[h1karu]

>Provide incentives to attract scientists, firms and users;

> Establish a favorable business environment and regulations.

> Except … this approach to innovation clusters hasn’t really worked. Some have even dismissed these government-driven efforts as “modern-day snake oil.”

I would argue that such an approach has never actually been attempted only lip service has been paid. The types of solutions you describe above are politically untenable because they involve significantly lowering taxes.

I would say that Nevada is an example of a place where this kind of approach has worked. Look at Las Vegas it's a metropolis that sprung up out of nowhere in the middle of a vast desert wasteland. Maybe Michigan could learn a thing or two from Nevada and begin by lowering it's state income tax to 0%.

[judk]

Las Vegas is big because of the gambling money, not tax structure. Compare to the rest of the state.

[h1karu]

Las Vegas got it's start because of the gambling money, but it has maintained itself as nationally relevant over the years despite it's inhospitable weather and isolated environs due to low taxation but also because of the "hands off of business" stance that the state has taken which is helpful to a diversity of industries other than just gambling, ask Zappos CEO about it.

In my opinion it's not a terrible choice of a place to launch a startup either because you could poach employees away from both the Bay Area and LA job markets by showing them what kind of spacious luxury highrise accommodations they could be enjoying for similar money to what they spend on their 600square foot rental in the City. The fact that they'd pay no state income taxes just makes the job offer all the more enticing. I suspect there's going to be more of this kind of thing going on in the future especially as Zappos continues to invest significant funds into renovation of certain districts.