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Invention and Reinvention: The Evolution of San Diego’s Innovation Economy

Author(s):Walshok, Mary Lindenstein
Shragge, Abraham J.
Reviewer(s):Smith, Fred H.

Published by EH.Net (May 2014)

Mary Lindenstein Walshok and Abraham J. Shragge, Invention and Reinvention: The Evolution of San Diego’s Innovation Economy.  Stanford, CA: Stanford University Press, 2013. xvii +  227 pp. $25 (paperback), ISBN: 978-0-8047-7520-5.

Reviewed for EH.NET by Fred H. Smith, Department of Economics, Davidson College.

San Diego is a city blessed with exceptional weather and a picturesque coastline.  It is also a city that some might associate with a strong military presence, a world-class zoo, and mediocre professional sports teams.  I suspect that relatively few individuals would associate San Diego with the words “invention” or “innovation”; these words are reserved for San Diego’s neighbors to the north: Palo Alto, Berkeley, San Francisco, and San Jose.  However, in Invention and Reinvention sociologist Mary Walshok and historian Abraham Shragge show their readers that San Diego truly is a city of invention and innovation.

Invention and Reinvention tells its story chronologically.  Starting with an introduction that motivates their work and provides a roadmap for the remainder of the book, Walshok and Shragge then proceed to cover the periods from the city’s founding to World War II (chapter two), the post-war period until 1969 (chapter three), and the city’s “coming of age” between 1969 and 1984 (chapter four).  Chapter five focuses on the linkages that have developed or evolved between the city’s scientific community and its business community during the last thirty years. Chapter six offers concluding remarks and identifies ways in which the case study of San Diego might be informative for leaders from other cities.  I’ll briefly highlight some of the key points that the authors make in these chapters before discussing the book’s strengths and weaknesses.

Walshok and Shragge use the preface to bring San Diego’s greatest paradox to the reader’s attention: “No one seems to see the city’s foundational paradox: Its prosperity comes from living off the federal taxation system. … That simply does not match the community’s antigovernment, antitax political culture” (p. 3).

Federal tax dollars flow into San Diego through several different sources, but none is more important than the United States military.  The military plays such a critical role in the city’s economic history that Walshok and Shragge devote the entire second chapter to describing San Diego’s evolution into a “martial city.”  San Diego wasn’t an obvious choice for the U.S. military to have established a strong presence.  The authors suggest that other ports – Seattle, San Francisco, etc. – might have served the military just as well as San Diego.  However, the efforts of San Diego’s Chamber of Commerce and William Kettering (a Chamber director who was elected to Congress in 1912) ensured that San Diego would become the site of several military installations.  Of particular note in this chapter is the clear evidence Walshok and Shragge provide to support the notion that San Diegans knew how beneficial it would be for the  city to have a substantial military presence.  Indeed, early San Diegans realized that military facilities provided an engine for economic growth that required little local spending on infrastructure.  Moreover, the Great Depression taught San Diegans the lesson that a strong relationship with the federal government insulated the local economy from macroeconomic shocks.

The post war period was a time of “reinvention” for San Diego.  Walshok and Shragge report that in the years immediately following World War II 60 percent of the region’s GDP was directly attributable to the military’s presence.  While military spending wasn’t to dry up any time soon, city leaders realized that San Diego’s economy would rest more solidly on a broader foundation.  In chapter three, the authors argue that the city’s efforts to recruit General Dynamics/General Atomic made it clear to civic leaders that the presence of a research institution would strengthen San Diego’s case.  The University of California, San Diego opened in 1960 and has been a leader in scientific and medical research since it was founded.  Despite UCSD’s successes, Walshok and Shragge suggest that it would be wrong to award too much of the credit for the city’s economic success to the university.  Instead, they argue that the city’s success is attributable to the relationships between a mixture of San Diego’s attributes – location, a strong military presence, and the presence of a world-class research institution – that require more careful consideration to fully comprehend.  The process of “reinvention” has continued in recent decades as institutions/programs such as UCSD’s CONNECT have worked to link the business community with the research community.  CONNECT has worked to bring researchers together with entrepreneurs and venture capitalists so that research finds a home in the marketplace.

As an economic historian, reviewing Invention and Reinvention presents some challenges.  While the book is certainly full of content that is rightfully identified as economic history, it also contains a good deal of material that examines San Diego’s history from a sociological perspective. But, as a work of economic history, the book is successful.  Chapters two through five are detailed, well-written accounts of San Diego’s economic “evolution.”  These chapters are written so as to be entirely digestible as stand-alone documents; you needn’t have read chapter two to be able to follow the authors’ narrative in chapter three.  This is one of the book’s great strengths, and it is easy to envision individual chapters of this book being assigned for a class depending on the subject matter of the course.

The mark of a good case study – whether it is a book or an academic paper – is the extent to which it tells us something more about the world beyond the subject of the study.  In both chapter one and chapter six Walshok and Shragge make a concerted effort to establish their position that San Diego, while unique in many respects, is similar enough to other U.S. cities that its experiences might serve as a guide for how to cultivate an economy that is flexible for changing times.  The authors emphasize the importance of several characteristics of a city in determining a city’s ability to adapt and thrive:  The city’s location, its core values, and the ways in which the city’s leaders promote and cultivate the city’s strengths.  Walshok and Shragge do a terrific job of describing how San Diego’s location, core values, and ability to promote and cultivate its strengths have led to San Diego’s success in the twenty-first century.  What is less clear to me is how San Diego’s experiences are generalizable.

San Diego’s experiences seem to be born of a combination of location-specific factors that few cities can compete with and prescient, hard-working community leaders who were in the right place at the right time.  San Diego’s leaders leveraged its early successes in attracting the military to the city to achieve future successes – not the least of which was securing the construction of an exceptional research institution, UCSD.  Can leaders of other cities, especially leaders of cities that do not possess some of San Diego’s natural advantages, learn much from San Diego’s experiences?  I’m not convinced of this.

The book also doesn’t live up to the initial promise it emphasizes so clearly in the preface – that San Diego is a city built on a remarkable paradox.  The city’s success was, and is, due in no small part to federal tax dollars being spent in the region.  And, yet, San Diegans remain politically conservative and inclined to support candidates who favor “small government.”  I’d like to have seen the authors revisit this point a bit more explicitly in the core chapters. I also wonder to what extent we might see parallels between San Diego and other cities with conservative political cultures that feed at the “federal trough.”

Ultimately, the book’s shortcomings are relatively minor.  It is a very worthwhile read for an economic historian, for it provides a thorough introduction to the city’s economic history.  Moreover, even if the book doesn’t provide a clear answer, it forces the reader to think about why San Diego’s experience has been so different from U.S. cities that have not done well over the past half century.

Fred Smith is a professor of economics at Davidson College.  His most recent work “The Economic History of Urbanization” appeared in The Routledge Handbook of Modern Economic History, edited by Randall Parker and Robert Whaples (2013).

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Subject(s):Urban and Regional History
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII