This publication updates the January 2004 study, New Returns on Investment in the Knowledge Economy: Proposition 301 at Arizona State University, FY 2003. Both works were launched by the report, Seeds of Prosperity: Public Investment in Science and Technology Research (2003), by Morrison Institute for Public Policy. Morrison Institute will periodically publish new material to keep you informed of the status of Proposition 301 investments at Arizona State University.

Almost every state hopes to capitalize on the tremendous wealth and job creation that can be generated by high tech science research-and billions of public dollars are being spent. But everyone is just speculating about the lasting value of these investments. While traditional assessments of return on public investment in science and technology tend to track short-term impacts, such as salaries, patents, and licensing revenues, the main foundations for long-term development of a knowledge economy appear to rely on a number of less tangible accomplishments. For example: Connections - the networks that develop between researchers, entrepreneurs, and venture capitalists; Attention - the publicity generated by the research and its networks that attract businesses and talent to locate in a region; and Talent - the highly skilled workers that such research attracts and trains.

These three indicators of economic success-henceforth called the CAT measures-have yet to be quantified and applied in a useful manner. That is the purpose of this study. It will be conducted in three parts, each with a culminating report. The first part will analyze the FY03 science and technology research activities and results for ASU's Proposition 301 initiatives. The second will develop a methodology for quantifying and utilizing the Institute's CAT measures. The third will field test the CAT methodology on a selected aspect of ASU's Proposition 301-funded research, and analyze results to provide Arizona decision-makers with recommendations to guide future policy.

Arizona Ideas includes notions large and small, homegrown and borrowed, current and historical. From A-Z, every one -- whether originally born here or adapted from elsewhere-- contributes to the state’s competitive position. Arizona Ideas also explores the roots of Arizona’s tradition of self-criticism --some call it a sense of insecurity or inferiority in comparison to other places -- that often surfaces in discussions of public policy. This observation has provoked considerable debate, but few would deny that this perspective exists. It is time to debate this idiosyncrasy out in the open and find better ways of moving the state ahead.

States have always administered federal programs. But, states usually have had very little say in how they carried out programs. All states could generally do was follow the rules laid out by federal agencies. But now, devolution is giving states more power over programs. And, in general, Americans have said that they approve of the idea. A 1998 nationwide poll, funded by The W. K. Kellogg Foundation, showed that a majority of Americans perceive devolution to be a positive development for the country.

Arizonans have gained a reputation for their low opinion of government, despite -- or perhaps because of -- the major role played by all governmental levels in residents’ daily lives. This view was reflected in the responses to this segment of the survey, as panelists generally gave low ratings to the government services they were asked to judge. This was especially true of lower-income panelists. But the respondents’ low ratings might not always have been based upon personal experience: Few panelists said they had sought information from government or community agencies. This may be due to the increasing popularity of the Internet as a self-help source, but it could also mean that relatively few residents need the services or know they are available. In any case, more than half of those who did seek information said they were satisfied with the result. Panelists were not dismissive of all collective efforts at social betterment. They expressed high levels of agreement that good community-based programs can prevent many social problems, from drug and alcohol addiction to child abuse and juvenile delinquency. Asked how they themselves would distribute public funds for social problems, most respondents choose programs for children, affordable housing, and health insurance.