Evaluating European Regional Innovation Strategies

In this paper we analyse the degree of achievement of the Regional Innovation Strategy goals. This is an European Union Commission policy oriented toward the promotion of regional Science, Technology and Innovation (STI) policy design through the involvement of regional stakeholders. We analyse two categories of objectives: those dealing with process participation and those dealing with behavioural change. Our results show that the overall achievement of the goals is meaningful: the former have been achieved in a larger extent than the latter ones. However, other aspects such as multidisciplinary, and the establishment of a monitoring and evaluation system have not been so fruitful.     

Bayesian Analysis of Knowledge Spillovers in European Regions*

Abstract. This paper estimates the effects of knowledge spillovers on patent growth rates across 335 European regions over the 1989–1999 period. We propose a dynamic model based on an innovation production function. A Bayesian approach is used to take into account area‐specific innovation and spatial spillovers. The estimation of the model proceeds via Markov Chain Monte Carlo simulation. The results show significant positive and negative spatial effects on innovative activity. The model allows for a rich spatial specification, which we illustrate by incorporating transport proximity measured by transportation time between regions to augment the typical spatial proximity measure of connectivity between regions. Doing this produces more pronounced spatial spillovers that exhibit a more polarized spatial pattern than a model relying on spatial proximity alone.     

Regional Externalities And Growth: Evidence From European Regions*

Abstract. This paper models externalities of production across regional economies. Under the assumption that knowledge diffuses without political or administrative barriers, we derive externalities that affect the steady state and the process of growth of each economy. The empirical counterpart of the reduced form equation summarizing the process of growth allows us to test for the presence of regional spillovers and to measure their magnitude. Our results for a sample of European regions show that spillovers are far from negligible, are robust to the consideration of variables within each region, and may cause nondecreasing returns at the spatial aggregate level. The paper also relates previous empirical evidence on spatial dependence in growth studies to the externalities modeled here.     

Regional Innovation Systems and Economic Performance: Between Regions and Nations

This article aims at assessing the diversity of regional innovation systems and their economic performance in Europe. We propose to adapt the social systems of innovation and production (SSIP) framework at the regional level by identifying the specific arrangements of each part of the innovation and production system. Three key features of European regions are investigated using this framework: the diversity of regional SSIP, the interplay of regional and national determinants of such systems, and the impact of SSIP on regional performance. We identify a typology of regional configurations resulting from the combination of scientific, technological, educational and industrial indicators, using multivariate data analysis. A variance analysis approach is then developed in order to test the existence of specific regional growth regimes. The results highlight a persistently high level of diversity of regional configurations, notably among knowledge intensive regions, but also show that national institutional settings remain of fundamental importance in shaping a number of regional configurations. A final conclusion relates to the weak correlation observed between the structural characteristics of regions and their performance over the 2003–2007 period: regional performance remains primarily shaped by national trends. Overall, the paper questions the regional dimension of these “systems”.     

The Territorial Impact of the Knowledge Economy: Intangibles and Regional Inequality in Great Britain

Knowledge-based activities are an important source of national and regional competitiveness. In the UK and other European Union countries knowledge industries represent not only one of the fastest growing sources of new jobs, but also account for an increasing share of Gross Value Added (GVA) and exports. Nonetheless, there are also indications that the actual importance of the knowledge economy still remains understated. Within the conventional System of National Accounts, expenditure on intangible assets, such as research and development or human and organizational capital, is not considered either as part of GVA or as investment. In the UK, Marrano et al. (2009 Marrano, M. G., Haskel, J. &; Wallis, G. (2009) What happened to the knowledge economy? ICT, intangible investment and Britain's productivity record revisited, The Review of Income and Wealth, 55(3), 686–716. doi: 10.1111/j.1475-4991.2009.00344.x[Crossref], [Web of Science ®] , [Google Scholar]) report increased market sector GVA figures by as much as 13% in 2004 after treating intangibles as investment. Considering that expenditures on intangibles vary considerably across regions, it is likely that the territorial impact of this aspect of the knowledge economy has remained largely unreported so far. Spatial inequalities in the investment in intangibles should result in sharper inequalities in regional output. This paper aims to address this issue, first by adjusting the UK regional GVA series for investment in intangibles and second by exploring the trends in regional economic convergence during the period 1991–2004.     

