When is Regional "Beautiful"?: Implications for Knowledge Flows, Entrepreneurship and Innovation

155 Pages·2011·3.82 MB·English

by  Bjorn Asheim

“ ”
When is Regional Beautiful ?
This book focuses on the importance of geography and space in explaining knowledge
flows, entrepreneurship and innovation. During the last few decades spatial perspec-
tives have enjoyed agrowing attention outside the specific discipline of geography both
in academic economics and among practitioners of policy and planning. This book
constitutes a selection of empirical contributions based on data from Canada, the
Netherlands,Sweden,SwitzerlandandtheUnitedKingdom. Thestudiesaddressissues
ofthe characteristicsofintra-vs.interregionalknowledge flows(WeteringsandPonds),
the re-structural process when a large pharmaceutical (Pharmacia) closes activities
(Dahlgren and Valentin), the different structure of university-industry relationships in
three countries with differential types of universities (Broström, McKelvey and Sand-
ström), the locational organization of knowledge-intensive business services (KIBS) in
a metropolitan region (Shearmur and Doloreux), the background of individuals in
KIBS start-ups (Andersson and Hellerstedt) and give a critical scrutiny of attempts to
create Regional Innovation Systems (Nuur, Gustavsson and Laestadius).
The contributions thus address relevant contemporary issues regarding the structure
of the service economy, the role of academia, and renewal of industries. They provide
valuable information, useful to policy-makers, planners and academics.
Bjørn T. Asheim is Professor and chair in economic geography at the Department of
HumanGeography,andDeputyDirectoratCIRCLE(CentreforInnovation,Research
and Competence in the Learning Economy), at Lund University, Lund, Sweden. He is
an internationally well-known researcher within economic geography and regional
innovation studies.
Olof Ejermo is Associate professor in Innovation Economics at CIRCLE, Lund Uni-
versity, Sweden. In his research he focuses mainly on assessing the entrepreneurial and
innovative capacity of the Swedish economy. He has published several articles in
internationally renowned journals and edited books.
Annika Rickne is Reader and Associate Professor at CIRCLE, Lund University and
currently active at Innovation and Entrepreneurship, Gothenburg University. Her
broad interest is economic growth initiated by new scientific or technological knowl-
edge, creating opportunities that reshape existing knowledge fields and industries or
giving rise to newones.
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“ ”
When is Regional Beautiful ?
Implications for Knowledge Flows,
Entrepreneurship and Innovation
Edited by
Bjørn T. Asheim, Olof Ejermo and
Annika Rickne
RO Routledge
U
TLED Taylor & Francis Group
G
E
LONDON AND NEW YORK
Firstpublished2011
byRoutledge
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SimultaneouslypublishedintheUSAandCanada
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ThisbookisareproductionofIndustry&Innovation16.1.ThePublisherrequeststhatthosecitingthisbook
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Contents
Introduction
Bjørn T. Asheim, Olof Ejermo & Annika Rickne 1
1. Do Regional and Non-regional Knowledge Flows Differ?
An Empirical Study on Clustered Firms in the Dutch Life
Sciences and Computing Services Industry
Anet Weterings & Roderik Ponds 11
2. Shaken, Not Stirred: The Re-combinatorial Capacity of
High-Tech Regions: Redeployment of Resources Released
from the Downsizing of a Lead Pharmaceutical Firm
Henrich Dahlgren & Finn Valentin 33
3. Investing in Localized Relationships with Universities:
What are the Benefits for R&D Subsidiaries of Multinational Enterprises?
Anders Broström, Maureen McKelvey & Christian Sandström 59
4. Place, Space and Distance: Towards A Geography of Knowledge-Intensive
Business Services Innovation
Richard Shearmur & David Doloreux 79
5. Location Attributes and Start-ups in Knowledge-Intensive
Business Services
Martin Andersson & Karin Hellerstedt 103
6. Promoting Regional Innovation Systems in a Global Context
Cali Nuur, Linda Gustavsson & Staffan Laestadius 123
Index 141
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Introduction
{
BJØRN T. ASHEIM* **, OLOF EJERMO* & ANNIKA RICKNE*
*CIRCLE(CentreforInnovationResearchandCompetenceintheLearningEconomy),LundUniversity,Lund,
Sweden,**DepartmentofSocialandEconomicGeography,LundUniversity,Lund,Sweden,{TheDahmenInstitute,
O¨rebro,Sweden
This special issue focuses on the importance of geography and/or space in explaining
knowledge flows, entrepreneurship and innovation. During the last few decades spatial
perspectiveshaveenjoyedagrowingattentionoutsidethespecificdisciplineofgeography
bothinacademiceconomicsandamongpractitionersofpolicyandplanning.Ineconomics
we find these tendencies in newer and/or more heterodox types of economics than the
traditionalmainstream,whichwiththeexceptionof‘‘regionaleconomics’’andtradetheory
hasnot paidmuch attentiontothe role ofspace.According to Krugman(2000: 49):
while this [neoclassical] tradition need not in principle exclude the possibilities of increasing
returns, imperfectly competitive markets, and a crucial role for history, in practice the
understandable tendency to follow the line of least mathematical resistance has biased trade
theorytowardstatic,perfectlycompetitive,constantreturnsstories.Unfortunately,itisnotpossible
tousethosestoriestoaddressmostoftheinterestingquestionsineconomicgeography.
