The 2007 State New Economy Index, released Feb. 27 by the Ewing Marion Kauffman Foundation and the Information Technology and Innovation Foundation (ITIF) ranks states based on 26 indicators. Previously released in 1999 and 2002, RI ranked 29 in 1999, 23 in 2002 and 15 this year.

Robert Atkinson, president of the Information Technology and Innovation Foundation, said he thinks it could be a result of...Having the country’s most generous research and development tax credit also helps.

Atkinson, who was executive director of the R.I. Economic Policy Council from 1996 to 1997, said the state’s No. 2 placement on the sub-index measuring industry investment in R&D might be a direct reflection of its R&D tax credit, which was instituted in the late 1990s.

The state’s intense focus on making the “innovation economy” a central theme of economic development efforts during the past three years also might have been a factor.

Formation of the Science and Technology Advisory Council in 2005...and resources such as the Slater Technology Fund...also make Rhode Island a desirable location for innovative companies.

RI also jumped from 43rd in 1999 to 12th in 2007 for venture capital invested as a percentage of worker earnings and ranked 5th for scientists and engineers as a percentage of the workforce.