Regional Technology Initiatives: Some Insights from the English Regions

The paper presents findings from recent research on the policy role and experience of a number of Regional Technology Initiatives (RTIs) aimed at supporting innovation and technology transfer, particularly in small- and medium-sized enterprises (SMEs), in the English regions. The findings are discussed in relation to recent theoretical debates around innovation processes within SMEs, regional innovation systems and learning/actor networks. A primary concern is to understand the factors shaping the evolution of such initiatives and the lessons to be learnt from the experience to date. In this respect discussion focuses on four key issues: the funding driven nature of most of the initiatives; the move away from simply making new technology more accessible to a more client-need centred approach; the structural and cultural obstacles to improved links between academia and SMEs and how some of these can be ameliorated; and the issue of strategic integration between business support agencies within a region to support longer term economic development agendas. The paper concludes that the long-term viability of the RTIs will be dependent on their continuing capacity to anticipate and respond to an evolving, and to some extent uncertain, regional policy context.     

Regional Innovation Support Systems: Recent Trends in Germany and East Asia

Since the beginning of the 1990s, one can observe a clear shift in the aims of regional policy in industrialized countries from reducing regional inequalities to developing endogenous small and medium-sized enterprises (SMEs) and innovation in regions through regional innovation support systems. Innovation support systems are defined as a group of actively cooperating organizations that support the innovativeness of SMEs. An innovation support system consists of all agencies found in three support stages, namely the provision of general information, technological advice and joint R&D projects, between firms (of which technology-following SMEs are the main group), higher education institutes (HEIs) and public research establishments (PREs). Agencies found in these stages try to help to solve innovation problems mainly of technology-following SMEs by either giving them advice themselves or by referring them to other agencies in a further stage of support. The agencies can be mainly supra-nationally, nationally or regionally initiated. This paper aims at comparing these regional innovation support systems in Germany and East Asia, that is Japan and South Korea, both concerning the instruments used, their impact on regional economic development, their level of organizational embeddedness in regions and the ability of regions to coordinate innovation support policies. The main conclusions of the paper are that there are similarities between the regional innovation support systems found in the countries when it comes to policy instruments, but that the countries differ concerning their level of regional embeddedness and the abilities of regions to coordinate innovation support policies. The paper also tentatively concludes that in countries where regions have the ability to coordinate policies into integrative innovation support systems, the impact on regional economic development tend to be larger than in countries where these abilities are lacking, that is where dirigiste and grassroots support systems prevail. One important explanation for the different coordinating abilities lies in the different political-administrative systems found in the studied countries (centralized in South Korea versus federal in Germany). Other factors explaining differences are: a time lag of development policies between countries, differences between the history of supporting SMEs in regions, supra-national support frameworks, the commitment of the political leaders in regions, collective trust and the size of countries.     

Policy Support for the Diffusion of Innovation among SMEs: An Evaluation Study in the Spanish Region of Madrid

Innovation is increasingly supported by public authority action focused on regions and small and medium enterprises (SMEs). In this line, the region of Madrid launched a programme to create Technology Diffusion Centres (TDCs) in order to promote innovation culture among the SMEs of the region. This article analyses the nature of innovation activities in these firms, and the achievements of the TDCs through their work with them. Different types of TDCs are compared according to the approach they applied and the agent to which they were linked. Ten indicators were used to examine the degree of embeddedness and performance of the different TDCs among the SMEs. Results show that a sectoral approach in conjunction with links to business association is the best option for the TDCs in urban and industrial areas. However, in the peripheral or less favourable areas, such as rural ones, a territorial approach in conjunction with links to local entities is the most effective alternative.     

Complementarities Between Universities and Technology Institutes: New Empirical Lessons and Perspectives

This paper investigates the different roles played by universities and technology institutes (TIs) as innovation partners of firms. Comparing the characteristics of Spanish firms collaborating with these agents allows us to better define complementarities among the target groups of these organizations. Our findings show that those firms collaborating with universities are bigger, have higher internal capabilities and are less dependent on their external relationships while firms collaborating with TIs are smaller, have weaker internal capabilities but are more open to their environment and thus more reliant on external sources. We point to the implications of these findings for regional development. Universities have a role as partners of more technologically advanced firms. TIs, on the other hand, partner those firms, which though also quite advanced, require more external help in their innovation processes. These results should help policy-makers in the definition of more complex regional strategies and the provision of tools aimed at different goals. Managers of universities, TIs and client firms should find these results of help in developing more positive collaborations with one another.     

