Regional Advantage of Cluster Development: A Case Study of the San Diego Biotechnology Cluster

The concept of “clusters” has become central to regional economic development strategies, especially in the high-technology and biotechnology industries. Numerous studies have examined the significance of industrial clusters and their components, but comparatively less attention has been directed towards understanding the roots and processes of industrial localization. In particular, emerging biotechnology clusters such as that in San Diego have not drawn adequate scholarly attention given their policy implications with regard to clustering and regional development. Based on in-depth interviews, historical archives and participatory observations, this paper examines how the San Diego biotechnology cluster emerged and grew into an entrepreneurial habitat that has nurtured hundreds of biotechnology companies that have produced a series of innovative products. The author suggests that the regional context of the existence of a number of small biotechnology companies rather than a group of large firms, a continuous flow of talent, and leadership that fosters collaborations have been critical in promoting knowledge creation, circulation and accumulation, which are essential to spawning startups. The regional advantage of San Diego in stimulating entrepreneurship and innovation lies in its edge in creating and exploiting knowledge and practices through its entrepreneurs' robust interactions and participation in local communities of practice.     

From Clusters to Platform Policies in Regional Development

This short briefing paper addresses the next stage in the evolution of regional development policy. It is clear that the cluster idea has held sway in this field for some 20 years. By now, practitioners and academics are widely sceptical of policy capabilities to create let alone build clusters. Recessionary times make this more difficult. Moreover, where some recent success can be seen, it is associated with command economies such as China where normal market and democratic barriers to large public investments in such measures are absent. Nevertheless, clusters exist in many places and there is evidence, displayed in this paper, that in some regions they have mutated into multi-cluster platforms. Now, as regions seek to rebalance, platform policies are evolving and being implemented. This paper shows how this is in part a response to “Grand Challenges” and the emergence of “challenge-driven” innovation.     

Regional Innovation Policy and Innovative Behaviour: Looking for Additional Effects

This paper aims to evaluate the additionality of innovation policy in terms of innovative behaviours at the regional level. Innovative behaviours are identified both within and across firm and regional boundaries. The role of policy is evaluated for a sample of firms in the Italian region of Emilia–Romagna (ER), exploiting an original, survey-based data set. Propensity score matching is applied to investigate the effects of an innovation subsidy. Funded firms are found to be more likely to upgrade their competencies, compared with similar non-subsidized firms. On the other hand, in most cases, innovation cooperation with other business partners within or outside the region is not significantly affected by policy. Ultimately, the investigated innovation policy in the ER region seems to show what might be termed “cognitive capacity additionality”, rather than “network additionality”.     

Credibility in Policy Expertise: The Function of Boundaries Between Research and Policy

As science becomes an increasingly crucial resource for addressing complex challenges in society, extensive demands are placed upon the researchers who produce it. Creating valuable expert knowledge that intervenes in policy or practice requires knowledge brokers to facilitate interactions at the boundary between research and policy. Yet, existing research lacks a compelling account of the ways in which brokerage is performed to gain credibility. Drawing on mixed‐method analysis of 12 policy research settings, I outline a novel set of strategies for attaining symbolic power, whereby policy experts position themselves and others via conceptual distances drawn between the “world of ideas” and the “world of policy and practice.” Disciplinary distance works to situate research as either disciplinary or undisciplinary, epistemic distance creates a boundary between complex specialist research and direct digestible outputs, temporal distance represents the separation of slow rigorous research and agile responsive analysis, and economic distance situates research as either pure and intrinsic or marketable and fundable. I develop a theoretical account that unpacks the boundaries between research communities and shows how these boundaries permit policy research actors to achieve various strategic aims.     

