Economic Competitiveness

Do states have the right policies in place to be competitive in a global, 21st Century economy? This is a key question, because much of the policy innovation and hard work needed to cope with the challenges of globalization—building infrastructure, improving educational performance, strengthening cooperation between public and private institutions—is often best undertaken at the state level. It’s also the case that when the path toward necessary progress is blocked at the federal level, the states often step in. 

For example, the federal government’s share of research funding nationwide has declined from almost 70 percent in the 1960s to less than 30 percent today. Industry has picked up most of the slack, but increasingly states are taking the lead. In the case of stem-cell research—an area likely to create some of the most breathtaking scientific breakthroughs in the 21st Century—states and private donors now spend significantly more money than the federal government.

But it’s still a brave new world for most governors and state economic development practitioners, and the Pew Center on the States (PCS) is considering how it can best help states develop an economic competitiveness agenda. Activities so far have resulted in a number of research reports and one project.

Research Reports

• In July 2007, PCS and the National Governors Association joined forces to produce, Investing in Innovation, a governors’ guide on states’ research and development funds, aimed at stirring innovation and creating new jobs.
• In December 2007, PCS released Promises with a Price, a first-of-its-kind report that examined $2.73 trillion in promised state retirement benefits. 
• In January 2008, PCS and Governing magazine published "Growth and Taxes," a report on how states’ tax structures impede economic vitality. 

Project: The Partnership for America’s Economic Success

Research shows that investing in programs that support children during their earliest years, from prenatal to age five, yields high returns for the U.S. economy. However, early childhood development is not at the top of the national agenda.  The Partnership seeks to change that.

In 2006, Pew convened philanthropists, foundations and corporations to create the Partnership for America’s Economic Success. Guided by an advisory board that includes economists, business leaders, children’s advocates and policy experts, the Partnership assesses the economic impact of strategic investments in young children.  Past and current funders include Buffett Early Childhood Fund, Robert Dugger, George Gund Foundation, Horace Hagedorn Foundation, Paul Tudor Jones, Ohio Children's Foundation, Peppercorn Foundation, The Pew Charitable Trusts, PNC Financial Services Group, Scholastic, Inc., Schott Foundation for Public Education and Anonymous.

The Partnership examines the ways in which early investments in children help to build our nation’s economy. It identifies and quantifies major child development strategies with proven positive rates of return; finds new approaches to financing investments in children, drawing from public, nonprofit and for-profit partnerships in other areas as examples of success; and develops effective communications strategies to bring this research to the attention of policy-makers and the public.

For more information, visit the Partnership for America’s Economic Success Web site.