successful cases is that they are entrepreneurial explorations, experiments, and discoveries that undertake considerable risks and create public benefits through the learning that takes place, which markets will not adequately facilitate. The incentives provided by the government are neither aimed at supporting the whole sector nor one single firm but at the learning and the growth of a new activity. This focus achieves two things: it (indirectly) improves the general performance of the sector, while building capabilities to succeed in new fields. A similar approach informs Manizales Más, a regional program to strengthen the entrepreneurial and innovation system in Caldas, Colombia (see box 8.3). Again, the goal is not to support a particular product but to strengthen entrepreneurship and technological capability and to redress market failures, such as in finance.
BOX 8.3 Strengthening a Regional Entrepreneurial and Innovation System for a Midsize City: Scale Up Manizales (Manizales Más) in Colombia In 2013, the municipality of Manizales in the department of Caldas in central Colombia embarked on a program named Scale Up Manizales (Manizales Más) to strengthen its entrepreneurial and innovation system, partnering with two US universities in the Boston area—Babson College and the Massachusetts Institute of Technology (MIT)—and local institutions. Manizales’s status as a medium-size city (population 434,000) is an important part of the story because even in 2050, megacities will still number just a few dozen, while thousands of midsize cities (with 500,000 to 5 million people) will house 92 percent of the world’s urban dwellers (Isenberg and Onyemah 2017). Similar programs—Scale Up Milwaukee (United States), Scale Up Rio (Brazil), and Scale Up Vaud (Switzerland)—have followed. Though Manizales passed through a period when dynamism slowed, it has a solid enabling environment. Located at the north of an excellent highway linking the prosperous cities along the coffee axis (Eje Cafetero) and with decent connections abroad, it has a long tradition of coffee entrepreneurship; a solid industrial base anchored in Luker Agricola, a major agro-export processer whose foundation supported the program; and a large number of universities. It has among the highest Doing Business indicators in Colombia—so starting and growing businesses is relatively easy. Scale Up Manizales tackled several dimensions to improve the local entrepreneurial and innovation system. It worked to strengthen university preparation of entrepreneurs; attempted to shift cultural norms to support entrepreneurship; developed an accelerator program to boost growth in existing businesses, including initiating exports; and offered business ecosystem training for local leaders in all levels of government, universities, and financial institutions. It also introduced Start Up Más to help students formulate business ideas; AddVenture-Más to accelerate start-ups with product concepts; and Scalerator programs to stimulate rapid growth within established ventures. It initiated a Finance Innovation Task Force to develop innovative debt-equity financial instruments, developed a platform with the MIT Venture Mentoring Service (Box continues on the following page.)
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Place, Productivity, and Prosperity
