SOURCE: Ewing Marion Kauffman Foundation

Ewing Marion Kauffman Foundation

November 18, 2010 05:00 ET

2010 Ranking of 'New Economy States' Highlights Leaders and Laggers in Innovation, According to Kauffman/ITIF Study

United States Must Address Fundamental Economic Competitiveness Challenges to Thrive in the New Economy

WASHINGTON, DC--(Marketwire - November 18, 2010) - Massachusetts, Washington, Maryland, New Jersey and Connecticut are the top five states at the forefront of the nation's movement toward a global, innovation-based new economy, according to "The 2010 State New Economy Index," released today by the Ewing Marion Kauffman Foundation and the Information Technology and Innovation Foundation (ITIF).

The bottom five states were unchanged from 2008. Mississippi and West Virginia have lagged most in making the transition to the New Economy. The other lowest-scoring states include, in reverse order, Arkansas, Alabama and Wyoming.

The report was released to coincide with Global Entrepreneurship Week, a worldwide initiative being held Nov. 15-21, 2010, to inspire young people to embrace imagination, innovation and creativity. The report makes clear that the nation -- and, by extension, the states -- cannot thrive without addressing fundamental economic competitiveness challenges.

"In this century, the global economy has shifted," said Robert Litan, vice president of Research & Policy at the Kauffman Foundation. "A mix of highly productive and innovative New Economy firms is necessary for an economy to prosper. The United States is lagging, and that lack of innovation-based vitality has contributed to our continuing recession. States need to concentrate on achieving New Economy success factors and providing the entrepreneurial resources and access that are critical to boosting competitiveness within the global marketplace."

The State New Economy Index uses 26 indicators to assess states' fundamental capacity to successfully navigate the shoals of economic change. It measures the extent to which state economies are knowledge-based, globalized, entrepreneurial, IT-driven and innovation-based -- in other words, to what degree state economies' structures and operations match the ideal structure of the New Economy. The 2010 Index builds on four earlier Indexes, published in 1999, 2002, 2007 and 2008.
Regionally, the New Economy has taken the strongest hold in the Northeast, mid-Atlantic, Mountain West and Pacific regions; 13 of the top 20 states are in these four regions. In contrast, 18 of the 20 lowest-ranking states are in the Midwest, Great Plains and the South.

"In today's highly competitive environment, states must work together and with the federal government to overhaul their economic development policies," said Dr. Robert D. Atkinson, president of the Information Technology and Innovation Foundation and co-author of the Index. "Too often, states still view their economic competitors as next door, rather than halfway around the world. If, instead, they used incentives to expand broadband, support entrepreneurial assistance programs, or invest in research and technology transfer, they -- and the nation as a whole -- would be far more globally competitive."

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About ITIF
The Information Technology and Innovation Foundation is a non-profit, nonpartisan public policy think tank committed to articulating and advancing a pro-productivity and pro-innovation public policy agenda internationally, in Washington and the States. Recognizing the vital role of technology in ensuring American prosperity, ITIF focuses on innovation, productivity and digital economy issues.

About the Kauffman Foundation
The Ewing Marion Kauffman Foundation is a private nonpartisan foundation that works to harness the power of entrepreneurship and innovation to grow economies and improve human welfare. Through its research and other initiatives, the Kauffman Foundation aims to open young people's eyes to the possibility of entrepreneurship, promote entrepreneurship education, raise awareness of entrepreneurship-friendly policies, and find alternative pathways for the commercialization of new knowledge and technologies. In addition, the Foundation focuses on initiatives in the Kansas City region to advance students' math and science skills, and improve the educational achievement of urban students, including the Ewing Marion Kauffman School, a college preparatory charter school for middle and high school students set to open in 2011. Founded by late entrepreneur and philanthropist Ewing Marion Kauffman, the Foundation is based in Kansas City, Mo. and has approximately $2 billion in assets. For more information, visit, and follow the Foundation on and

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