The Role of Interactive Learning to Close the “Innovation Gap” in SME-Based Local Economies: A Furniture Cluster in the Basque Country and its Key Policy Implications

This paper identifies an “innovation gap” in the (in)efficient relation between innovation structures and production systems in SME-based economies and, by elucidating an implicit aspect of key theoretical contributions from Lundvall and Cooke, among others, sets the basis for a policy focus that may help reducing those margins of inefficiency. In this work, we identify three interdependent drivers of innovation: the “critical mass” of firms in a specific geographical location; the formation of “organizations” devoted to the creation and diffusion of knowledge and innovations; the ignition of “learning processes” within the production system that help catalyse significant innovations within the local economy. We suggest that the importance of processes of codified knowledge flows needs to be complemented by interactive flows of tacit knowledge that help overcoming the “innovation gap” that often exists between firms and knowledge institutions. Since this gap represents the inefficiency of the innovation structures, we suggest that it should be targeted by policy-makers and business associations as a central issue for innovation promotion through actions that intensify interactions and learning processes through bottom-up initiatives. These elements are analysed in a furniture cluster in the Basque Country and are highlighted on the basis of successful micro-territorial experiences.     

Coping with Economic Crises—The Role of Clusters

The paper analyses the role clusters can play in coping with the impacts of economic crises, specifically by addressing how cluster organizations have acted to meet the challenges following the economic crises in Norway in the period 2008–2010. The paper investigates whether cluster maturity influences how the cluster acts in response to a crisis. To shed light on these questions, survey data from Norwegian cluster organizations were collected in two waves (spring 2009 and autumn 2010), and case studies of four cluster organizations provide further detail. The data indicate that clusters play a role in reducing uncertainty and improving access to necessary resources in crises periods. The data indicate that these advantages are not only due to increased collaboration between firms within the cluster, but that cluster organizations engage in considerable lobbying on behalf of their firms in regards to regional and national policy makers and public funding bodies. When comparing the impact experienced by mature and emerging clusters and their adaptation strategies, the data show that more mature clusters adapted to recent crises by implementing new innovation strategies and increasing collaboration and competence-building activities, to a greater extent than emerging clusters.     

Does Combinatorial Knowledge Lead to a Better Innovation Performance of Firms?

The knowledge base concept in the past was often applied in its “pure form”, i.e. it was assumed that there are dominant knowledge bases in particular sectors and firms shaping knowledge and innovation processes and related networks. For “analytical sectors” such as biotech, it has been argued that codified knowledge generated by universities and R&D organizations is the key for innovation, whereas “synthetic sectors” such as machinery innovate more incrementally by recombining existing knowledge often drawn from suppliers or service firms. Empirical literature has partly confirmed these patters, but also shown more complex knowledge processes. More recently it has been argued that combinations of different knowledge bases might enhance the innovation performance of firms. For example in “analytical sectors”, firms might benefit not just from new and basic knowledge generated by research, but also from recombining existing and applied knowledge or by drawing on symbolic knowledge. Combinatorial knowledge bases might also be relevant for “synthetic” and “symbolic sectors”, but in different forms. This study investigates for the ICT sector in regions of Austria if the reliance on combinatorial knowledge leads to a better innovation performance than the use of more narrow knowledge bases.     

Knowledge and Information Networks in an Italian Wine Cluster

The aim of this article is to analyse the nature and extent of knowledge and information networks in an Italian wine cluster. Moreover, the relation between firms’ characteristics and the knowledge network structure is also explored. The empirical findings show that knowledge is unevenly distributed in clusters and that networks of knowledge and information differ a great deal in terms of their structure. In fact, knowledge flows are restricted to a tightly connected community of local producers, differing in terms of knowledge assets, innovation behaviour and overall economic performance with respect to the rest of the firms in the cluster.     

Innovating in Cluster/Cluster as Innovation: The Case of the Biotechvalley Cluster Initiative

It has been noted that innovation seems to take place to a higher degree in clusters than elsewhere and we have lately seen a worldwide wave of emerging cluster initiatives and similar innovation policy projects. Some of these are realistic efforts based on existing regional strengths and partly existing cluster structures. Most, however, are grasping at straws. The latter is especially true when it comes to technologies such as IT and biotech. We could subsequently add a new label—“pathetic clusters”—to the already existing list of embryonic, emerging, world-class or stagnating clusters. But what do we make of such “pathetic clusters” (are they really pathetic)? Although economic geographers often tend to explain innovation (competitiveness) by looking at cluster dynamics, in such accounts, the cluster concept itself can actually function as an innovation, imposing similar effects on the economy as more familiar types of innovation would, i.e. by creating a local competitive edge. It is reasonable to believe that if “pathetic clusters” play important roles in regional economies, then they do so in the form of social and organizational innovations rather than as Porterian drivers of innovation and industrial dynamics on a large scale. This function of the cluster concept—as a local innovation—is the focus of the paper at hand.     

