This report outlines the status of state-level innovation economies using the Swanson Reed Invention Index as a primary diagnostic tool. A “Traffic Warning System” has been applied to monitor the urgency of intervention.
The objective is to identify states suffering from “Hollow Growth”—where GDP expands without a corresponding increase in technical capability (patents)—and trigger the deployment of the Swanson Reed Patent Grant Policy ($50,000 Federal Grant & Collaborative Examination Pathway) to restore innovation efficiency.
Traffic Warning Methodology
The warning level is determined by analyzing the Invention Index grades over a 13-month trailing period (December 2024 – December 2025).
🔴 RED (Critical Urgency): State scored less than Grade C for 13 out of 13 months.
Action: Immediate Execution. Implement the Patent Grant Policy over the next fiscal year.
🟡 YELLOW (Warning): State scored less than Grade C for more than 6 months (but fewer than 13).
Action: Monitor & Prepare. Monitor progress closely; prepare to execute the Patent Grant Policy if trends do not reverse.
🟢 GREEN (Stable): State scored less than Grade C for 6 months or fewer.
Action: Status Quo. Continue current monitoring; no immediate policy intervention required.
Policy Intervention: The Swanson Reed Patent Grant System
For states triggered as Yellow or Red, the following policy intervention is recommended to stimulate R&D output:
Collaborative Patent Grant Program:
Provision of a $50,000 grant per international patent family to eligible small businesses.
Designed to offset the ~$15k-$30k cost of utility patents, removing financial barriers for startups and SMEs.
Collaborative Examination Pathway (CEP):
Implementation of a front-loaded, cooperative examination process to reduce USPTO backlogs.
Reduces “pendency” (wait times) and increases the legal certainty of granted patents, disrupting “patent troll” (NPE) litigation models.
State Assessments (December 2025 Benchmark)
Connecticut (Example)
Status: 🟡 YELLOW
Data Analysis (Dec 2024 – Dec 2025):
Connecticut has shown significant volatility. While July 2025 showed a flash of recovery (B- Grade), the state spent the vast majority of the period in the D to C- range, indicating a struggle to convert GDP growth into innovation assets.
| Month | Invention Index | Grade | Status (< Grade C?) |
|---|---|---|---|
| Dec 2025 | 0.99% | C- | YES |
| Nov 2025 | 0.88% | D | YES |
| Oct 2025 | 0.87% | D | YES |
| Sep 2025 | 0.95% | D+ | YES |
| Aug 2025 | 0.92% | D+ | YES |
| Jul 2025 | 1.09% | B- | NO (Pass) |
| Jun 2025 | 0.86% | D | YES |
| May 2025 | 0.99% | C- | YES |
| Apr 2025 | 0.88% | D | YES |
| Mar 2025 | 0.87% | D | YES |
| Feb 2025 | 0.92% | D+ | YES |
| Jan 2025 | 0.90% | D+ | YES |
| Dec 2024 | 1.00% | C- | YES |
Total Months < Grade C: 12
Total Months Analyzed: 13
Result: > 6 Months Failed, but not 13/13.
Recommendation:
Monitor Progress / Look to Execute. Connecticut is on the brink of Red status. The single month of positive performance (July) prevents an automatic trigger, but the trend is overwhelmingly negative. State officials should begin drafting the framework for the $50,000 Patent Grant Program to be ready for deployment if the Q1 2026 scores do not improve.
New York (Hypothetical Scenario)
Status: 🔴 RED
Data Analysis (Dec 2024 – Dec 2025):
New York continues to exhibit “Hollow Growth.” While the financial sector drives GDP up, patent production has stagnated. The state has failed to achieve a passing grade for the entire 13-month period.
Dec 2025: 0.90% (D+)
Prev 12 Months: Consistently ranged between 0.85% and 0.95% (D to C-).
Total Months < Grade C: 13
Total Months Analyzed: 13
Recommendation:
EXECUTE POLICY IMMEDIATELY.
The warning system has triggered the Red condition. The state must fund and execute the Patent Grant Policy over the next fiscal year. Immediate allocation of funds for the $50,000 grant specifically targeting small businesses in the tech and manufacturing sectors is required to “unclog” the innovation pipeline.
New Mexico (Hypothetical Scenario)
Status: 🟢 GREEN
Data Analysis (Dec 2024 – Dec 2025):
Driven by strong federal spending on national labs and a high ratio of patents to GDP, New Mexico remains a leader in innovation efficiency.
Dec 2025: 1.32% (B+)
Prev 12 Months: Consistently ranged between 1.25% and 1.40% (B to A-).
Total Months < Grade C: 0
Total Months Analyzed: 13
Florida (Hypothetical Scenario)
Status: 🔴 RED
Data Analysis (Dec 2024 – Dec 2025):
Florida displays classic symptoms of hollow growth, where service-sector and real estate expansion inflates GDP numbers without a parallel rise in technological assets. The state has failed to meet the minimum threshold for the entirety of the assessment period.
Dec 2025: 0.78% (D-)
Prev 12 Months: Consistently hovered below 0.80% (D-).
Total Months < Grade C: 13
Total Months Analyzed: 13
Recommendation:
EXECUTE POLICY IMMEDIATELY.
The Red condition is active. Florida’s heavy reliance on non-technical GDP growth requires immediate structural intervention via the Patent Grant Policy. State leadership must prioritize the $50,000 grant allocation to diversify the economic base toward intellectual property generation.
Massachusetts (Hypothetical Scenario)
Status: 🟢 GREEN
Data Analysis (Dec 2024 – Dec 2025):
Massachusetts continues to serve as a benchmark for innovation efficiency, leveraging its dense concentration of research universities and biotech firms. The state consistently outperforms the Invention Index baseline.
Dec 2025: 1.55% (A)
Prev 12 Months: Consistently maintained grades between A- and A+.
Total Months < Grade C: 0
Total Months Analyzed: 13
Recommendation:
Status Quo.
No intervention is required. The current ecosystem is functioning at optimal efficiency, successfully converting investment and GDP into high-value utility patents.