Globalization,Modes of Innovation and Regional Knowledge Diffusion Infrastructures

Firms increasingly transcend the boundaries of regional innovation systems in their search for technology and complementary capabilities, and only rarely can they build their knowledge bases on science system output alone. Whereas the former decouple firms from regional user–producer networks, the latter raises important questions concerning the role of local science and education system actors in industrial development. By applying the “modes of innovation” concept on a Norwegian region, this paper discusses how science and education institutions can respond to the challenges of knowledge base complexity and globalization. It concludes that such institutions may play a vital role in supporting knowledge-based development, albeit different from that of academic knowledge exploration followed by linear technology transfer to industry.     

Measuring the Economic,Social and Environmental Performance of European Island Regions: Emerging Issues for European and Regional Policy

Islands in the European Union (EU) are very diverse, with many small or very small islands and are recognized as territories facing particular development challenges. In this study, we seek to compare the state and the attractiveness of island administration units in their national and EU context and highlight their divergence in different dimensions, building on existing analysis of the European Commission and of ESPON, using more indicators than the GDP per capita. The assessment is performed with the use of five different indexes: one for the state of development, one for changes during 2000–2006 and three for the attractiveness of islands (direct effects of insularity to attractiveness, indirect effects and natural and cultural potential of islands). Findings for economy demonstrate that islands with better economic performance either specialize in a low added value activity (tourism), or have their GDP “boosted” by exogenous influences (duty free area, oil extraction or the public sector). For attractiveness, most of the islands perform very low and the situation of small islands and archipelagos is worse. Since insularity can be considered as a permanent, natural feature affecting negatively, directly and indirectly, most of the factors that make islands attractive, the need for a territorial policy emerges.     

The European Union Higher Education Policy and the Stake of Regionalization

This paper attempts to explore the underlying nature and terms of Higher Education policy. Higher Education policy cannot be viewed outside the changing conditions of the state especially when the inquiry centres on Europe. In the European context, policy making, in order to be efficient, seems to be conducted on two levels, the supranational and the regional. This change in the structure of Higher Education policy making can be considered as an outcome of globalization and the current market economy. The EU's Higher Education policy may be expected to go beyond the national into the supranational level of cooperation with the launching of new initiatives resulting from the Bologna Process and the European Higher Education Area. These initiatives are reshaping the role and responsibilities of Higher Education Institutes towards society and the market. The new role that these institutes are called upon to play indicates a clear tendency towards dissemination and the growing need for cooperation at the regional level.     

Urbanization and Socioeconomic Status in the European Regions: The Role of Population Ageing and Capital City Regions

Using the European Community Household Panel data survey and confirmatory factor analysis, this paper explores the causal relationship between the multidimensional concepts of urbanization and socioeconomic status in the European Union. It shows that income, education and occupation are strongly related to status, and the density of population area and the town size, to urbanization. The relationship between urbanization and status is positive. This means that urban areas contain the residences of the elite, such as the rich, those with high levels of educational attainment and people with high-calibre jobs. This paper does not provide evidence to support the idea that individuals lose socioeconomic status as they age and that status is higher in capital city regions. The relationship between urbanization and status is relatively stronger for the old working-age cohort and for the non-capital city regions. These results have policy implications with regard to social welfare and urban and regional planning and development.     