Evolution of Innovation Policy in Emilia-Romagna and Valencia: Similar Reality,Similar Results?

This paper examines the evolution of regional innovation policy in Emilia-Romagna and Valencia, two regions with similar economic features that implemented close innovation policies in the 1970s and 1980s. We investigate whether their similarities have led to parallel targets, policy tools and governance developments. We show that innovation policy in both regions suffered from the effects of privatization, budget constraints and changes to manufacturing during the 1990s and we highlight the consequences. Although Emilia-Romagna experienced deeper changes to its innovation policy, privatizations and/or the replacement of public funds promoted commercial approaches and induced market failures in both regions. The worst effects of these policies were the implementation of less-risky innovation projects, the shift towards extra-regional projects and markets, and the favouring of large firms.     

Same Sea,Different Ponds: Cross-Sectorial Knowledge Spillovers in the North Sea

Knowledge spillovers are crucial to innovation and upgrading, but it is largely unclear what knowledge spillovers are made of and how they actually happen. The importance of Marshall–Arrow–Romer vs. Jacobs externalities is also a debated matter, whereas the concept of “related variety” has recently come to occupy a middle-ground position. However, the relatedness concept is ambiguous in terms of operationalization and emphasizes codified knowledge on behalf of other knowledge resources that are important for innovation, particularly if firms cross into new sectors. This paper sheds light on the “black box” concepts of knowledge spillovers and relatedness by exploring cross-sectorial transfers from the mature offshore oil and gas sector into the emerging offshore wind industry. A qualitative research design allows for a more nuanced understanding of the contents of knowledge spillovers and (un)relatedness between sectors.     

Italian Industrial Districts on the Move: Where Are They Going?

Since the second half of the 1990s the Italian economy has experienced a significant slowdown in the rate of economic growth. The “dwarfism” of its manufacturing firms, their specialization in traditional sectors and their organization in industrial districts have been identified by many scholars as major structural weaknesses in the Italian industrial system. Nevertheless, there is a vast and flourishing empirical literature showing that many industrial districts are actually changing in terms of sector specialization, international and innovation strategies and emergence of new forms of enterprise organization. In this paper, we provide a critical survey of the new and different patterns of industrial organization emerging in industrial districts.     

Between Control and Empowerment: Governmental Strategies towards the Development of the Non-profit Sector in China

Continuous economic reform and social development have induced and forced the Chinese government to adjust its strategies towards non-profit development. Enhanced state capacities, emergent legitimacy of non-profit organisations, genuine demand for non-profit partners, public management modernisation and other factors have not only enriched the “control” mandate by introducing persuasive means, but have also driven the government to become a major empowering force for non-profit development. Advanced local governments in China take the lead in adopting mixed strategies of control and empowerment to forge a path of non-profit development in favour of non-profit organisations that are politically inactive and professionally capable. This paper shows the resilience of the regime by presenting examples of evolving governmental strategies of control and empowerment at the local and national levels. It argues that the Chinese government’s non-profit strategies are increasingly multidimensional and complicated, featuring changes in purpose, constraints, available means and government–non-profit relations.     

Why Every Cluster Cannot be a Successful Community?

The study of clusters is an important area of academic research. Clusters are also an important tool for public sector economic development. Historically, many organically developed clusters were based around a community of like-minded people. This may have led to a commonly held assumption in the literature that all clusters are communities. We suggest that not every cluster is also a successful community, based on empirical findings for four biotechnology clusters. Three issues of interests to practitioners are causes for clusters not being communities, the link between cluster success and development of “community” and policy failure at creating community within clusters. The discussion also aims to extend theory, first, by dealing with the rarely discussed question of the lack of collaboration “across” communities, and secondly, by attempting to help develop a theory of community formation in clusters.     

