Massachusetts
A large element in the wave perspective revolves indirectly around what academic’s call subsidies which is a code word for private sector incentives, and practitioners call tools and programs. Waves differ on the configuration and beneficiaries. We would agree at one level, but not others. The incentives would not have had much effect before 1975 and employment growth slowed noticeably post-1975, peaking in 1985. In any case, the bulk of Route 128’s employment growth had been achieved before 1973. The claims of Michael Dukakis, elected in 1975, as being responsible for the Massachusetts Miracle is even more suspect. Gov. King– Still, despite the resumption of federal defense contracts, defense spending never came close to levels funded during Route 128’s more golden years. Between 1965-1980 the share of high tech business conducted for the federal government fell from 60 to 25 per cent in Massachusetts. This Route 128 (and the Pacific version, Silicon Valley) don’t neatly fit into these rather rudimentary distinctions
Even still. Massachusetts soon after encountered a serious property tax rebellion. Prop 2 1/2 principal benefits of accrued to the elderly homeowner. It was not clear how technology firms benefited.
Massachusetts had over the past decade implemented business climate reforms.
Post 1985 Aftermath–Other non-Route 128 based technology, including biotechnology, robotics, material, and artificial intelligence reshaped both overall state and New England numbers. 3x faster than all other sectors combined Business services, computer services, data processing services and software grew at a faster rate (95%) and accounted for 30% of all new service sector jobs.[1]
The fairly widespread perception, supported by subsequent literature and employment data, business commentary and simple public perception is that Route 128 did not sustain its initial advantages. This is hotly contested by the locals, who are simply tired of defending themselves, and who allege, correctly, that the Massachusetts technology sector (led by bio-tech, clean and green tech, and some “cloud” applications) is still a powerhouse that most other regions and communities would kill to have. It is also descriptive that the location of current Massachusetts high tech agglomeration is less Route 128 than the geographies surrounding Cambridge and downtown Boston and to some extent the North Shore up to Southern New Hampshire. Geographically, the Massachusetts Miracle did help areas around Boston and up through New Hampshire, but the remainder of the state was essentially stagnant. Rosegrant and
Lampe conclude:
… the lesson of the Massachusetts experience is that these firms developed here not by design but because an elaborate complex of institutions and traditions gave them a reason to grow. Knowledge had become Massachusetts most prized resource. In addition to providing local entrepreneurs with ideas to take to the marketplace, the expertise represented by the area’s academic institutions and its high tech infrastructure has become a key attraction for research and development operations of companies based elsewhere, particularly from Japan or Europe. Massachusetts benefited particularly because one of the technologies developed in the region–the computer– unexpectedly proved to have enormous international market potential. Not only did this create a wealth of new manufacturing jobs in the region, it spawned a host of related high-growth businesses, ranging from software to data processing.
…. no individual or organization from business, academe, or government can claim credit for consciously engineering this development. It happened by itself, fostered by a remarkable combination of favorable conditions from the particular culture of the region and by chance[2].
Route 128 employed 85,000 workers in 1970 and Silicon Valley about 60,000. By 1975, Route 128 employed about 100,000 workers–Silicon Valley about 110,000. At no point after 1975 did Route 128 exceed employment levels of the Silicon Valley. By 1990, Silicon Valley employed 255,000, Route 128 about 150,000. Route 128’s peak employment was 1985, around 160,000[3]
[1] David R. Lampe, The Massachusetts Miracle (Cambridge, MIT Press, 1988), p. 13
[2] David R. Lampe, The Massachusetts Miracle (Cambridge, MIT Press, 1988), pp. 17-18
[3] Saxenian, op. cit. Regional Advantage, Figure 1, p. 3. 1959-1990 County Business Patterns
Ron W. Coan 