产业联系与外资溢出效应-对浙江省制造业的实证研究

本文探讨水平联系、前向联系和后向联系对外商直接投资溢出效应的影响。利用浙江省制造业数据,通过实证分析发现,浙江省制造业外资总体上具有水平负向溢出效应,同时通过后向联系产生正向溢出效应。水平负向溢出效应主要是外资企业带来的激烈竞争所导致的,产业后向联系产生的正向溢出效应主要通过外资企业的本地采购发生。浙江省内资制造业企业并没有从购买外资企业中间投入品而显著提升效率。     

Using Technology Absorption as an Evaluation Criterion: Case Studies from a State Research and Development Program

State agencies sponsoring local research and development projects often finance the development of technologies in partnership with other organizations. These contracting partners develop and demonstrate the new technology. This study distinguishes between two types of outcomes from such projects. Technology absorption is the adoption of a technology by an organization participating in the project. Technology transfer is the process by which outcomes are adopted by organizations outside the project (i.e., nonparticipants). From an evaluation perspective, research and development projects that result in the absorption of technology, without any subsequent transfer, are difficult to assess. Often these outcomes are counted the same as a transfer even though the process is subsidized by the state.
Three case studies of absorption outcomes are presented. Absorption projects tend to be distinctive because: (a) they develop technologies that are very large in scale and very complex; (b) project leadership typically is provided by an end-user who attempts to employ the technology for commercial purposes; (c) success is measured through the technological accomplishment and ongoing commercial venture rather than by the number of adopting organizations; and (d) they produce spillover benefits in the cohesion of the social networks formed among project participants.     

Small is not Necessarily Beautiful: An Evaluation of Policy Support for Small and Medium-sized Enterprises in Australia

One of the key strategies of the current Commonwealth government in Australia is to promote a dynamic entrepreneurial culture by improving the business environment for small and medium-sized enterprises (SMEs). This paper evaluates the contribution of SMEs to innovation and employment in Australia and reviews the international evidence on the value of SMEs. It concludes that a very small percentage of SMEs are responsible for most of the employment generation and innovation in the small-firm sector. The policy implication is that general deregulatory measures designed to support SMEs as a generic class are likely to create an environment within which low-quality, low-wage employment is generated in SMEs with little future. Instead, the sectoral composition of industrial activity and the social structures and relationships within which firms are embedded require greater policy attention.     

Multinational Corporations and Patterns of Local Knowledge Transfer in Costa Rican High‐Tech Industries

Over recent decades, governments in industrializing countries have promoted policies to attract foreign investors, anticipating the benefits of technology transfer to host economies. During the 1990s, Costa Rica adopted an industrialization strategy based on attracting high‐tech multinational companies (MNCs). Using an original survey of a sample of high‐tech MNC subsidiaries, this article shows that the new wave of efficiency‐seeking subsidiaries tend not to transfer knowledge to domestic firms even when they establish backward linkages with them. Instead, most of the knowledge transfer occurs between high‐tech foreign subsidiaries. This has clear policy implications for host country governments.     

少数民族地区旅游发展的战略联盟与网络构建——以广东连南瑶族自治县为例

本文根据战略联盟和战略网络理论,以广东连南瑶族自治县为例,探讨了少数民族地区旅游发展的战略联盟与网络构建。文章认为连南县旅游发展战略联盟应考虑旅游的前竞争联盟、后竞争联盟和竞争性联盟,在此基础上,构建连南县的旅游战略网络。     

BUSINESS AND THE NORDIC WELFARE STATES, 1890-1970

Social scientists have, since the 1990s, shown an increasing interest in the role of business actors in welfare state development, and these debates provide many opportunities for historians of the Nordic countries to contribute with their insights and findings. This special issue brings together six historical studies on the role of business in the development of the welfare states in the Nordic countries, including the role of firms as providers of company welfare as well as the activities of firms and of business interest groups to influence policies and public opinion. Two observations stand out. First, the contributions draw a picture of a gradual shift in this period from that of fundamental opposition, which often dominated up to the mid-20th century, to a more pragmatic approach of cooperation. Cooperation in policy-making co-existed with confrontation in public debate, in which business interest groups promoted alternatives to ‘big government’. Second, these studies underline the value of paying attention to what Reinhart Koselleck called ‘horizons of expectations’. These historical studies show how the vocabulary of the actors changed in this period, and how business interest groups not only influenced political decisions but also adapted their expectations to changes in the political context.     

