Innovation Index: Why It's Useful
The Innovation Index provides leaders and practitioners with the first tool for comparing a region's innovation performance with that of the United States, a state, or other regions. Users can design their own region and easily make comparisons across regions.
Innovation is a multifaceted concept, so this tool allows the exploration of the different dimensions of innovation. The Innovation Index comprises two broad categories: inputs to innovation, which measure innovation capacity, and outputs of innovation, which measure the results.
Within each broad category, the index provides additional detail and individual measures that collectively comprise the category.
The Innovation Index is designed to highlight factors that indicate a region is more or less ready to participate in the knowledge economy. The index is not by itself intended to directly guide decisions about investments in the region. More information about such decisions is found in the Guidelines for Regional Investment.
The index lets the practitioner explore innovation by guiding questions and conversations about the region’s performance. Economic dynamics play an important “input” role in innovation. The term “economic dynamics” captures a variety of indicators: venture capital, broadband penetration and business formation. The index enables one to explore each of these variables in depth and download detailed data by simply clicking the drill-down feature.
Human capital is also a vital input to innovation. Therefore, the index provides different perspectives to evaluate a region’s human capital.
This tool also includes state-level indicators—total R&D spending and science and technology graduates—that can help evaluate the strength of a state’s investments to support innovation.
Innovation is not only about inputs, however. A region’s economy must translate these inputs into productive outcomes: employment in high-technology firms, greater output per worker, the creation of patents, to name a few. By examining the output indicators, one can explore how well your economy converts innovation inputs into performance.