Entrepreneurial Impact: The Role of MIT

Abstract:     
Research- and technology-intensive universities, especially via their entrepreneurial spinoffs, have a dramatic impact on the economies of the United States and its fifty states. A new report on just one such university, the Massachusetts Institute of Technology, indicates conservatively that, if the active companies founded by MIT graduates formed an independent nation, their revenues would make that nation at least the seventeenth-largest economy in the world. A less conservative direct extrapolation of the underlying survey data boosts the numbers to 25,800 currently active companies founded by MIT alumni that employ about 3.3 million people and generate annual world sales of $2 trillion, producing the equivalent of the eleventh-largest economy in the world.

These findings result from an analysis of MIT alumni-founded companies and the entrepreneurial environment that fosters this new-company creation. Conducted by Edward B. Roberts and Charles Eesley of the MIT Sloan School of Management, the report is based on a 2003 survey of all living MIT alumni, with additional detailed analyses, including verification and updating of revenue and employment figures to 2006 from records of Compustat (public companies) and Dun & Bradstreet (private companies).

Number of Pages in PDF File: 12

Keywords: mit, massachussetts institute of technology, alumni, spinoff, entrepreneurship, survey

JEL Classification: N9, 018, L26, C8

working papers series