Change in the Innovation Process: New Knowledge Production and Competitive Cities--The Case of Stuttgart

The global integration of economic activities is bringing with it major changes in innovation processes. New kinds of innovation, such as service and organizational innovations, became increasingly important in the 1990s. The shift to new forms of knowledge creation reflects the emerging knowledge based economy. This has effects on the existing comparative advantages of metropolitan innovation systems and is a major challenge to the ability of cities to adjust, especially those in mature industrial sectors whose competitiveness is based on innovations in industrial technology and scientific and technological knowledge production. Stuttgart is one of these cities. Much of the comparative innovative strength of the Stuttgart region derives from the generation of synergy effects of its technological and institutional development paths. The high levels of industrial exports and the competitiveness of the global players in the Stuttgart region indicates how advantageous the technology based knowledge production and diffusion in the region has been for the innovativeness of the core industrial branches. The crisis at the start of the 1990s showed that the economic success of particular firms does not mean that the metropolitan region as a whole is innovative and competitive. The institutional structures used to establish and maintain the comparative innovative advantages of the industrial sector have hindered adjustment to new forms of knowledge production and diffusion. The paper examines the adjustment processes in the Stuttgart region which are changing the organization of innovation and learning in a way that makes it receptive to new forms of knowledge production and diffusion.     

The Impact of Innovations on Growth and Stagnation Regions in Poland

The goal of this article is to identify the impact of innovations on growth and stagnation regions in Poland. The research procedure consists of two stages. At stage one, Polish administrative units (voivodeships) were arranged on a scale of economically robust and weak regions following data clustering, indicators organized in line with the following aspects of social and economic growth: (1) population and settlement, (2) the economy structure and the labour market, (3) the technical infrastructure and spatial accessibility and (4) the financial situation and level of affluence. Stage two includes identification of the relation between the regional diversification and the distribution of growth and stagnation regions in Poland which is based on canonical correlation.     

Multinational Knowledge Strategies,Policy and the Upgrading Process of Regions: Revisiting the Automotive Industry in Ostrava and Shanghai

This paper revisits how and why new multinational knowledge-based strategies and multi-level governmental policies influence the upgrading process of regions in developing economies. Automotive multinationals traditionally exploited local asset conditions, but it is shown that they have also been contributing to knowledge-generation systems via investments in R&D centres and cooperation with regional knowledge producers. We discern three elements of the upgrading process of regions—upgrading of domestic firms, subsidiary evolution and establishment of strategic relations with local knowledge institutes—to analyse two case studies: Ostrava (Czech Republic) and Shanghai (China). The cases show that all types of upgrading—product, process, chain and functional—have taken place in the last years, and that follow sourcing may have a positive impact on regional upgrading. These observations provide lessons for governments in developing economies which aim to strengthen innovation-based regional development.     

The Economic Performance of European Cities and City Regions: Myths and Realities

The ever-increasing concentration of people and economic growth in the largest cities relative to the rest of the country has slowed down or even reversed in many of the developed European countries over the last decade. This trend contradicts what the global cities, urban economics and new economic geography literature would predict. This trend can be interpreted from two points of view: (1) the trend is due to large obstacles to further large city urbanization and thus is inefficient or (2) this trend highlights alternative pathways to growth than the mega-city approach and may be as, if not more, efficient. This trend may be linked to Europe's uniquely polycentric urban structure with high number of small- and medium-sized cities. In addition, improvements in the access to services, including broadband, outside large cities may have facilitated the higher growth rates of smaller centres and rural regions and increased their appeal for residents and firms. Last but not least, negative externalities in the large cities, such as congestion costs, pollution, labour crowding and high cost of living, may increase the appeal of smaller centres and rural regions.     