Managing Long Distance and Localized Learning in the Emilia Romagna Life Science Cluster

The paper provides some empirical evidence of the effectiveness of the “open innovation” model in the life science cluster of Emilia Romagna (a region of Italy), comparing the network of R&D collaborative activities in public research organizations (PROs) and the network linked to R&D collaborative activities in private firms. By presenting the main results of a field research in the life science sector in Emilia Romagna, we are contributing to the recent debate focused on the crises of the old “closed innovation” model and the rise of the “open innovation” model. Our survey consists of both primary data deriving from face-to-face interviews with researchers and entrepreneurs, and secondary data extracted from the Internet, the PubMed database, and from the European Patent Office. Our work is based on the analysis of a representative sample of 30 research groups in PROs, 2173 scientific articles published by the interviewed scientists, and a representative sample of 78 private firms.     

The Role of Knowledge Intermediaries in Developing Firm Learning Capabilities

Regional innovation systems (RISs) literature has emphasized the critical role of interactive learning and knowledge exchange amongst firms and a variety of spatially connected innovation institutions as the foundation of regional innovation. Knowledge intermediaries have been analysed in terms of the technology-transaction services they provide firms and/or knowledge producers such as universities and therefore the role they play in facilitating interaction within the RIS. However, innovation also depends on the capability of the firm to learn. Some studies have suggested that intermediaries also play a role in that regard as participation in intermediary knowledge transfer programmes can contribute to the development of firm capabilities for problem-solving and learning. Our research is based on two case study intermediary programmes involving interviews with facilitators and participants. Our data show that knowledge intermediaries affect organizational learning capabilities by impacting on firms' network relationships, internal and external communication channels and internal learning processes which in turn affect the ability to interpret and use knowledge within the firm. This suggests that the role of knowledge intermediaries might be greater than facilitating interactions in the innovation system, as knowledge intermediation may affect the ability of firms to learn and absorb knowledge from their environment.     

Building global knowledge pipelines: The role of temporary clusters

Business people and professionals come together regularly at trade fairs, exhibitions, conventions, congresses, and conferences. Here, their latest and most advanced findings, inventions and products are on display to be evaluated by customers and suppliers, as well as by peers and competitors. Participation in events like these helps firms to identify the current market frontier, take stock of relative competitive positions and form future plans. Such events exhibit many of the characteristics ascribed to permanent spatial clusters, albeit in a temporary and intensified form. These short-lived hotspots of intense knowledge exchange, network building and idea generation can thus be seen as temporary clusters. This paper compares temporary clusters with permanent clusters and other types of inter-firm interactions. If regular participation in temporary clusters can satisfy a firm's need to learn through interaction with suppliers, customers, peers and rivals, why is the phenomenon of permanent spatial clustering of similar and related economic activity so pervasive? The answer, it is claimed, lies in the restrictions imposed upon economic activity when knowledge and ideas are transformed into valuable products and services. The paper sheds new light on how interaction among firms in current clusters coincides with knowledge-intensive pipelines between firms in different regions or clusters. In doing so, it offers a novel way of understanding how inter-firm knowledge relationships are organized spatially and temporally.     

Firm Performance,Innovation Modes and Territorial Embeddedness

This paper seeks to identify different innovation modes and their territorial embeddedness, relating them to firms’ innovative and economic performance. We also analyse the relationship between the different innovation modes and the economic impact of the crisis on firms’ performance. These relationships are tested by regression and latent class models for the Portuguese population of firms, using a sample of 397 firms classified according to technological intensity, size and region. Our results show three different innovation modes: a DUI (Doing, Using and Interacting) mode, an STI (Science, Technology and Innovation) mode and a TEI (Territorial Embeddedness Innovation) mode in which territory plays a key role. These innovative modes are related in different ways to firms’ economic and innovative performance and also have marked distinctions in terms of resilience to the economic crisis. These findings lead to a reflection on regional innovation policy in the European context.     

Competition and Cooperation in Industrial Clusters: The Implications for Public Policy

Alfred Marshall believed that, while the benefits of clusters resulted from cooperation between firms, competition was an important driving force. In contrast, contemporary theories of clusters place most emphasis on collective action. This article seeks to distinguish processes of competition and cooperation within clusters, through a critical reading of different theoretical approaches. This distinction has important implications for the scale and nature of public policy. An emphasis on competitive processes implies a more macro-economic role for public agencies in seeking to raise investment in innovation while the fostering of cooperation implies measures to support decentralized public-private research collaborations.