Examplesofsuchnewapproacheswouldpreciselybe‘‘geographicaleconomics’’withthe
latest Nobel prize winner in economics, the above-mentioned Paul Krugman, as the most
well-known representative, focusing on the importance of trade and agglomeration for
economic growth,1 innovation studies (Fagerberg et al., 2005) as well as business
1Krugmanandhisfollowersusetheconcept‘‘neweconomicgeography’’,which,however,isconfusingasthisisalso
used to describe new approaches within ‘‘economic geography proper’’ (Martin, 1999), something also Krugman
himselfisawareof:‘‘Iamawarethatthisnamecanannoyhard-workingtraditionaleconomicgeographers,whofeel
boththatmanyofthethingsthe‘new’geographerssayareoldhat,andalsothatneweconomicgeographyignores
almostasmuchoftherealitytheystudyasoldtradetheorydid’’(Krugman,2000:50).
1
WHEN IS REGIONAL "BEAUTIFUL"?
economicswithMichaelPorterandhispromotionofindustrialandregionalclustersasakey
strategytofosterinnovativenessandcompetitivenessamongfirms,regionsandnationsas
thebestexample.Porter(1994:38)maintainedthat‘‘economicgeographymustmovefrom
theperipherytothemainstream[ofeconomics]’’.Krugmanarguesthathis‘‘new’’economic
geography‘‘hasendedthelongsilenceofmainstreameconomicsonthewholequestionof
where economic activity takes place and why’’ (2000: 59). On the other hand during the
1990stherewereauthorswhopublishedbookswithtitlessuchasTheEndofGeography
(O’Brien,1991)andtheDeathofDistance(Cairncross,1997),arguingthatduetotherapid
development of new technologies such as ICT (information and communications
technology) the barrier of distance and geography had been overcome (e.g. money could
betransferredacrosslongdistancesinnotime).However,atthesametimecertainglobal
cities such as London, Frankfurt, New York and Tokyo kept their strong position as world
financialcentres.
This illustrates that geography can be understood as distance as well as context.
However, distance and context should not be analysed as separate phenomena but as
interdependentfactors.Whenpeopletalkabout‘‘endofgeography’’and‘‘deathofdistance’’
itis(physical)‘‘distance’’assuchwhichisbeingreferredto,and‘‘context’’isneglected.On
the other hand, ‘‘context’’ does not mean the same for all kinds of activities, as some
activitieswithcertaincharacteristicsaremoresensitivetowardsdistancethanothers,that
is, proximity meansmore forcarrying out theseactivities.
Looking back on the history of economics broadly defined space and geography
have played aquite significant role.Alfred Marshall, typically referred to asthe founder of
neoclassical economics, is a forerunner for the contemporary new economic heterodoxy
with hiswritingsonindustrial districts (Asheim,2000).However,asthiswritingappearsin
Principles of Economics and Industry and Trade, Marshall is not very typical of a
neoclassical economist. Marshall talks about the existence of different categories of
firms; the importance of proximity in order to achieve external scale economies; the
relevance of broader environmental factors (sometimes referred to as ‘‘Marshallian
agglomeration economies’’ to underline its additional character of localization and
urbanization economies);2 and finally, he refers to entrepreneurs as ‘‘the best educators
of initiative and versatility, which are the chief sources of industrial progress’’ (Marshall,
1921: 249).
AlfredWeber(thebrotherofMaxWeber)isthefounderofmodernlocationtheory.For
him, distance understood as relative distance measured by transport costs, was the key
factordeterminingandexplainingthelocationaldecisioneithertosettlewithamarketora
raw material oriented location. However, in addition to distance and transport costs he
included considerations on agglomeration advantages in his theory, which, thus, more
reflects geography understoodascontext.
