Top global city governments for innovation
Today, 54% of the world’s population lives in urban areas, a proportion that is expected to increase to 66% by 2050 according to the United Nations. The development of creative industries is getting increasing attention from city governments and recent research has ranked global cities on the policies and actions in achieving a high degree of innovation and entrepreneurship.
New York City was identified as having the most effective policy environment to foster innovation, followed closely by London, Helsinki, Barcelona and Amsterdam. The other 35 cities can been seen on the image below. Dublin is not in the sample.
This year Dublin City Council received a Driving Citizen Co-Creativity Award in Finland. It appears that the council's "Innovation Festival" annual event was last held in 2012.
This is an Irish Times editorial today on shambolic transport policy in the Dublin area that is the responsibility of central government: "As a result of this dithering, Dublin developed and sprawled out into Leinster as a motorised city, reflecting extremely outdated 1960s thinking about transportation. Comparable European cities, with which Dublin competes for inward investment, were much wiser — putting the emphasis on improving public transport rather than throwing roads at the traffic problem."
The research on city governments published by CITIE (City Initiatives for Technology, Innovation and Entrepreneurship) last June, is a collaboration between Nesta, the UK's innovation think-tank, Accenture, the consultancy, and the Future Cities Catapult, an urban innovation group. It assessed how effectively 40 city governments around the world are in helping the development of innovation and entrepreneurship and "it provides actionable insight to help policy makers catalyse growth."
A city innovation index is not new and in 2014 Dublin was ranked at 108 of 162 cities in this index. San Francisco–San Jose, New York and London were on top.
The Brookings Institution has reported on the rise of what it calls "innovation districts" in America's new geography: "we found the rise of urban innovation hubs to be the organic result of profound economic and demographic forces that are altering how we live and work. The growing application of 'open innovation' — where companies work with other firms, inventors, and researchers to generate new ideas and bring them to market—has revalued proximity, density, and other attributes of cities. At the same time, the growing preference of young talented workers to congregate in vibrant neighborhoods that offer choices in housing, transportation, and amenities has made urban and urbanizing areas increasingly attractive."
In 2011 Finfacts reported on the enduring impact of the building of baroque opera houses in German cities in the 17th and 18th centuries that resulted from a battle of prestige among princes. Local income levels in all of the 29 cities in Germany with such an opera house are higher than income levels in comparable cities without an opera. Taking their analysis further, researchers excluded Free Imperial cities, Hanseatic and cities with a long-standing university tradition and restricted their analysis to western Germany in order to isolate the opera-house-effect from other possible confounding effects on prosperity. The results, however, remained unchanged: expenditure on culture has positive income effects on all of the employees in a region.
“The mechanism works like this: cultural amenities attract more highly-qualified workers, and their higher income spills over to the entire regional economy,” said Oliver Falck, director of the Ifo Center for Industrial Organisation and New Technologies. “The study’s findings represent a key argument in favour of subsidising cultural facilities. In cities like Berlin, this could hopefully lead to job creation in the long-term,” he added.
CITIE tested against a series of metrics that collectively answer three questions:
1. How open is the city to new ideas and new businesses?
2. How does the city optimise its infrastructure for high-growth businesses?
3. How does the city build innovation into its own activities?
The analysis revolves around nine policy roles that city governments can adopt to support innovation and entrepreneurship. The roles are Regulator, Advocate, Customer, Host, Investor, Connector, Strategist, Digital Governor and Datavore. They are designed to cover the full range of a city’s operations.
CITIE said New York’s key differentiator was its long standing leadership over the last decade, which has supported the growth of a sector that now accounts for nearly 300,000 jobs. London also performs strongly in second place, but lacks internal capabilities such as a Chief Technology Officer or innovation team that have proved successful elsewhere.
Helsinki, Barcelona and Amsterdam’s places in the top five show that smaller cities with less publicised tech scenes are also starting to create the right conditions for growth. Some of the most innovative ideas can be found in these cities, such as Helsinki’s mobility on demand strategy, Barcelona’s open procurement, and Amsterdam’s living lab for entrepreneurs to test live ideas.
While the CITIE analysis shows a rich diversity of approaches across different cities, there are three characteristics that high-performing authorities have in common:
1) They find creative ways to effect change outside of their formal policy responsibilities; taking startups on mayoral visits, hosting meetups and connecting different parts of the community together. 2) They are open by default, recognising that the expertise necessary to solve problems in the 21st Century may not reside solely within city hall, and working with outside organisations wherever possible. 3) They act more like entrepreneurs than bureaucrats. Employees are given license to try things out, think big, and to work at the pace of change in the world around them.
John Gibson, director of Government Innovation at Nesta, said, “City governments can’t build tech communities. That’s not how entrepreneurship works. But there’s a number of clear things that cities can do to create the most fertile environment for new businesses and new ideas. The objective of CITIE is to help them do this well. By focusing our analysis on the specific things that policymakers can do, we hope to provide the kind of actionable insights that can inform policy, drive growth and make cities better places to live.
Part 1: Keynote speech by Nesta’s John Gibson:
Part 2: Panel discussion: How city governments can support tech companies:
Chair: Rohan Silva, cofounder Second Home
John Gibson, director of Government Innovation at Nesta
Neil Rimer, partner at Index Ventures
Andrew Collinge, assistant director at the Greater London Assembly
Pic on top: Sunset over Brooklyn, New York City Photo Credit: NYOnAir.