Do industrial districts influence export performance and export intensity? Evidence for Spanish SMEs' internationalization process

This paper seeks to enhance the understanding of the role of the industrial districts in the internationalization process of small and medium-sized enterprises (SMEs). The study focuses essentially upon the following issue: Can the location inside industrial districts influence the export performance and export intensity of the Spanish SMEs? To address this question, this study draws upon a sample of 285 manufacturing firms located in the Valencian community (a Spanish region) surveyed during the period January 2000 to March 2000. It is shown that industrial district location, marketing differentiation, institutional networks, clients' networks, competitors' networks and global orientation of sector and company have a clear influence on firms export performance and export intensity. The results are basically consistent with the limited previous research.     

Transnational corporations and the geographical transfer of localised technology: a multi-industry study of foreign affiliates in Sweden

Based on unique firm-level data from 323 majority-owned foreignaffiliates (MOFAs) located in West Sweden in the beginning of2000, we show that foreign-located affiliates of transnationalcorporations (TNCs) generate technological competencies, bothinternally as well as through organised cooperation with externalbusiness partners in the host country. This seems true not onlyfor manufacturing affiliates, but also for wholesale affiliatessupplying industrial products, as well as professional serviceaffiliates providing technical services. In addition, all threecategories of affiliates are engaged in ‘dynamic technologicalintegration’, i.e. a geographical transfer to parent andsister firms of technological competence that MOFAs have developedin cooperation with external business partners in Sweden. Thisindicates that not only the technological competence of MOFAsthemselves, but even the geographical context in which theyare embedded is a relational asset that is crucial for the overalltechnological competitiveness of TNCs. Above all, technological linkages were established with hostcountry customers. Important technological linkages were establishedboth with local business partners in West Sweden, as well asbusiness partners in the Rest of Sweden. Using a logistic regression analysis, we found that technologicalintegration is especially associated with affiliates operatingin competitive host country clusters, indicating that a largepool of indigenous technological competence acts as an importantpull-factor for inward asset-seeking FDI. However, technologicallinkages between foreign TNCs and host country partners doesnot come automatically, instead they need substantial and long-terminvestments in personal and non-personal resources.     

What Makes SMEs more Likely to Collaborate? Analysing the Role of Regional Innovation Policy

The last 20 years have witnessed the diffusion of regional innovation policies supporting networks of innovators. The underlying aim of these policies is to encourage firms, particularly small and medium-sized enterprises (SMEs), to undertake collaborations with organizations possessing complementary knowledge. Focusing on a set of SMEs that have participated, over time, in several innovation networks funded by the same regional government, the paper investigates how their relationships have evolved with respect to the following aspects: (i) reiteration of pre-existing relationships as opposed to experimentation with new relationships; (ii) collaboration with organizations possessing complementary rather than similar knowledge and competencies; (iii) creation of local relationships rather than experimentation with extra-local collaborations; (iv) reliance upon intermediaries to connect with other organizations. Our findings reveal that the involvement in these policy-supported networks changed the firms' relational patterns, leading them to collaborate with a wider variety of agents than those with whom they were linked before the policies. Sectoral heterogeneity had a negative effect on the probability of collaborating, while co-localization increased the likelihood of collaborating. Mutual involvement with intermediaries also had a positive effect. However, in the case of firm-to-university relationships only specialized intermediaries were likely to perform a positive role and, therefore, encourage networking.     

