SSTI Digest

A working paper published in the National Bureau of Economic Research asked the question, “Do large firms produce more valuable inventions, and if so, why?” An excerpt of an analysis of the paper that appeared in the November 2022 issue of the NBER Digest follows with additional consideration from SSTI Vice President Mark Skinner on its implications for technology-based economic development. Larger firms tend to profit more from their inventions than do their smaller counterparts. In Invention Value, Inventive Capability, and the Large Firm Advantage (NBER Working Paper 30354), Ashish Arora, Wesley M. Cohen, Honggi Lee, and Divya Sebastian find that this does not occur because large firms produce inventions of higher technical quality. Rather, it is because they extract more value from their inventions, likely through more effective commercialization, which includes product development, marketing, distribution channels, and manufacturing. The researchers estimate that doubling a firm's size is associated with an increase of between 5 and 16 percent in the value of a given invention, depending on whether one controls for the firm's capitalization. Invention…

Over the past four fiscal years, there have been 1,977 initial public offerings (IPOs) completed by companies headquartered in the U.S., according to PitchBook, yielding more than $549 billion in capital invested. These companies are located in 45 states, D.C., and Puerto Rico. Almost 20% of those companies are no longer publicly held, having been returned to private ownership, been acquired, merged or gone out of business. Across the four years, data shows a spike of IPO size and count in 2021, with a total IPO count of 956 and total IPO size of $315.7 billion for the year.  The Pitchbook data used in this analysis shows full transactions on completed IPOs for companies headquartered in the U.S. between October 1, 2018 and September 30, 2022.  The map below shows the total number of companies that held their initial public offering in each state over the past 16 quarters (Q4 2018 to Q3 2022)).  California, Florida, Massachusetts, New York and Texas were the states with the greatest number of successful IPOs in fiscal year 2021, with at least 50 IPOs completed per state. The data shows a sharp increase in 2021 IPO count for New…

NIH just launched the funding opportunity announcement for the third cohort of its regional biomedical proof-of-concept and accelerator program, the Research Evaluation and Commercialization Hubs. On Dec. 12, NIH will be hosting a funding opportunity announcement pre-application webinar which will provide a question and answer opportunity with NIH SEED and NIGMS. In collaboration with SSTI, RTI International’s Alan O’Connor will be providing an overview of the REACH program in a separate webinar on Dec. 8, covering best practices and lessons learned, and summary impacts to date from the first two cohorts of eight sites. This is an excellent opportunity for state science and technology policy teams to hear from the program’s evaluator about return on investment, strategies that have worked well, and other aspects of the REACH program. The REACH 2015 and 2019 cohorts include eight sites with 51 universities and technical colleges from 12 states. The REACH program provides initial product development funding, coaching, and skills development to support academic innovators in the translation of their scientific discoveries into products and services that improve…

Two recent working papers — The Impact of High-Skilled Immigration on Regional Entrepreneurship from Columbia University and Getting Schooled: The Role of Universities in Attracting Immigrant Entrepreneurs from the Philadelphia Federal Reserve Bank — explore the impact of high-skilled immigrants on entrepreneurship and how universities attract immigrant entrepreneurs. Both papers find that high-skilled immigrants have a positive net effect on regional entrepreneurship and are critical to the entrepreneurial ecosystem. In the first working paper, The Impact of High-Skilled Immigration on Regional Entrepreneurship, the authors Jorge Guzman, Inara Tareque, and Dan Wang studied the impact of high-skilled immigration at the metropolitan city level using the Core-based Statistical Areas (CBSA) and neighborhood (zip code) level data. The authors used newly released H-1B data from the U.S. Department of Labor and the U.S. Citizenship and Immigration Services. The H-1B visa program allows 85,000 new high-skilled foreign nationals to work in specialized roles in the U.S. for up to six years. However, under the H-1B visa program, immigrants are only allowed to work for the…

New York became the first state to enact a temporary ban on new cryptocurrency mining permits at fossil fuel plants in a move aimed at addressing the environmental concerns over the energy-intensive activity. The legislation, signed by Gov. Kathy Hochul, will impose a two-year moratorium on crypto-mining companies seeking new permits to retrofit some of the state’s oldest fossil fuel plants into digital mining operations. The measure also requires New York to study the industry’s impact on the state’s efforts to reduce its greenhouse gas emissions. The policy creates a pause on permits for fossil fuel power plants that house proof-of-work cryptocurrency mining, which is used in the transaction of digital money. Hochul states this moratorium is important in stopping the potential increase in emissions that could occur through revamping of old power plants with unused electrical infrastructure. The legislation builds on New York’s Climate Leadership and Community Protection Act and will trigger a study by the state Department of Environmental Conservation to study the impacts of the cryptocurrency mining industry on the environment. Despite concern…

The Federal Communications Commission (FCC) recently released the first draft of a new national broadband map providing a more granular look at broadband service throughout the country. The new broadband map was created to ensure that the $42.45 billion federal investment from the Bipartisan Infrastructure Law’s Broadband Equity, Access, and Deployment (BEAD) Program makes its way to the areas most in need of broadband service when it is allocated to states on June 30. This program provides each state with at least $100 million and additional funds according to the number of unserved or underserved areas. This new broadband service map is a response to a demand from Congress in 2020 for a more detailed map. Previous broadband maps determined service at a census block level. The new map determines broadband access by address using data from internet service providers and allows the public to check their address to confirm its accuracy. If people find the map incorrect, they can file a challenge. In October, New York state officials challenged FCC data, claiming that 31,000 locations were said to have access that are actually underserved or unserved. This claim is…

