A few weeks ago, I attended a breakfast in Portland sponsored by the World Affairs Council of Maine. The topic: Immigration and Entrepreneurship. I thought this was a brilliant connection. The data are clear that people that are foreign-born file more patents, start more companies, and are more innovative. Yet few are making the connection - in communities that are losing population, and are increasingly old and white, immigration, whether from other states or other nations, is the only answer. Without immigration, these places will soon lack the workforce to fill existing jobs, or to attract or build new jobs. This is a sure recipe for economic stagnation.

Yet, there is another dynamic going on here. With immigration comes diversity, and with diversity comes innovation. New ideas occur when new knowledge collides with new perspectives and different ways of looking at things. Companies and communities that are diverse perform better because they are creative, open, and tolerant of each other and of risk and uncertainty.

Cathy

Immigration Myths

Fear, uncertainty and doubt about immigration and immigrants seem to be a fixture of American political and economic life. In each generation, immigrants are routinely discriminated against, decried and generally not welcomed. The fact that as immigrants move up the social ladder, they often discriminate against those who follow them is just one piece of irony. The New York Times recently ran an article about this phenomenon, arguing that the central problem is the authors call the Lump of Labor Fallacy - that there is only so much work to be done and that no one can get a job without taking one from someone else. But economics shows that this isn't at all true. In fact, immigrants also increase demand by renting apartments, getting haircuts, buying food, etc. So, the overall effect is to grow the economy.  Read the whole article here.

Is this Scary or Cool?

Draper Laboratory is developing a method to automatically detect and repair software errors in new programs. The method, DeepCode, uses big-data analytics to recognize patterns, mimicking the human brain's ability to learn.  Draper President and CEO Kaigham J. Gabriel said, "This novel approach attempts to do what neither static nor dynamic testing techniques have been able to accomplish to date - automatically find all known vulnerabilities in binary and source code."  More here.

Uncertainty and Innovation

Geert Hofstede created an uncertainty-avoidance measure years ago to identify and measure a culture's comfort with uncertainty. Cultures that measure high on uncertainty-avoidance try to minimize the occurrence of unknown situations by implementing rules, laws and regulations. Cultures that measure low tend to be more tolerant of change.  It turns out that high uncertainty-avoidance places have very high bureaucracy and low innovation, while the opposite is true in low uncertainty-avoidance cultures. A recent Harvard Business School article shows this effect in Greece, which scores 100 out of 100 on the index of uncertainty-avoidance. But wouldn't it be interesting to see how this applies to communities as well? More here.

Advanced Industries and Higher Wages

Brookings has recently redefined advanced industries to mean those that perform a high level of research and development per worker and employ a high percentage of workers in science, technology, engineering and math occupations. These industries, according to Brookings, provide the bulk of new inventions and products. It turns out that wages are rising very quickly in these industries, across the board, for all levels of education. The explanation offered by Brookings is that the orientation to new products is a distinguishing factor, versus sectors like health care, education and retail where cost containment are the driving strategies. This is a path to stagnation, according to Brookings. More here.

The Real Facts about Solar

The price of solar panels has come down by 80 percent since 2008. When coupled with new incentives and financing models such as solar leasing programs, you can understand why there is now around 20 gigawatts of solar energy in the US, and we added more capacity in the last two years than in the previous 30. Interestingly, this is not just for wealthy folks, but the median income of adopters is between $30,000 - $90,000. By the way, the solar industry is adding jobs 20 times faster than the national average, and increased 86 percent in the past five years. Facts here.

Let Customers Segment Themselves

Apparently, different customers are willing to pay different prices for your product. But the trick is how to figure out who is in what segment, and how to keep them fenced off from each other. The latest method: let customers segment themselves! You have probably experienced this yourself: when you buy an airplane ticket and the prices are lower if you stay over a Saturday or Sunday night. As a business traveler, you probably won't take this offer. But you might pay extra for legroom or to check a bag. The trick is being sure that your premium customers get something really extra! More here.