A THEORETICAL FRAMEWORK FOR SMALL BUSINESS POLICY

A number of public policy issues have been discussed in this article, the most important of which are: 1. Small business would not need special consideration if our economy were basically a competitive one. 2. A large and growing segment of our economy has sufficient market and political power to make our economy basically non-competitive. 3. Small firms tend to provide price competition, to lead in the development of new products and processes, and to generate new innovations and new employment. 4. Government policy tends to create artificial economies of scale, giving an unwarranted advantage to the very large firm. As a first approximation, a policy of government neutrality on firms of varying size is needed. But, because of discriminations which already exist which favor large firms over small firms, special small business programs may be necessary to provide an equitable policy base. Unfortunately, programs designed to benefit all business, like the investment tax credit, tend to primarily benefit larger firms (Berney, 1979). This is the case for two reasons. First, there is a basic difference in production relationships: large firms tend to be more capital intensive and small firms more labor intensive. Second, the more complex a rule or regulation, the more costly it is for small business to use it. Consequently, even the employment tax credit, which should benefit the small firm is not used by them. Instead, it tends more to benefit the larger firm. Neutrality, as a governmental policy, would appear to demand different treatment for firms of varying size. As an example, the “regulatory flexibility” concept applies different standards to different sized firms so that the burden of regulation is more equitably distributed. The concept of encouraging or requiring financial institutions and other lenders to establish “dual prime rates” is a further example. Since small firms appear to have much higher debt to equity ratios and rely more heavily on shorter-term bank credit, they are more heavily burdened by a tight money policy which forces increases of interest rates. Thus, dual prime rates help to spread the burden of rising interest costs more equally. As many people prefer to work for themselves, equalizing the burden of government policy could only serve to increase the basic growth rate for small business, thus providing an easier start for entrepreneurs and would encourage a more rapid rate of economic growth. None of these discussions, however, argues that small business should be protected from failure. The more efficient firms will succeed and prosper, and the least efficient will not. Many currently successful entrepreneurs learn how to improve their production processes or managerial skills from their failures. What is being recommended as a first step is that government should concentrate on equalizing burdens and benefits in order to achieve true neutrality. If private economies of scale do indeed exist, new firms must grow to survive; what the government should not create are artificial economies of scale with public policy. A strong argument for further action can also be made: it appears that significant external benefits are produced by an economic system with a dynamic small business sector. Since these benefits go to society as a whole rather than entrepreneurs alone in the form of increased profits, a freely operating market without government assistance does not generate as many new small businesses as would be optimal for our society. To internalize the benefits that come from small business, governmental programs need to be devised to increase the rate of return on new, innovative small businesses. Should this happen, we could then anticipate increased rapid rates of innovation and technological change, more rapid rates of employment growth, expanded price competition in all sectors of the economy, and improved export capabilities, in short, true flexibility in our capitalistic system.     

Technology Transfer between Technology Centres and SMEs: Evidence from the Basque Country

Public policies (often at the regional level) favouring pre-competitive research and cooperative research and development have played a decisive role in the development of technology centres in Europe and all over the world. The technology offer model gave priority to the creation of technology transfer organizations and structures, but there is increasing evidence that this model did not attach enough attention to the needs of small- and medium-sized companies (SMEs) and in particular, to their capacity to take in knowledge. In this paper, based on qualitative research, we show in detail some of the main issues involved in the relationships between technology centres and SMEs in the Basque Country, a region that has developed intensive policies favouring technology transfer organizations over the years.     

Networking and learning for tourism innovation: evidence from the Western Cape

ABSTRACT

This paper examines the nature of networking and learning by tourism firms in relation to accessing knowledge for innovation. In particular, the nature of tourism learning and networking, geography of networking linkages, and systemic characteristics of relationships between tourism firms, government agencies, higher education institutions, and other organisations in the Western Cape tourism system are examined. The analysis draws on 182 tourism firm, tourism system, and contextual interviews. This investigation demonstrates that even though tourism firms mostly use internal resources for innovation, external, non-local knowledge is significant for enhancing novel innovation. It is disclosed that whilst local network linkages are dense, loose, and of importance for business and marketing purposes, extra-regional network relationships are imperative for learning in relation to innovation. As further observed, network linkages between local and regional actors for supporting tourism innovation in the Western Cape are generally weak which points to the underdevelopment of local and regional innovation networks or systems. The paper provides planning recommendations for enhancing the competitiveness of tourism firms towards fostering development and growth in the regional tourism economy. Specifically, support for stimulating learning networks as well as strengthening systemic relationships in the Western Cape tourism system are recommended. It is underscored that strategic relationships with non-local partners need to be nurtured towards fostering tourism innovation and enhancing regional competitiveness.     

Innovation projects and local production networks: A case study of Hertfordshire

This paper evaluates some of the key arguments underlying what is called here the local production network paradigm (LPNP). These are presented as three interlinked hypotheses that turn on the idea that firms competing in world markets need to accommodate continuous change by fostering product or process innovation. The definition of innovation used in this study is “the commercially successful exploitation of new technologies, ideas or methods through the introduction of new products or processes, or through the improvement of existing ones” (EC DG XIII, 1996, p. 54).