Enough races have now been called in the 2022 midterm elections to confirm that the Senate will remain under Democratic party control while the House will switch to the Republican party. If any legislation is going to advance to the White House over the next two years, the parties are going to need to work together — both across and within each chamber (where Senate filibuster rules and House politics are likely to make bipartisan votes a necessity to passing bills). Federal technology and innovation policy has a history of support from both parties. Further, there has been strong recognition across the government that America’s global economic competitiveness and national security are both intrinsically tied to the development of new technologies and the integration of these innovations across the economy. As evidence of this support in the current Congress: the CHIPS and Science Act passed the Senate (64 “yea” votes) and the House (243 “yea” votes) with bipartisan support, and funding for SSTI’s Innovation Advocacy Council priorities has champions on both sides of the aisle — a major factor in seeing consistent increases for Build to Scale, Regional Innovation…

A report from ITIF exploring the factors involved in ecosystem strength found that states in Germany generally perform better than states in the U.S., Italy, and Canada in terms of globalization, knowledge economy, and innovation capacity. The Index reported that the critical factors influencing an ecosystem are the quality of education (especially in STEM fields), public and private R&D investments, the range of highly trained R&D personnel, economic dynamism, and entrepreneurship. Based on these indicators, ITIF ranked Massachusetts, California, Baden-Württemberg, Berlin, and Washington as the leading regions for innovation competitiveness. While the U.S. outperforms its peers in higher education attainment (Knowledge Economy), Germany shows strength in technical and scientific employment. To prevent stagnation, ITIF recommends the U.S. promote industry-university partnerships supporting both R&D and STEM education efforts, as there is room for improvement in terms of increasing skilled immigration and levels of professional employment. The United States ranks lower than Italy and Germany in R&D personnel and lower than Germany in R…

Despite the success of Michigan’s numerous initiatives to provide tuition-free college, an analysis from New America exploring Michigan’s effort to increase the affordability and accessibility of higher education found that the fragmented approach reduces the state’s ability to reach all residents needing financial assistance. To make college more affordable and accessible to all Michiganders, the report recommends considering more straightforward free-tuition programs. One of Michigan’s first tuition-free initiatives was Michigan Reconnect, which provides free tuition at in-district community colleges for residents over 25. According to data from the Michigan Department of Labor and Economic Opportunity cited by New America, the Michigan Reconnect program provided nearly 19,700 residents with free community college. A second program, Futures for Frontlines, was created to help essential workers during the COVID-19 pandemic afford community college. This program helped 26,000 Michigan residents access community college. The most recent program, the Michigan Achievement Scholarship, provides up to $5,500 for a student each year at any public university or college in…

Thirty-six states held gubernatorial contests in Tuesday’s (Nov. 8) mid-term elections. By the end of the last week, winners in 32 states had been chosen. As of today, contests in Arizona, Nevada and Oregon have been called; while votes continued to be tallied in Alaska, which held its first ranked choice general election. Gov. Mike Dunleavy maintains a substantial lead and appears he will be re-elected. As such, Dunleavy will be the first governor to be elected to back-to-back terms in the state since former Democratic Gov. Tony Knowles won reelection in 1998. Results from gubernatorial elections and ballot measures that were not available at last week’s writing are detailed below. With the elections finalized in Arizona and Oregon, the new year will see 12 states headed by a female governor; Oregon’s Gov.-elect Tina Kotek will join Gov.-elect Maura Healey in Massachusetts as one of the first openly lesbian governors. Democrats were able to flip Arizona, Maryland and Massachusetts, while the GOP flipped Nevada. Republicans will maintain a slight advantage with 26 states having a GOP governor in January. (Before the mid-term election, Republicans held 28 states…

Amazon is allocating $50 million from its Climate Pledge Fund — Amazon’s venture capital program that invests in companies pioneering decarbonizing technologies and solutions — to invest in women-founded and women-led climate tech companies, as well as incubators and accelerators that prioritize women-led entities. The Amazon press release states that female-founded companies typically receive a fraction of global venture capital, and that percentage fell during the pandemic, yet research shows that female entrepreneurs are more likely than their male counterparts to innovate to address social needs. Women-led companies also generate more revenue per dollar invested and produce greater ROI for investors. It is unclear what portion of the $50 million allocation is likely to remain in the U.S. Paired with the announcement was another in which Amazon provided $3 million match to a similar-sized investment from the U.S. Agency for International Development (USAID) to seed the Climate Gender Equity Fund. The new fund is a public-private partnership intended to address the gender inequities that exist for women in the climate finance ecosystem and support female…

As opportunities in science, technology, engineering and math (STEM) develop around the country, different inclusion programs are being put in place to increase participation for women in the field. SSTI previously released an article highlighting the lack of female participation in certain STEM careers, like computer science and engineering, despite tech industries growing in different cities around the country. This week’s story focuses on different efforts that are in place to help turn that tide and increase women’s participation in STEM fields and the results the efforts are having. A frequently-raised issue related to women specifically in computer science is the lack of female representation and role models. NSF awarded a grant for Code: Sci Girls, a three-year project designed to engage 8 to 13-year-old girls in coding through transmedia programming to help inspire and prepare them for future computer science studies and career paths. The grant helped produce a show shown on PBS that has proven effective in piquing the interest of young girls in the STEM field. Episodes also stream on Amazon and the SciGirls YouTube channel. The episodes garnered 25 million…