Wisconsin Entrepreneurs

Wisconsin Entrepreneurs:

Roughly half the people in Wisconsin are thinking about starting a business or have started a business, according to a new study of the state’s entrepreneurial climate. The study, “A Medium for Growth: The State of Entrepreneurship in Wisconsin,” (Download the complete report - 5 meg PDF) reported the strikingly high figures after surveying 1,144 randomly selected households across the state last year.

Distance and the City

Via the Economist Blog, channeling Ed Glaeser and Gaicomo Ponzetto.

The past forty years have seen a remarkable range of urban successes and failures, especially among America’s older cities. Some places, like Cleveland and Detroit, seem caught in perpetual decline. Other areas, like San Francisco and New York, had remarkable success as they became centers of idea-based industries.

In this paper, we suggested that these urban successes and urban failures might reflect the same underlying technological change: a vast improvement in communication technology. As communication technology improved, it enabled manufacturing firms to leave cities, causing the urban distress of Detroit or Manhattan in 1975. However, declining communication costs also increased the returns to new innovations, and since cities specialize in idea-production, this helped invigorate some cities.

The model suggests that future improvements in information technology will continue to strengthen cities that are centers of innovation, but continue to hurt cities that remain oriented towards manufacturing. Certainly, there is every reason to think that the free flow of people and capital across space will only continue to increase the returns to new ideas.

The important question for the future of cities is whether urban areas will continue to have a comparative advantage in producing ideas. The great challenge to urban areas therefore comes from the possibility that innovation will also leave dense agglomerations. While this is possible, there is a remarkable continuing tendency of innovative people to locate near other innovative people. Silicon Valley, for example, is built at lower densities than New York, because it is built for drivers not pedestrians, but it is certainly a dense agglomeration. As long as improvements in information technology continue to increase the returns to having new ideas, then the edge that proximity gives to innovation seems likely to keep such agglomerations strong.

Rather ironic isn't it? Improved communication technologies leads some people to locate CLOSER to each other. They do - if I understand the argument - precisely because they are better rewarded for their ideas since improved communication technologies increases the size of the audience for those ideas. Yet those same ideas are easier to generate when physical proximity is close.

I don't believe this bodes well for our region. As a professor of mine used to say: La Crosse is centrally isolated. It will be hard for knowledge workers in our region to avoid the pull of the magnets of Chicago and the Twin Cities.

Start Ups

The Governor of Wisconsin is encouraging Entrepreneurs. Here are the details:

The mission of the Governor’s Business Plan Contest is to encourage entrepreneurs in the creation, start-up and early-growth stages of high-tech businesses in Wisconsin. Participants have the chance to win seed capital, valuable services that will help them launch their businesses and a Grand Prize worth $50,000. Since its inception in 2004, more than 1,000 entries have been received and nearly $650,000 in cash and in-kind prizes has been awarded. In 2007, 12 finalists won cash prizes.

Produced by the Wisconsin Technology Council and a growing list of partners, the Governor's Business Plan Contest engages contestants in a six-month process that includes mentoring and comments from judges on selected plans. It will also lead to valuable public and media exposure for the best business plans submitted by contestants and spur economic growth in Wisconsin. In addition, past finalists have raised a reported $11 million in private equity, such as angel and venture capital.

The statewide contest is an opportunity to compete for cash and in-kind prizes, but it's also a chance to get constructive feedback on your business plan and to help move it from a virtual business to a reality. In 2008, contestants will once again have the opportunity to win upwards of $200,000 in cash and services!

More Foreclosures

Here is a post with an excellent graphic on the national distribution of foreclosures as a percentage of housing units.

Not least, the crisis is harming the neighbors of people in foreclosure, even those who aren’t having trouble making loan payments. According to one academic study, every foreclosure reduces the value of all other houses within an eighth of a mile by about 1 percent, as the sight of vacant property scares off potential buyers. Combine that with a market already in decline, and neighborhoods that begin to have troubles can go off the cliff.