Regional Competitiveness Institute

Various factors and connections contribute to the economic vitality of a community or region. The Regional Competitiveness Institute (RCI) seeks to understand these factors and connections, evaluate how they can be leveraged for future growth, and track their progress over time.

This work includes but is not limited to:

  • Establishing region-specific metrics to measure performance in community development and economic competitiveness over time through a regional competitiveness dashboard;
  • Applying the frame of industry cluster theory to Minnesota’s most competitive and promising economic clusters – and understanding how human capital, infrastructure, innovation, and institutions all contribute to an ecosystem of economic competiveness;
  • Nurturing rural-metro linkages, such as between rural production and metro-based added value;
  • Addressing Minnesota’s labor shortage and how job training, career pipelines, and immigration each play a role in filling vacancies and spurring growth;
  • Understanding how transportation investment can spur economic development, how “smart grid” and “smart city” interconnectivity can be leveraged for economic growth and opportunity, and how technology can improve quality of life and service delivery generally, including improvements in traffic congestion, freight logistics, and economic productivity in particular;
  • Promoting constructive dialogue around difficult and divisive issues, such as immigration and Minnesota’s real and perceived rural-metro divide.

The RCI builds on the State and Local Policy Program’s strong record of effective outreach and education to translate University of Minnesota research, resources and innovation into sustainable economic growth and shared prosperity throughout the state.

Industry Clusters

Dynamic and innovative industry clusters are critical for the success of a regional economy. The industry cluster approach has increasingly generated interest among regional, state and national policy leaders. As an analytic tool, it affords a deeper understanding of the local economic base and offers the chance to deploy resources more strategically. The State and Local Policy Program has conducted regional industry cluster studies throughout Minnesota since 1995, documenting Minnesota’s competitive industry clusters. More recently the program has focused on the role that industry clusters can play in understanding the freight economy and implications for transportation policy.

Understanding Your Industry Cluster

These quantitative and qualitative tools for identifying the key industries in your area will guide you through using online data sources to calculate location quotients and shift share analysis, as well as using qualitative criteria to further analyze key clusters. Understanding the key industries in your area will allow you to develop improved strategies for economic development, by helping to focus on these dynamic sectors of your economy. The process should take you a few hours, and your results will be similar to what many cities and regions pay private consultants to do.

Transportation Policy and Industry Clusters

Freight transportation plays a considerable role in economic and community life in Minnesota, but exactly how freight transportation ensures the success of these clusters and enhances the competitiveness of the region is not well understood. To maximize this success, MnDOT and other transportation planners need to plan for and respond to the transportation needs of its customers. One aspect of this effort will be to improve knowledge of the characteristics of those industries that make the greatest use of the transportation system, and derive some of the greatest benefits from it.  SLPP in collaboration with Claremont Graduate School has developed a interactive National Freight Economy Atlas, which features maps and stories about industry clusters and their supply chains.  SLPP has also collaborated with MnDOT interviewing and analyzing the perspectives of manufacturers on Minnesota’s transportation system in Southwest and West Central Minnesota (District 8), West Central Minnesota (District 4), and Northwest Minnesota (District 2).

U.S. Cluster Mapping Website

RCI has been the Midwestern regional partner with Michael Porter’s group in developing the U.S. Cluster Mapping website for the U.S. Economic Development Administration.  In 2014 the Humphrey School hosted the launch of the new interactive cluster mapping tool with Michael Porter at a conference Mapping the Midwest’s Future: Regional Innovation Clusters and Competitiveness.

Microeconomics of Competitiveness Course

Since 2006, the State and Local Policy Program has taught Microeconomics of Competitiveness: Firms, Clusters and Economic Development (MOC), a course developed by Harvard Business School Professor Michael Porter. The course has been offered both as an executive development course for Minnesota Department of Employment and Economic Development (DEED) workforce development staff and as a capstone workshop for Humphrey School graduate students.  

The Minneapolis-St. Paul Regional Cluster Initiative

The Regional Cluster Initiative (RCI) was a collaborative effort to grow, retain, and attract jobs in the Greater Minneapolis-St. Paul region. It represented a major first step in practicing regional economic development utilizing an industry cluster approach. RCI's work included:

  • Ten competitive traded clusters in Minneapolis-St. Paul were identified.
  • Regional mayors selected three clusters for further research, outreach and engagement - Medical Devices, Financial Services, and Distributional Services.
  • Mayors interviewed CEOs to identify strengths/opportunities, and to build private-public relationships.
  • Two areas selected for further action: medical devices cluster and corporate headquarters concentration.

Minneapolis-St. Paul Regional Cluster Initiative: Providing a Framework for Minnesota's Economic Competitiveness (2012)

CEO to CEO Conversations - Mayors Talk with Business Leaders About Growing Jobs in Minnesota (2011)
Minneapolis-St. Paul Cluster Competitiveness Study (2013)

Rural Knowledge Clusters

A number of notable rural success stories suggest the possibility that rural communities can develop their own centers of knowledge-based activity. The rural knowledge cluster framework builds on Michael Porter's "Diamond of Advantage"—Factor Conditions, (Home) Demand Conditions, Related and Supplier Industries and Industry Strategy and Rivalry—by placing added emphasis on the instrumental role of knowledge as the driver of innovation and competitive advantage.

Principles of Economic Development

Economic development is a concept whose definition often depends on who is doing the talking.  Economists, elected officials, development professionals, and citizens all are likely to have varying perspectives on the subject. The basic framework begins with the assumption that the object of development is to create wealth, whether on a national, regional, or local level.  However, it is here that the many perspectives diverge.  As a background, the SLPP developed 10 Principles in Economic Development.

State and Local Policy Program

Humphrey School of Public Affairs
301 19th Avenue South
Minneapolis, MN 55455