This monthly selection of articles has been carried out by Philippe Gugler and Damiano Lepori, the Center for Competitiveness, University of Fribourg. The entire selection, carried out since 2013, can be consulted on the academic articles page of our web.

Evolution of ICT and software industry: Crisis, resilience and the role of emerging clusters

By : M. B. Baypinar. ERSA conference papers from European Regional Science Association, 2016.

Abstract : “The ICT and software industry have evolved as twin global industries now spanning a large number of interconnected clusters in the developed and emerging countries. Firms, governments and other actors have re-established different relationships and structures throughout 1980-1984, early 1990s, 2000-2001 and 2007-2008 crises, often resulting in decline of older clusters and emergence or solidification of newer ones. Studies indicate that a cluster’s evolution, its position in the technological life-cycle, and dominancy are quite relevant with resilience of the cluster. On the other hand, region-specific factors seem to be important for specialization of ICT-software clusters, which, may work or against their benefit due to strategic geographic responses of larger actors in the industry, such as promotion of offshore outsourcing or onshore in-house activities. There is increasing evidence that these factors are recently used better by regional and national governments against clusters in more advanced regions, particularly by strategic use of timely legal reforms, state-sponsored large ICT-software projects and attempts to grow local ICT-software markets. Yet, the knowledge externalities created by these efforts are captured not only by large MNCs, but also by an increasing number of local companies, which are increasingly transforming into multi-national actors. This paper tries to evaluate how governments, local companies and MNCs establish strategic collaborations and promote growth of clusters in emerging country context, in the case of ICT-software industries. The study relies on secondary data resources and the literature in evaluating emerging country contexts, but also makes use of primary data, local and national strategic planning documents and interview interpretations in the context of Turkey’s clusters. The study’s main contribution lies in demonstrating how mixed core/periphery features, collaboration of local/national actors with global actors, and emerging new technologies play a role in the emergence of new forms and functional structures at industry level.” [ABSTRACT FROM AUTHOR]

Future green economies and regional development: a research agenda

By: D. Gibbs, K. O’Neill. Regional Studies, Vol 51, N. 1, 2017.

Abstract : “The past 30 years have seen an explosion of interest and concern over the detrimental impacts of economic and industrial development. Despite this, the environmental agenda has not featured substantially in the regional studies literature. This paper explores a range of options for regional futures from a ‘clean-tech’ economy and the promise of renewed accumulation through to more radical degrowth concepts focused on altering existing modes of production and consumption, ecological sustainability and social justice. In so doing, it investigates the potential role of regions as drivers of the new green economy, drawing on research into sustainability transitions.” [ABSTRACT FROM AUTHORS]

Cluster activities in different institutional environments. Case studies of ICT-Clusters from Austria, Germany, Ukraine and Serbia

By : A. Konstantynova, T. Lehmann. ERSA conference papers from European Regional Science Association, 2016.

Abstract : “In recent decades industrial clusters and agglomerations were recognized as drivers of regional and often national economic growth and competitiveness. Based on this cluster policy has been widely used to spur economic change, especially on the sub-national level. The public support to cluster development was widely done following the observed examples in the United States aiming to follow their success stories. Most commonly applied cluster policy approach composed of cluster mapping, establishment of institutions (labelled as cluster initiative/ association) in respective clusters through public-private support of these institutions´ and companies´ activities. However, the implementation of blue-printed cluster policy did not always lead to positive paths of cluster development due to the negligence of country / region specific institutional frameworks. This paper fills this void, by exploring selected cases of cluster associations and how their activities are influenced by different sets of institutional framework conditions. Information and communication technologies (ICT) clusters and their associations in European Union (EU) and Non-EU countries are taken as cases for the analysis.” [ABSTRACT FROM AUTHORS]

The city as innovation machine

By : R. Florida, P. Adler, C. Mellander. Regional Studies, Vol. 51, N. 1, 2017.

Abstract : “This paper puts cities and urban regions at the very centre of the processes of innovation and entrepreneurship. It combines the insights of Jane Jacobs and recent urban research on the role of the city with the literature on innovation and entrepreneurship going back to Joseph Schumpeter. Innovation and entrepreneurship and their geography privileges the firm, industry clusters and/or the individual and poses the city as a container for them. By marrying Jacobs’ insights on cities to those of Schumpeter on innovation, it is argued that innovation and entrepreneurship do not simply take in place in cities but in fact require them.” [ABSTRACT FROM AUTHORS]

Geographical Clustering and the Effectiveness of Public Innovation Programs

By : D. Crass, C. Rammer, B. Aschhoff. ZEW Discussion Papers, No. 16-083, 2016.

Abstract : “The paper analyzes how geographical clustering of beneficiaries might affect the effectiveness of public innovation support programs. The geographical proximity of firms operating in the same industry or field of technology is expected to facilitate innovation through knowledge spillovers and other localization advantages. Public innovation support programs may leverage these advantages by focusing on firms that operate in a cluster. We investigate this link using data from a large German program that co-funds R&D projects of SMEs in key technology areas called ‘Innovative SMEs’. We employ three alternative cluster measures which capture industry, technology and knowledge dimensions of clusters. Regardless of the measure, firms located in a geographical cluster are more likely to participate in the program. Firms being part of a knowledge-based cluster significantly increases their chance of receiving public financial support. We find no effects, however, of geographical clustering on the program’s effectiveness in terms of input or output additionality.” [ABSTRACT FROM AUTHORS]

Knowledge bases, multi-scale interaction and transformation of the Vienna medical cluster

By : F. Tödtling, T. Sinozic, A. Auer. SRE-Discussion Papers, 2016/03, WU Vienna University of Economics and Business, 2016.

