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Create global knowledge investment zones (GKIZs) to attract foreign direct investment.

The federal government should identify a limited number of global knowledge investment zones as a key mechanism for attracting high-value-added foreign direct investment. Firms located in these zones would be eligible to receive a number of benefits, including: 1) The ability to write off (on federal taxes) all capital expenditures in the first year; 2) A collaborative R&D tax credit of 25 percent on all expenditures on research made at the associated universities in the GKIZ. For companies that are not yet profitable, tax benefits could be applied against payroll taxes; 3) Streamlined access to university technology, with university zone participants agreeing to implement leading-edge intellectual property and technology transfer practices, including “standardized” licensing agreements and policies to encourage faculty entrepreneurship, industry engagement, and technology commercialization; 4) Access to better-funded NSF I/UCRCs; and 5) Visa preferences by tapping into the unused portion of existing EB-5 visas.