South Lake union includes Amazon's HQ so it would already be in the data.)
  2. What kind of data?
    1. Demographic data for surrounding area
      1. Household income, home ownership, home value
      2. Ethnic and racial make up
      3. Highest level of education completed
      4. How do these compare to nearby areas?
    2. Evidence of Innovation and/or high-tech, high-growth entrepreneurship
      1. VC investment
      2. Patent filings, clinical trials
      3. Presence of any element of startup ecosystem such as incubator, accelerator, or hub
  3. How to get this data?
    1. Census data is organized by census tract. HUD has a tool to convert between census tract and zip code.
    2. Census tracts seem to be smaller than zip codes particularly in urban areas, so this might be a more precise unit of data
      1. Problem it may be difficult (or impossible) to determine census tract for VC, Fortune 500, and Medical Centers.

Notes

Research of Bruce Katz and Julie Wagner, Brookings Institute

The study casts a broad net. Any U.S. urban neighborhood in proximity to major medical centers could qualify regard less of geography, infrastructure, or presence of any high-tech, high-growth firm. Examples studied by group led by Katz include:

  • Philadelphia
  • Oklahoma City
  • Fort Worth
  • Houston (not extensively)

Includes some genuine success stories - private-sector development where local government got out of the way - but do not focus on these examples:

  • Kendall Square
  • South Lake Union.

Includes urban redevelopment projects. For example:

  • Detroit
  • South Boston Seaport
    • Original plan included high-tech, high-growth entrepreneurs
    • Subsequent development seems to have priced startup firms out
    • Some of the original members of entrepreneurial ecosystem relocated

Includes research parks, so definition can include Research Triangle Park which a new design plan proposes to “urbanize”

City profiles cheer a variety urban renewal development that can fit within this broad definition. For example:

  • Chattanooga
  • Fort Worth

Brookings receives donor support from institutions involved in innovation district projects it accesses, For example:

  • Philadelphia & OKC reports
  • Also New York Times article supporting documents included discussions of connecting KKR (real estate developers) to contacts in Detroit and Philadelphia
  • Philadelphia & OKC report include disclaimers about donors influencing outcomes.

Other points:

  • Makes claim that innovation districts can mitigate income inequality.
  • When describing “Innovation districts” near medical centers, claims that 50% of STEM careers in these locales do not require bachelor’s degrees, suggesting that they are counting medical techs, nurse’s aids, etc. as “STEM careers”
  • Many of jobs most accessible to less well-educated workers would be in the service sector. No evidence that these would be well-paying.
  • Close examinations of Philadelphia and Oklahoma City suggest that residents from nearby impoverished zip codes are not taking jobs in the “innovation district.”

Specific claims:

  • "Innovation Districts can grow better and more accessible jobs at a time of rising poverty and social inequality" (p.4)
  • "platform for regenerating adjoining neighborhoods" (p.19)
  • "Practitioners noted the need to be purposeful in hiring, training, and supporting local talent, with the ultimate goal of giving low-income workers economically-mobile career paths with family-sustaining wages." (p. 19)

Zip codes to compare for "Innovation Districts"

  • Detroit (Quicken Loans 48226, Henry Ford Health Sys (48202), Wayne State (48202), "downtown and midtown", Kresge Foundation (donor), Invest Detroit (Community Development Financial Institution), American Lightweight Materials Manufacturing Innovation Institute 48216)
  • Philadelphia (Comcast Innovation and Technology Center 19103, UPenn 19104, Drexel 19104, Univ. City Sci Center 19104)
  • St. Louis (Cortex 63108, Wash U 63130, St. Louis U 63103, Barnes Jewish Hospital 63110, CorTex West Development Corporation, )BioGenerator 63108
    • "St. Louis will clustering five innovation centers, with the purpose of generating 'collision points" between smart people."
    • Danforth founded BioSTL Coalition (p. 15)
  • Seattle South Lake Union (Amazon 98109) See Vulcan Real Estate (Paul G. Allen) ; Univ. of Washington medical research campus 98109
  • Cambridge, MA (Kendall Square 02139, MIT 02139, Cambridge Innovation Center 02142)
  • Boston (South Waterfront) Babson College 02210 & Fraunhofer Center for Sustainable Energy Systems 02210, Mass Challenge 02210, District Hall 02210, GreenTown Labs (moved to Somerville in 2013, 02143), Battery Ventures 02210
  • Texas Medical Center
    • TMC one of several "leading edge innovation districts" (p. 14)
  • Chattanooga (Electric Power Board of Chattanooga, Lyndhurst and Benwood Foundations (funders), Univ. of Tenn at Chattanooga 37403, The Enterprise Center 37402, Edney Innovation Center 37402, GigTank (program of the Company Lab 37402)
  • Fort Worth (Sundance Square 76102, near medical center Cook Children's 76104, JPS 76104, Harris Methodist 76132, Baylor Scott 76104, HCA's Plaza 786104, Moncrief 76104)
  • Oklahoma City

Other zips:

  • 73104 - OKC VA Medical Center, Oklahoma Medical Research Foundation, OU Med Center, Dean McGee Eye Institute, Oklahoma School of Science and Mathematics (high school), Harold Hamm Diabetes Center, GE Global Research (oil & gas), i2E "innovation to enterprise", Oklahoma Health Center Foundation, Presbyterian Health Foundation
  • 73117 - College of Allied Health, College of Pharmacy, Young Biomed Research Ctr

Useful Data sources

Census data is by census tract. This tool from HUD might be useful: https://www.huduser.gov/portal/datasets/usps_crosswalk.html

https://www.census.gov/econ/geo-zip.html 

Economic Census	2012	Sales, employment, payroll for establishments by detailed industry
ZIP Code Business Patterns	2014	Establishments by employment size by detailed industry

Other census data: https://www.census.gov/data/data-tools.html

Generally:

  • Demographic (household etc.)
  • Business survey

Our data:

  • NIH
  • NSF
  • Clinical Trial
  • Patents

We need:

  • zip code for the districts (we have them)
  • Timing - When we they active as innovation districts? When was the policy shock?
  • Only focus on US

Ideas:

  • Make-up of districts right now vs. controls. Possible controls:
    • Medical Centers
    • the districts they don't focus on (Kendal Sq, Research triangle)
    • list of research parks (membership of org?)
    • HQs of Fortune 500s
    • Places that have undergone urban renewal - hipsters from the census?
    • US Economic Development Agency - Grants for urban renewal
  • The districts over time
    • Patents, grants, etc.
    • VC backed started and VCs themselves!

Test their claims:

  • Actually innovation districts!
  • Income inequality
  • Diversity/other demographics
  • Employment in STEM
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