Barbara Bao Urban Economics

 Alternative names: science or technology parks  Organizational entities that sell or lease spatially contiguous land and/or buildings to businesses or other organizations whose principal activities are research or development of new products or processes. Excludes high-tech centers or corridors such as Route 128 (MA) and Silicon Valley (CA) – concentrated businesses outside of formal organizations Excludes industrial parks where manufacturing is the primary focus  Notable research parks: University of Utah Research Park, Stanford Research Park

 Largest and most successful research park in the world  Occupies 7,000 acres  R&D branch plants of major, technology- oriented corporations 130 R&D facilities More than 39,000 employees Largest IBM operation in the world – 11,000 employees  Represents one of the most dramatic cases of regional economic restructuring

 NC had the second lowest per capita income of any state in the 1950s  Concentrated in three low wage, declining industries: tobacco, textiles, and furniture  Combination of high-quality research universities and lack of job opportunities led to a huge brain drain

 1955 – Governor Luther H. Hodges formed a committee of state business leaders and university officials to find a way to restructure NC’s economy  Attract industrial research laboratories, in turn attract production facilities wanting to locate in the general proximity  Karl Robbins, a retired industrialist, proposed building a private research park Failed to attract investors

 a group of private citizens and civic-minded corporations bought out the stock of the research park – forming the Research Triangle Foundation  First occupant – Research Triangle Institute, a nonprofit contract research organization  Slow to attract other organizations until 1965 – IBM, NIEHS (Environmental Health Sciences)

 Howard W. Odum, sociologist at UNC first to hypothesize that scientific research activity can stimulate the economic development of a region  Four factors Park’s vintage Geographic location Size of the metropolitan area Presence and type of universities

 47% of R&D organizations would probably not have located in the Raleigh- Durham area if RTP didn’t exist Loss of 52,000 jobs  Responsible for a significant portion of relative growth the region’s per capital personal income 93% to 107% from 1960 to 1987 compared to the US average

 Nonprofessional workforce comes from local sources – only 16.7% from outside However 48.3% of the professional workforce come from outside the region representing an underdevelopment of networks between the park and other businesses in the area  Substantial changes in the political environment Improved public infrastructure Changed socioeconomic composition  Highest concentration of PhDs and MDs, but also of residents who haven’t graduated from high school

 Universities contribute to the creation of “localization economies” for park businesses Presence of specialized resources Supply of graduates Faculty expertise for consulting Prestige of association  Success: positive difference in employment growth rates Counties with medical and engineering institutions grew faster

 1. Presence of university stimulates regional demand for goods and services  2. Human capital investment (passing on knowledge and training to students) enhances labor and general business productivity  3. Technology transfer results in increased productivity  4. Direct investment and technical assistance to startups  5. Directly attracting businesses seeking trained labor and expertise

 1. Help attract and retain entrepreneurial faculty  2. Help attract good graduate students  3. Increase collaborative research with private industry  4. Facilitate technology transfer and commercialization of faculty inventions  5. Enhance reputation and prestige of the university  6. Contribute to the economic development of the region  7. Generate revenue through land sales and leases

 Growth has slowed Falloff in rate of new corporate R&D facilities nationally Increased competition from other regions RTF’s delay in infrastructure investment  Expansion has slowed Targeted large corporations  Top 12 largest companies employ 30,000 people Economically infeasible for startups  Reason why it hasn’t been as successful as Silicon Valley Zoning issues, stringent building and site restrictions