Urenio Watch Watch: Innovative Cities & Regions

The World is Spiked

The world is spiked - Click to enlargeThe 2007 Index of Silicon Valley introduces the idea that “The World is Spiked’ meaning that although the global competitive field is “flattening’1 regions still vary by their relative strengths and weaknesses from which regional specializations and comparative advantage emerge’”creating “spikes’ in a flat world.

The challenge for a region is to recognize their own strengths, identify other regional “spikes’ based on their strengths, and then connects to those “spikes’ for mutual benefit. In addition to a region’ s own technological and business capacities, its comparative advantage will be determined by its openness toward other regions. Although the openness created through global linkages increases exposure to the turmoil of globalization, it also speeds and expands learning by firms and institutions.

The identification of “spikes’ (shown in the above map of global regions) is based on relative rankings in three critical areas: employment in information technology per capita, patents per capita and venture capital per capita. These “spikes’ represent important strengths in the knowledge based economy: talent, ideas and investment.

Silicon Valley' s Place in the Global Network of Regions

Silicon Valley’ s Place in the Global Network of Regions

The 2007 Index of Silicon Valley, publish by Joint Venture: Silicon Valley Network, notes that Silicon Valley has entered a new phase in its dynamic evolution. The economy is clearly growing and transforming, evidenced by the region adding more than 30,000 jobs over last year’ s total. Moreover, the employment gains are quite broadly based, spanning most sectors of the economy and not just our driving industry clusters. Per capita income, average pay, and value-added per worker have been on the rise now for three years running, but over the past year they showed substantial increases.

Index at a glance

Joint Venture’s Silicon Valley Index is a publication that has been telling the Silicon Valley story since 1995. Released every January, the indicators measure the strength of economy and the health of community’”highlighting challenges and providing an analytical foundation for leadership and decision making.

Indicators are measurements that tell us how we are doing: whether we are going up or down, going forward or backward, getting better or worse, or staying the same. Good indicators:

  • are bellwethers that reflect fundamentals of long-term regional health;
  • reflect the interests and concerns of the community;
  • are statistically measurable on a regular basis; and
  • measure outcomes, rather than inputs.

Several of the economic indicators relate to “industry clusters.’ An industry cluster is a geographic concentration of interdependent, internationally competitive firms in related industries, and includes a significant number of companies that sell their products and services outside the region. Healthy, outward-oriented industry clusters are a critical prerequisite for a strong economy.

Major findings

Silicon Valley’ s population is growing and becoming increasingly more global in character than in California or the US, as the region continued to draw more foreign immigration.
Silicon Valley continues to reinvent itself. Employment is growing. Innovation continues but is shifting to new areas. Average pay is up, and for the first time since 2001, median household income increased after a period of decline.
Old challenges continue to confront the region in the areas of education and health where disparities by race/ethnic group persist. High school graduation rates slipped, and crime increased. Despite revenue challenges, arts organizations are growing in number
Improvements in the region’s development pattern were achieved, yet housing affordability continues to be a challenge. Silicon Valley’s residents switched to hybrid vehicles and renewable energy sources.
Silicon Valley’ s vital non-profit sector continues to make valuable contributions to the community. While revenue from property tax levelled out in 2004, revenue from more volatile sales and other taxes increased modestly.



  1. Friedman T. 2005. The World is Flat. A Brief History of the Twenty-First Century. New York: Farrar, Straus & Giroux.