Economic Development Through Entrepreneurship

Economic Development Through Entrepreneurship

Government, University and Business Linkages

New Horizons in Entrepreneurship series

Edited by Scott Shane

Despite a wealth of efforts that examine separately the role entrepreneurs and universities play in economic development, no systematic effort has been made to examine the role universities play in promoting economic development through entrepreneurship. This book fills that gap, focusing on policy aspects of government–university partnerships with a discussion both of best practices and problematic strategies. The book begins by tracing the history of American government–university–industry partnerships that have promoted economic development. In succeeding chapters, well-known scholars focus on linkages in different domains such as: technology transfer, innovation networks, brain drain, cluster-based planning, and manufacturing. Practitioner commentaries follow many of the chapters in order to present an evaluation of the arguments from the perspective of someone directly involved in the fostering of these relationships.

Chapter 5: Buying Ohioans Loyalty? How State Financial Aid Affects Brain Drain

Eric Bettinger, Erin Riley and Robert Sheehan

Subjects: business and management, entrepreneurship, economics and finance, industrial organisation


5. Buying Ohioans’ loyalty? How state financial aid affects brain drain Eric Bettinger and Erin Riley INTRODUCTION Brain drain is a perennial issue concerning cities and markets of all sizes both here in the United States and abroad. Brain drain, or the loss of skilled human capital, often deprives cities of many of its most talented students – students in whom a state may have invested tens of thousands of dollars. Ambitious and educated young students often form ‘a striving class of young Americans for whom race, ethnicity and geographic origin tend to be less meaningful than professional achievement, business connections and income’ (Harden, 2003). And since job and schooling opportunities often draw these students and their incomes (and tax revenues) away from their home states, states have become increasingly attuned to competitive strategies that might stem this loss. In Ohio, concern over brain drain has filtered down from policy makers to the general public, as the popular press often cites the brain drain struggle. For example, the Cleveland Plain Dealer labels brain drain from Cleveland a ‘Quiet Crisis’ (Livingston, 2003). In addition a recent Census Bureau report found that the Cleveland region was one of three of the USA’s 20 largest metropolitan areas to lose young, single college graduates to other cities in the late 1990s (Census Report, 2003). Policy makers, like the popular press, often concentrate on job development. However there are other policy options that may also affect brain drain. For example, policy makers have long recognized that...

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