Born on Third Base: Silicon Valley's Rich Inheritance

Stephen B. Adams

Michael Porter has argued that in the twenty-first century, economic prosperity would be “created” through innovation rather than inherited through factor endowments, such as natural resources. Silicon Valley inherited a different set of endowments, resources accruing by virtue of its location. It mattered that Silicon Valley came to be in the country with the world’s largest economy, in one of America’s wealthiest states, and near the largest financial center west of the Mississippi. It mattered that Silicon Valley came to be in the country that was developing the world’s most formidable system of national defense and associated technological capabilities. It mattered that Silicon Valley came to be in the country with the world’s foremost system of research universities. The initial development of this high-tech region was also reliant upon an abundance of supporting institutions rather than the inscription of one garage-based start-up after another upon a tabula rasa. During Silicon Valley’s first fifty years, innovation was made possible by inheritance.

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