Porter’soriginalclusterconceptwas basicallyaneconomicconcept indicatingthat‘‘a
nation’s successful industries are usually linked through vertical (buyer/supplier) or
horizontal (commoncustomers,technology etc.) relationships’’ (Porter, 1990:149). These
ideasaremoreorlessthesameastheonesPerrouxpresentedintheearly1950s(Perroux,
2Thisexpandstheconceptofagglomerationeconomiestotakeintoaccountfactorsthatreducetransactioncostsand
stimulate(informal)networking(e.g.socialcapitalandtrust)aswellasfactorspointingtothe(informal)labourskills
suchastacitknowledge,aspartofwhatMarshallcalled‘‘industrialatmosphere’’.
2
WHEN IS REGIONAL "BEAUTIFUL"?
1970). Perroux argued that it was possible to talk about ‘‘growth poles’’ (or ‘‘development
poles’’atalaterstageinhiswriting)in‘‘abstracteconomicspaces’’,wherefirmswerelinked
together by an innovative ‘‘key industry’’ to form an industrial complex. According to
Perroux, the growth potential and competitiveness of growth poles can be intensified by
territorialagglomerationinwhathecalled‘‘concretegeographicspace’’(Perroux,1970).In
his 1990 book Porter argued along the same lines as Perroux by emphasizing that ‘‘the
processofclustering,andtheinterchangeamongindustriesinthecluster,alsoworksbest
whenthe industries involvedaregeographically concentrated’’(Porter, 1990:157).
The renewed focus on agglomerations and the regional context also provides
substantiation for Porter’s claim that competitive advantage is based on the exploitation
of unique resources and competencies (1990), and points to economic development as a
territorial embedded process, maintaining that ‘‘competitive advantage is created and
sustainedthroughahighlylocalizedprocess’’(1990:19).Thecontinuoussuccessofmany
oftheseneweconomic(regional)spaces(someofthemwereinfactnotthatnew(e.g.the
industrial districts ofthe Third Italy)) alsodemonstratedbeyond anydoubt that geography
(understoodas‘‘context’’andnotprimarily‘‘distance’’),contingenciesandparticularitiesstill
matterinaglobalizingeconomy.Itcouldevenbearguedthatthistendencytowardsspatial
concentrationhas becomemore markedovertime, not less.
Contextis,thus,importantforunderstandingeconomicactivity.Geography,according
tothefamousSwedishgeographerTorstenHa¨gerstrand,isaboutdoingcontextualanalysis
asopposedtocompositionalanalysis,whichisthetaskofotherscientificdisciplines(1974).
ThisdistinctioncorrespondstotheonetheGermanphilosopherImmanuelKantusedwhen
classifying sciences either as physically or logically defined. Geography and history
understood as chorology and chronology, respectively, constitute the physically defined
sciences, while other disciplines are logically defined based on their respective objects of
study. Geography and history are idiographic, synthetic (i.e. empirical based) sciences,
whilethelogicallydefinedarenomothetic,analytical.Thesedistinctionsarefundamentalin
understandingtheraisond’eˆtreofgeographyaswellasitsplaceandpositioninthedivision
of labourwith otherdisciplines (Asheim,2006).
Thekeyproblemingeographyisthespace–societyrelationshipandtheadequatelevel
of the theoretization of space. Geography as chorology traditionally implied an analytical
distinctionbetweenspaceandsociety,definedasanon-spatialentity,whichwasstudiedby
other social scientists (e.g. economists). In the ‘‘spatial analysis’’ tradition dominating
economic geography until the beginning of the 1970s the explicit object of study was the
spatial operationalized as relative distance or location and the ambition was analytical.
While clearly representing a scientific progress moving from descriptive, idiographic
regional geography studies based on an absolute perception of space to analytical,
nomothetic spatial analysis, at the end of the 1960s this tradition had stiffened in empty,
formal analyses of the appearances of spatial phenomena as such independent of the
social,economic andpolitical contextsof the eventsstudied.
An understanding of space as a property of an object, and, thus, eliminating the
distinctionoftherelativeconceptionofspacebetweenthespatialandthenon-spatial,had
alreadybeenintroduced in 1973bythe mostwell-known human geographer today,David
Harvey, with the concept relational space in his book Social Justice and the City. In the
introductorychapter ofthe book hewritesthat:
3