Using information from the case, conduct general research and describe some ways in which Massachusetts was able to reinvent its economic base. How do the methods used align with the concept of innovation systems and processes? Place yourself in the role of a community/political leader in your area. Would your community (either state or local) be able to innovate in a way similar to Massachusetts? Do any innovative processes exist that would make this possible? If it were your job to make this happen, what are some steps that you might take? CASE STUDY 2.3 The Power of Regional Innovation Systems Michael Bests fascinating account of the ways in which the Massachusetts economy managed to reinvent itself several times is one which underlines the importance of innovation systems. In the 1950s the state suffered heavily from the loss of its traditional industries of textiles and shoes but by the early 1980s the Massachusetts miracle led to the establishment of a new high-tech industrial district. It was a resurgence enabled in no small measure by an underpinning network of specialist skills, high-tech research and training centres (the Boston area has the highest concentration of colleges, universities, research labs and hospitals in the world) and by the rapid establishment of entrepreneurial firms keen to exploit the emerging knowledge economy. But in turn this miracle turned to dust in the years between 1986 and 1992 when around one third of the manufacturing jobs in the region disappeared as the minicomputer and defence-related industries collapsed. Despite gloomy predictions about its future, the region built again on its rich network of skills, technology sources and a diverse local supply base which allowed rapid new product development to emerge again as a powerhouse in high technology such as special purpose machinery, optoelectronics, medical laser technology, digital printing equipment and biotech.33