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.

Fostering Place-based Innovation and Internationalization – the New Turn in German Technology Policy

By: D. Dohse, D. Fornahl, J. Vehrke. European Planning Studies, Vol. 26, Iss. 6, pp. 1137-1159, 2018.

Abstract: “Since the mid-1990s German technology policy has experienced a paradigmatic shift from standard grant schemes towards a region-oriented and competition-based R&D policy. Currently, a new policy experiment, the InterClust contest, is under way, trying to simultaneously foster place-based innovation, R&D internationalization and the internationalization of innovative places. The current paper analyses the new policy, relating it to the recent literatures on heterogeneous firms and on cluster-life cycles, and presents results from a firm survey performed in 21 winner regions of InterClust. Findings show that the new funding scheme takes insights from recent theoretical developments into account and addresses important impediments to firm and cluster internationalization. Although it is too early for an overall assessment, it is argued that the long-term impact will critically depend on the inflow of heterogeneous knowledge and the strength of intra-regional mobilization effects.” [ABSTRACT FROM AUTHORS]

From Cognitive to Organizational Proximity – Insights on Resilience of Clusters from the Sport industry

By: A. Gerke, Y. Dalla Pria. 2017 EURAM conference, Jun 2017, Glasgow, United Kingdom, HAL Id: hal-01852222, sub. 2018.

Abstract: “Sport clusters can be defined as geographical concentrations of private, public, and non-profit- organizations in a denominated area with a shared interest in one or similar sports. This paper addresses the following question: how does socioeconomic proximity – linkages between organizations or individuals which go beyond spatial proximity – influence the development and properties of sport clusters? This qualitative study investigates four sport clusters in surfing and sailing. The findings indicate that there are two types of sport clusters based on different forms of socioeconomic proximity. The surfing clusters are characterized by cognitive proximity based on convergent perceptions and managerial practices. The sailing clusters are characterzed by organizational proximity based on complementarity. This article (1) discusses the resilience properties of these two types of clusters and (2) proposes a two-step model of cluster development. This research has implications for policy makers and cluster members by showing that clusters should be considered to be social constructions that go through different stages.” [ABSTRACT FROM AUTHORS]

A Tale of Two Distances: a Study of Technological Distance, Geographic Distance and Multilocation Firms

By: S. Wang, M. Zhao. Journal of Economic Geography, doi:10.1093/jeg/lby042, 2018.

Abstract: “The effects of geographic distance and technological distance on knowledge spillovers have been well acknowledged in the literature, but the two distances were mostly discussed in parallel. Taking advantage of the context of multilocation firms in technology clusters, we consider the joint role of geographic and technological distances by focusing on a salient feature of clusters: firms’ concern about knowledge appropriation. Specifically, we analyze how a firm’s choice of technological distance from local entities is affected by the competitive environment in the cluster as well as its intra-firm technological structure across clusters. Empirical findings based on the global semiconductors industry support our theory that, with stronger local competition, an innovating entity will increase its technological distance from neighbors to reduce unintended knowledge spillovers. However, the technological distance is smaller when the entity is part of a multilocation firm, has a larger technological distance from other locations within the firm and has stronger intra-firm integration across locations. We argue that these features limit knowledge spillovers and, hence, reduce firms’ reliance on technological distance as a strategy for knowledge appropriation.” [ABSTRACT FROM AUTHORS]

Guiding Investments in Place-based Development. Priority Setting in Regional Innovation Strategies

By: C. Günter. European Commission, JRC Science for Policy Report, S3 Working Paper Series no. 13/2018, 2018.

Abstract: “As the Structural Funds (ESIF) constitute a large part of the EU budget, considerable contributions to the overall EU2020 Growth Strategy are expected. In the 2014-2020 programming period, there is a strong focus on Research and Innovation (R&I) with the aim to boost ESIF impact on competitiveness and broader benefits (public and private returns) across the EU. Towards this larger aim, R&I Strategies for Smart Specialisation (RIS3) are means to concentrate investments in place-based, innovation-oriented activities, which are well positioned vis-à-vis global value chains, and also related to territorial or sectoral strategies with other regions. Recent assessments show that the concentration of investments towards this goal has not everywhere been optimally achieved, which is often traced back to the types of priorities selected. At first sight, this can be attributed to the nature of the strategy processes, the innovation actors involved, and their methodological and strategic competences. Looking deeper, especially where Managing Authorities and ESIF applicants/recipients had little former experience with R&I priority setting, weaknesses lie in understanding state-of-the-art concepts underlying R&I strategies, in applying the broad spectrum of R&I support tools, and in the ability to guide a range of R&I related interaction processes continually and competently. Against this backdrop, the report sets out to synthesise the dispersed knowledge on a range of issues relevant for the success of priority setting processes and practices in innovation policies and strategies. Outlining changing contexts, rationales and approaches of priority setting in R&I policies leads to the “new prioritisation logic” guiding RIS3 exercises. This is followed by two main lines aiming to facilitate improved priority setting: better understanding the wider innovation policy context of RIS3, and making better use of Strategic Policy Intelligence (SPI) and other support tools (including learning from private sector strategies) to structure and guide policy cycles, and to implement place-appropriate policy mixes. Evidence (case studies) on effective priority setting processes in RIS3-type exercises and policy recommendations complete the report.” [ABSTRACT FROM AUTHOR]

Spatial Persistence of Agglomeration in Software Publishing

By: G. Deltas, D. G. De Silva, R. P. McComb. Lancaster University Management School, Economics Working Paper Series No. 2018/012, 2018.

