Federal Reserve Bank of Atlanta (SouthPoint blog):
Among recent developments, a study done by the Kaufmann Foundation ranked Atlanta second in the nation in entrepreneurial activity. As well, Georgia companies drew in more than $116 million in venture capital funding in the first quarter of 2014, compared with $46 million just two years earlier. On top of it all, Forbes magazine placed Georgia Tech’s Advanced Technology Development Center (ATDC) on its list of the top 12 Business Incubators Changing the World. So what’s the deal? Is Atlanta becoming the next Silicon Valley? Why has innovation been the buzzword of the last decade here?
A growing consensus holds that innovation is the key to economic growth in developed economies. Innovation enables firms to become more productive and thus increase output without increasing the amount of inputs (labor, capital, etc.). Throughout modern history, the kings of all innovations are the game changers, sometimes referred to as general-purpose technologies. Game changers include inventions including the steam engine, electrical power and, more recently, information and communication technology. Juan Moreno-Cruz, an assistant professor in the school of economics at Georgia Tech, noted that although you can’t always recognize a game changer right away; “there are small things that combine that make general-purpose technologies important.”