Seven years ago, the Economics Department of BankBoston conducted the first study of its kind--an analysis of the financial and economic characteristics of the businesses established in a state by the alumni of a university. The state in this case was Massachusetts, the university was MIT. The study was an effort to more fully assess the significance of a great technological university to the economy of the Boston metropolitan area and the state of Massachusetts.
One of our key findings was a pattern that emerged on the relationship of innovation and business formation to economic growth and renewal. Our analysis showed how the creation and "growing up" of companies started by MIT founders has played a positive role in promoting rapid structural change in the Massachusetts economy.
The current study--building on the work of our earlier analysis--s even more ambitious: it measures the national job creation of a single research university and provides new insight into why MIT alumni select their business sites and where they choose to expand nationally.
In a national economy that is increasingly emphasizing innovation, these findings extend our understanding of how MIT has been instrumental in generating new businesses nationwide. MIT is not the only university that has had a national impact of this kind, but because of its historical and continuing importance, it illustrates the contribution of research universities to the evolving national economy.
Our MIT studies are part of BankBoston's ongoing efforts to monitor the condition of the New England, U.S. and global economies. In recent years, the globalization and increasing complexity of the world economy and the onset of new competitive pressures have made this task more challenging than ever before. These reports help to understand how economic and technological change will affect the fortunes of our region and nation.
Our latest report was a collaborative effort between Ed Moscovitch of Cape Ann Economics, and BankBostonŐs Economics Department team: Richard DeKaser, Senior Economist, Paula Fitzgibbon, Senior Statistician, and Diane Fulman, Director of Global Programs, who directed the first MIT study.
We hope you will find this report useful. We welcome your comments and suggestions on the report and the ongoing work of the Economics Department at BankBoston.
Wayne M. Ayers
Chief Economist
BankBoston
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