Abstract: “We estimate the effects of industrial localization on the spatial persistence of employment in the software industry, using micro-data from Texas for the 2000-2006 period. Locations with an initial concentration of software employment retain an excess number of employees, beyond that expected from job turnover and job persistence at the establishment level. This is not driven by differential establishment growth or survival, but it is due to (a) the retention by establishments in a location of jobs lost by other establishments in that location, and (b) the propensity of software establishments to enter in locations with prior software establishment presence. These findings are more consistent with labor channel effects than with human capital spillovers.” [ABSTRACT FROM AUTHORS]

The IT Revolution and the Globalization of R&D

By: L. G. Branstetter, B. M. Glennon, J. B. Jensen. National Bureau of Economic Research, NBER Working Paper No. 24707, 2018.

Abstract: “Since the 1990s, R&D has become less geographically concentrated, and has seen especially fast growth in emerging markets. One of the distinguishing features of the R&D globalization phenomenon is its concentration within the software/IT domain; the increase in foreign R&D has been largely concentrated within software and IT-intensive multinationals, and new R&D destinations are also more software and IT-intensive multinationals than traditional R&D destinations. In this paper we document three important phenomena: (1) the globalization of R&D, (2) the growing importance of software and IT to firm innovation, and (3) the rise of new R&D hubs. We argue that the shortage in software/IT-related human capital resulting from the large IT- and software-biased shift in innovation drove US MNCs abroad, and particularly drove them abroad to “new hubs” with large quantities of STEM workers who possessed IT and software skills. Our findings support the view that the globalization of US multinational R&D has reinforced the technological leadership of US-based firms in the information technology domain and that multinationals’ ability to access a global talent base could support a high rate of innovation even in the presence of the rising (human) resource cost of frontier R&D.” [ABSTRACT FROM AUTHORS]

The Multiple Roles of Demand in Regional Development: A Conceptual Analysis

By: H. Martin, R. Martin, E. Zukauskaite. Centre for Innovation, Research and Competence in the Learning Economy, Papers in Innovation Studies, Paper no. 2018/10, 2018.

Abstract: “This paper contributes to the literature on new regional industrial path development by highlighting the multiple roles that demand can play in regional development. We develop a conceptual framework relating different roles of demand to different types of new path development. Based on the literature on regional development, we differentiate among the role of demand as anonymous consumer, sophisticated buyer, active co-developer, public procurer, and norm and value setter. These roles influence different types of new path development, including path extension, path renewal and new path creation. New path development can be triggered by changing norms and values in the society (e.g. environmental concerns and the growing demand for cleaner technologies), public procurement for innovation (governments demand new products or services and thereby steer economic development) or by users modifying existing products or developing novel solutions that are not yet on the market (e.g. user innovations). In order to foster a new industrial growth path in a region, local firms need to sustain, establish and grow their market shares, focusing on the role of anonymous consumers. The various roles of demand, as well as its effect on new path development, depend on the geographical context. Changes of demand in one region might contribute to path extension, path renewal or new path creation in other regions. We argue that taking a nuanced view toward demand will add a novel dimension to the debate on new path development.” [ABSTRACT FROM AUTHORS]

The emergence of Collaborative Partnerships Between Knowledge-intensive Business Service (KIBS) and Product Companies: the Case of Bremen, Germany

By: Y. Liu, C. Lattemann, Y. Xing, D. Dorawa. Regional Studies, DOI: 10.1080/00343404.2018.1510178, 2018.

Abstract: “Regional science research is silent on how collaborative partnerships between knowledge-intensive business services (KIBS) and product companies emerge. The paper addresses this theoretical gap by examining the role played by KIBS firms and by their interactions with product companies. It proposes a typology of territorial servitization – namely knowledge gap, regulation gap and capacity gap – wherein KIBS firms respectively play the pivotal roles of knowledge brokers, intermediators and integrators in driving collaborative partnerships. By conducting qualitative case studies, this paper explores the mechanisms by which product companies located in a high-tech multi-industry cluster in Bremen, Germany, collaborate with KIBS firms in fostering regional competitiveness.” [ABSTRACT FROM AUTHORS]

Knowledge Intensive Business Services and Urban Areas: an Analysis of Localization and Productivity on Italian Data

By: V. di Giacinto, G. Micucci, A. Tosoni. Bank of Italy, Paper No. 443, 2018.

Abstract: “We analyse the geographic localization and the productivity of knowledge-intensive business services (KIBS) in Italy, using both census data and balance sheet data at the firm level. We find that KIBS are generally agglomerated in urban areas where they attain significantly higher labor productivity levels. Urban productivity advantages are found to be strongly associated with the local availability of human capital and to standard proxies of Marshall-Arrow-Romer and Jacobs agglomeration economies. Forward demand linkages and some factors impacting on the thickness of the local labour market also appear to be relevant. On the whole, the set of explanatory factors considered could explain the entire urban productivity premium estimated for Italian KIBS firms.” [ABSTRACT FROM AUTHORS]

Multilevel Policy Governance and Territorial Adaptability: Evidence from Japanese SME Innovation Programmes

By: H. Okamuro, J. Nishimura, F. Kitagawa. Regional Studies, DOI: 10.1080/00343404.2018.1500687, 2018.

Abstract: “Science, technology and innovation (STI) policies increasingly operate in a multilevel policy governance structure. This paper analyzes the variety of local authorities’ innovation support mechanisms for small and medium-sized enterprises (SMEs) in Japan, drawing on a unique data set of 241 local SME research and development (R&D) subsidy programmes at the prefecture and city/municipality levels. The variation of SME R&D subsidy programmes in terms of institutional forms and coordination practices of multilevel innovation support mechanisms is analyzed as manifestations of the complex territorial adaptability. The institutional co-evolutionary processes between different levels of governments help both vertical and horizontal coordination in a highly centralized system.” [ABSTRACT FROM AUTHORS]