Abstract: “The health sector and medical technologies are of an increasing importance in society and for regional and national economies. Much like other life sciences industries, the medical devices sector relies upon specific factors and knowledge processes that shape and support its innovation capabilities and competitiveness. Previous studies have shown that growth and innovation in this sector depend on specific local factors and conditions as well as on markets and knowledge-interdependencies at higher spatial scales. There is still a research gap on the detailed nature of these driving factors and relationships, however. In this research, we have investigated these issues for the Vienna medical devices cluster that is part of the wider life sciences sector in this region. The main aims of the study were to generate insights into how different economic, knowledge- and policy conditions, and their spatial scales, interact to support and hinder development of the medical devices industry in Vienna, and to draw policy conclusions based on these findings.” [ABSTRACT FROM AUTHORS]

Shifting horizons in local and regional development

By: A. Pike, A. Rodriguez-Pose, J. Tomaney. Regional Studies, Vol. 51, N. 1, 2017.

Abstract: “This paper aims, first, to trace the evolution of thinking about local and regional development in order to situate current debates in their sometimes neglected historical context and, second, to outline the elements of a future research agenda suited to contemporary challenges informed by the fundamental question of what kind of regional development and for whom. It shows how local and regional development has become a global challenge, but also how the approaches to it reflect shifting theories and ideologies which are mediated through particular structures of government and governance that shape diverse types of policy intervention.” [ABSTRACT FROM AUTHORS]

Agglomeration and (the Lack of) Competition

By : W. J. Brooks, J. P. Kaboski, Y. A. Li. Hong Kong University of Science and Tech, University of Notre Dame, 2016.

Abstract: “Industrial clusters are generally viewed as good for growth and develop- ment, but clusters can also enable non-competitive behavior. This paper studies the presence of non-competitive pricing in geographic industrial clusters. We develop, validate, and apply a novel identification strategy for collusive behavior. We derive the test from the solution to a partial cartel of perfectly colluding firms in an industry. Outside of a cartel, markups depend on a firm’s market share but not on the total market share of firms in the agglomeration, but in the cartel, markups are constant across firms and depend only on the overall market share of the agglomeration. Em- pirically, we validate the test using plants with a common owner, and we then test for collusion using data from Chinese manufacturing firms (1999- 2009). We find strong evidence for non-competitive pricing within a subset of industrial clusters, and we find the level of non-competitive pricing is roughly four times higher in China’s special economic zones”. [ABSTRACT FROM AUTHORS]

Innovation, Income and Regional Development: An assessment of the importance of differences in regional potentials.

By : A. P. Cornett, N. K. Sørensen. ERSA conference papers from European Regional Science Association, 2016.

Abstract: “The purpose of the current paper is to analyze the impact of regional potentials on the process of growth relative to the level of income. How are different types of regions (e.g. medium sized [city] regions, rural regions, urban regions or metropolitan and high-tech cluster regions) affected by improved performance, and to what extent can differences be explained by ex-ante difference in income? Based on data from the regional innovation scoreboard (RIS) is this issue addressed relative to the income level, previous growth performance and convergence. The first main part of the paper provides a brief overview of the empirical and conceptual background for the study based on a review of literature. In Section 3 the innovation performance is related to the process of convergence and divergence. Earlier research has shown that although convergence is present at aggregated European Union level a much more diversified picture is revealed at the disaggregated level. Here it is frequently observed that the more wealthy and central regions move away from the other regions. One of the results is that the economic crisis has reinforced not only intraregional divergence within countries but also the traditional divide between the stronger Northwest European countries and the South and East of Europe. Furthermore the innovation performance of the regions is modelled relative to the income level and the underlying influencing factors are identified. Hereby, we are able to identify strengthens and weaknesses of the innovation structure in different regions. In addition the issues of returns to scale will be considered. Finally, the paper discusses and evaluates the impact of different types of innovation performance and the level of income on the perspectives of economic growth for different types of regions. A number of scenarios a sketched for the perspectives of the regions depending on endogenous as well as external factor endowment and dynamics.” [ABSTRACT FROM AUTHORS]

Evidence on the within-industry agglomeration of R&D, production, and administrative occupations

By : B. Goldman, T. Klier, T. Waldstrum. Federal Reserve Bank of Chicago, WP 2016-20, 2016.

Abstract: “To date, most empirical studies of industrial agglomeration rely on data where observations are assigned an industry code based on classification systems such as NAICS in North America and NACE in Europe. This study combines industry data with occupation data to show that there are important differences in the spatial patterns of occupation groups within the widely used industry definitions. We focus on workers in manufacturing industries, whose occupations almost always fit into three groups: production, administrative, or R&D. We then employ two approaches to document the spatial distributions of each group within an industry. First, we calculate the distribution of employment shares across local labor markets and second, we calculate a version of the Duranton and Overman (2005) agglomeration index. Both approaches reveal appreciable differences in the spatial distribution of occupation groups within most manufacturing industries. These differences have important implications for our understanding of the sources of industrial agglomeration, the spatial agglomeration of innovation, the effectiveness of local economic development initiatives, and the spatial properties of particular industries.” [ABSTRACT FROM AUTHORS]