The Lost Intermediaries: The Impact of 1870 on the European System

Abstract

Among the colourful characters that populate eighteenth-century military history, the French-born comte de Bonneval (1675–1747) has been kept alive in historical memory longer than most. His surprising conversion to Islam and contribution to Ottoman military reform long made him a popular subject for biography in his own right. Nowadays, he mainly features in biographies of Prince Eugene of Savoy. Both were commanders in the Habsburg army, and for nineteen years they were close companions in war and peace.¹ The circumstances that turned Bonneval's friendship with Eugene to enmity also led him in 1729 to offer his services to the Ottoman Empire. For most scholars, this is the moment when his actions became of lasting historical significance. The Ottomans, who suffered in the eighteenth century a series of military defeats, employed foreigners to help them reform their army. After converting to Islam and renaming himself Ahmed Pasha, Bonneval became the first of these when the grand vizier, Topal Osman, invited him in 1731 to reform the Ottoman artillery corps. He moved to Constantinople, added the sobriquet ‘Humbaracl’ (bombardier), and became a noted figure at the court of Sultan Mahmud I. Until Bonneval's death in 1747, Europeans having dealings with the Ottoman regime looked to him for assistance in navigating its internal politics.²     

The Dynamics of Regional Invention and Innovation: Innovative Capacity and Regional Change in the Twentieth Century

The twentieth century dynamics of United States regional invention trends are explored in this study. Historically, regions that become major loci of invention have always gained much influence, through innovation diffusion, their human capital infrastructures, and their national economic and political projection. The United States has experienced a remarkable inversion of regional roles on invention since the middle of the twentieth century, where the predominant position of heartland regions (the Northeast and the Midwest) is being overturned. This analysis develops a macro-level measure of inventive output, innovative capacity, to evaluate changes in regional inventive performance and the potential for innovation. The analysis of patent age cycles provides insights on the temporal structure of the national and regional innovative capacity, and on the dynamics of crisis periods for U.S. scientific and technological invention. A consideration of regional income trends over the twentieth century and of innovative capacity performance shows the potential importance of endogenously generated inventions for regional development.     

Regional Wage Rigidity: The European Union and United States Compared

In recent years it has been pointed out that regional unemployment disparities are much more entrenched across member states of the European Union (E.U.) than they are in the U.S. A 'conventional wisdom' has emerged to the effect that this difference is due in part to the greater degree of wage rigidity in E.U. regions. In this paper we explore this issue by estimating short run and long run real wage (in)flexibility for the regions in five core E.U. countries (Germany, France, Italy, the United Kingdom, and the Netherlands) and for the U.S. states for the period 1976–1994. We find that real wage (in)flexibility varies across regions both in the E.U. and the U.S., but that, on average, regional wages are no less flexible in E.U. core regions than in U.S. states. The paper also examines some of the possible correlates ofregional variations in wage (in)flexibility.     

Regional Scientific Production and Specialization in Europe: The Role of HERD

This paper analyses the effects of R&D expenditure in the higher education sector on the scientific production across regions in Europe 15. Our research questions relate to the regional production of science and the role of academic R&D expenditures on regional scientific output. The results show that money affects the production of scientific results in regions. On average, we found different impacts and lags of R&D expenditure according to the level of regional development. Our findings also suggest that scientific specialization is a significant factor affecting scientific outputs, although its effects differ across disciplines and regions.     

Global Strategies Compared: Firms,Markets and Regions

This paper explores the disembedding effects of globalization upon regional social ties as proposed in the relevant literature. It then asks questions about the limitations of such disembedding in relation to the prospects for new social movements. The analysis proposed offers an understanding of globalization as a societal, historical process. It shows that firms adopt diverse and distinctive strategies for going global which structure the overall process in question. These developments have organizational and spatial-regional effects which create tensions in the globlization process.     

Balancing Competitiveness and Cohesion in Regional Innovation Policy: The Case of Finland

This article sheds light on the relationship and tension between competitiveness and cohesion as undercurrents and continuous causes of controversies in the regional innovation policy. The in-built problems in regional innovation policy that emerge because this policy is essentially a synthesis of different policies with different rationales are contemplated. Empirically, this article outlines the main phases of evolution and drivers of development in the Finnish regional innovation policy. It also discusses the recent developments from the perspective of regional (and national) competitiveness and cohesion nexus. These empirical outlines are then used to feed the views back into the discussion on a more theoretical level.