For one thing, state funding begets federal funding: Federal grants from the National Institutes of Health aren't given to schools; they are given to scientists, and if those scientists move, the grant money moves with them.
Talent moves with these top researchers, too—“like a baseball player will help you win a pennant but they also put fans in the seats,” as Goldman put it.
Jo Wiederhorn, president and C.E.O. of AMSNY, points to a 2010 study from Tripp Umbach, which estimates that for every $1 of investment, the state sees $7.50 of economic output.
An example of how that works: In 2012, Weill Cornell Medical College poached Dr. Lewis C. Cantley, a professor at Harvard and Director of the Cancer Center and chief of the Division of Signal Transduction at Beth Israel Deaconess Medical Center. Cornell's pitch included its brand-new cancer center, with new labs and new equipment. But Cantley doesn't come alone. He brought a staff of post-docs and lab technicians, fellow researchers. Those are all good-paying jobs, and that staff needs a place to eat lunch, take its dry cleaning, etc.I should point out here that postdoctoral salaries are not poverty wages by any means, but I strongly disagree with calling them "good-paying jobs". At the very best, they're "temporary appointments that provide a modest income."
Is there any evidence of big PI moves that have actually helped establish or cement a new institution's reputation? I'd like to think so, but I suspect that evidence is thinner than boosters would suggest.