One conventionally described organizational response to this requirement to accommodate continuous innovation is to dis‐integrate firms and set up local production networks. Local production networks are defined in this study as “collaborative linkages between local firms and local factors of production”. Such networks are said to rely on local resources of various kinds to enable them to innovate on a continuous and incremental basis. As a result of such dependencies on local factors, and their interconnectedness with each other, the local production network (LPN) firms then become ‘embedded’ in their localities. Such networked economies have been variously described as new industrial districts, areas of flexible specialization, and innovative milieux.

The evidence presented to test these hypotheses is based on a case study of innovative, award‐winning firms in Hertfordshire. The findings show that although these firms do compete successfully in fast‐moving international markets, they do not rely much on local production networks, as defined here, to enable them to do so. The findings call into question the general applicability of the LPNP. Questions are raised particularly with respect to innovation in the important minority of highly innovative core metropolitan regions.

Innovation is argued to be an interactive process that is both driven by a steady supply of technological advances and stimulated by different types of consumer demand. In the case of the firms interviewed in Hertfordshire, most of their innovative projects were developed by the firms working individually, and in isolation, from other local businesses using high quality, knowledge, information, human resources and venture capital. At the same time, these firms were also pulled by demands from military, health and company consumers. Only in the case of the minority of innovations that were purchased in the first instance by private final consumers were local production networks of some significance.     

Legacy databases and GIS: a discussion of the issues illustrated by a case study of archaeological site data from southeast Alberta,Canada

Many institutions and agencies are currently faced with the issue of geographic information systems‐enabling legacy databases. The problems can be acute for data sets that have been compiled through many years, using different standards and levels of recording. To explore these issues further, we report on a data quality assessment undertaken in 2002 for a subset of the archaeological site database of the province of Alberta, Canada. Our work shows that positional ambiguities in the data set can be highlighted and corrected by relatively straightforward procedures. This case study also provides an indication of the amount of work effort that will be involved in validating or ‘cleaning up’ data sets so model results and analyses undertaken with them are more reliable.     

The Role of Location and Regional Networks for Biotechnology Firms in Israel

This article presents results of a study of the Israeli biotechnology sector. The findings of the study show that despite the small geographical size of the country, the Israeli biotechnology industry tends to a great extent to cluster around leading research institutes. Based on a survey of 109 high-tech projects, the study suggests that the relatively weak business background of the entrepreneurs, the fact that most of them have worked at research institutes and that most new biotechnology firms were originated from ideas that came out of universities or research institutes, can provide possible explanations for this geographical concentration. The research emphasizes the relative importance biotechnology entrepreneurs ascribe to networking, both in very early stages as well as in advanced stages of the firm development process. It is argued that although the focus of the network changes over time, both geographically and in content, its links to local research partners are maintained. It is suggested that earmarked regional support policies are crucial to the development of networks required by new biotechnology firms.     

Asian Transnational Enterprises and Technology Transfer in Thailand

Like many of its neighbours, Thailand is increasingly interested in upgrading the technological capability of its indigenous firms through the inward investment (foreign direct investment, FDI) of transnational enterprises (TNEs). Its science and technology policies, however, remain fragmented, and they compete with regional distribution priorities. This paper examines the nature of technology transfer between Asian TNEs (Japan and the newly industrializing economies (NIEs), that is, the NIEs of Hong Kong, Singapore, South Korea and Taiwan) and Thai firms based on the responses of some 145 firms from a 2005 survey. It finds only modest levels of technological transfer in production and process technologies. Asian TNEs evaluate factor cost advantages and government incentives favourably. Logistic regressions, however, indicate that government incentives are negatively related to technology process modification between NIE subsidiaries and Thai customers. But, the technical training of Thai workers significantly increases the likelihood of Asian subsidiaries undertaking process technology transfers. Among NIE firms, the ability to import foreign skilled labour further increases the likelihood of such technological activities. Finally, forward linkages among the NIEs are positively associated with firm location in the urban agglomerations of Bangkok and Chon Buri, and, among smaller firms. Our study suggests that prevailing FDI policies have little influence on technology transfer, while technology policies that favour large TNEs work against smaller NIEs that are engaged in modest technology transfer.