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Silicon Valley and Finland 53Table 2.1Production of technology and social inclusionAdvancedUS Finland economiesProduction of technologyinnovation (measured by 130 (4) 126 (5) 56receipts of royalties andlicense fees US$ per 1,000pop.)High-tech exports (%) 32 (4) 27 (8) 18Social inclusionRichest 20% to poorest 20% 9.0 (–3) 3.6 (3) 5.8(ratio)People below the poverty line 14.1 (–4) 3.8 (4) 10.6(%)The figures in parentheses mark position on a ranking of the advanced economies (the minus signcounting from the bottom).Source: UNDP (2001)inclusion (low level of poverty and income inequality), while the US comes atthe bottom of these lists (see table 2.1). In fact, in the US, the information technology-ledeconomic revolution which began in the 1970s has put the levelsof social inequality (measured by the Gini index) and exclusion (measured bythe incarceration rate which reflects how many people are left with only crimeas a means of survival) on a dramatic rise. In Finland, the information technologyrevolution has been accompanied by a fall, and then a continued lowlevel, of social inequality and exclusion, as we can see in figure 2.4.Let us now analyze the dynamics behind these results which are very similaron technological and economic measures but very dissimilar on socialmeasures. We will start with the Silicon Valley model and then contrast it withthe Finnish model.THE SILICON VALLEY MODELThe history of the development of Silicon Valley as the world’s premier milieuof technological and entrepreneurial innovation of the information technologyrevolution is well known (Castells and Hall, 1994; Saxenian, 1994). The beginningof Silicon Valley can be traced back to the founding of Hewlett-Packard