Rural America: The New Crucible of Innovation Brian Dabson, Rural Policy Research Institute

1. Rural America: The New Crucible of InnovationBrian Dabson, Rural Policy Research Institute The Federal Reserve Bank of St. Louis Conference on Innovation in Changing Times St. Louis, MO April 23, 2009

2. Crucible • Arthur Miller’s play about witchcraft, intolerance, hysteria and reputation…or • A container for the fusion of ores and metals to make steel…or • A severe test or trial http://thecrucible.org/ Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

3. Crucible of Innovation • Corporate and business school viewpoint • Combination of key factors within a high pressure market environment creates a crucible for innovation Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

4. A Rural Crucible? • Evolving context creates demand for change in public policy – both positive and negative • Factors include: • Population shifts – migration, natural decrease • Economic shifts – from farming, natural resources, manufacturing to services • Drives for efficiency leads to consolidation to overcome diseconomies of scale • Growing metro political focus devalues rural contribution • Weak public and institutional infrastructure Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

5. A Rural Crucible? • Extraordinary time for rural America to make new contributions to national prosperity • Four main areas • Growing and processing food – quantity, quality, and sustainability • Energy independence – extractive and renewable • Realizing economic value of nature’s services – stewardship • Protecting and managing rural experiences – natural, cultural Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

6. A Rural Crucible? • Three powerful strategies: • Regionalism – cooperation and collaboration across jurisdictions, sectors • Assets – building on unique strengths, triple bottom line • Entrepreneurship – conversion of assets into economic opportunity Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

7. A Rural Crucible? • Public policy aims for rural innovation: • Economic prosperity • Environmental sustainability • Social equity Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

8. Southern Minnesota Regional Competitiveness Project Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

9. Regional Flavor Strategies • Holistic approach to rural development with a focus on location, heritage, foods, culture, lodging, goods, services, natural assets… Holley and Woodroofe • Networks, innovation, collaboration Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

10. Entrepreneurship Development Systems Create a pipeline of entrepreneurs by identifying and supporting youth and adult entrepreneurs Implement a system of financial and technical support for entrepreneurs of all types Foster a policy and cultural environment supportive of entrepreneurship 12 county area straddling West Virginia, Kentucky and Ohio 5 rural regions in Oregon 4 counties in northern New Mexico Statewide in Nebraska Statewide in North Carolina Three Native American reservations in South Dakota and Wyoming Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

11. Transfer of Wealth Capture $53 trillion will transfer from generation to generation in next 50 years – could mean a major exodus of capital from rural America. Capturing 5% through community foundations will create sustainable capital base for rural community development. 20 states have had TOW analyses – rural Nebraska: $94 billion Rural America -- The New Crucible of Innovation Brian Dabson RUPRI

12. Rural Policy Research Institute Brian Dabson President & CEO brian@rupri.org www.rupri.org Rural America -- The New Crucible of Innovation Brian Dabson RUPRI