Mario Pezzini

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• Mario Pezzini

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Trends seen with traditional glasses
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Growth in OECD regions dwarfed by growth in
(some) Asian regions

• Shanghai aims to increase RD intensity to
  3.3 by 2020

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The Nature of Innovation
Concentration of Innovation Patent applications
per million inhabitants (2005)
Research-intensive innovation remains highly
concentrated
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Regions with the highest number of patent
applications per million population compared to
their country average, 2005
Source OECD Regions at a Glance 2009
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More than one third of OECD regions have less
than 10 patents per million population. These
regions tend to invest less in RD and have lower
shares of employment in high technology sectors
Correlation between RD expenditures and patent
applications, 2000-2005
Source OECD Regions at a Glance 2009
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The Nature of Innovation
Features related to Innovation

• Regions that experience higher levels of
  patenting activity are doing so through
• Greater RD expenditure
• Greater involvement of the private sector in
  innovation projects
• Higher employment shares in high-tech sectors

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The Nature of Innovation
Collaboration for Innovation Patents with
co-inventors (2005)
Collaboration for innovation is also concentrated
in few places.
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Patents with at least one co-inventor by
residence of the co-inventor, 2005
Correlation between business and non-business
patenting activities (pooled 2000-2004)
Source OECD Regions at a Glance 2009
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What are the results of the analysis on
innovation?

• If.
• Research-intensive innovation remains highly
  concentrated
• Some regions are catching up (Shanghai 2.3
  RD/GDP), but many will not
• .the future appear uncertain
• However, regions vary greatly in how they
  innovate and indicators capture only part of
  this.
• There is a changing nature of innovation that
  reinforces the opportunities for dynamics in all
  regions

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The policy supply
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Why adopting a regional approach?

• The systems focus serves to identify different
  kinds of gaps and failures for policy
  intervention
• Weaknesses in one part of system limit economic
  growth
• Market failure is not the only problem
• National policymakers are struggling with how to
  incorporate the RIS concept into policy
• What is the most efficient spatial allocation of
  resources?
• How are different RIS served by a uniform
  policy?
• How to exploit trans-border effects?
• How to exploit trans-national externalities?

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What are the main problems and issues with the
RIS approach?

• Many regional strategies are not adapted to their
  context
• Not all regions can be Silicon Valley
  (knowledge-generation leader)
• But capacity to absorb knowledge to innovate is
  needed everywhere
• Be careful in producing fashion trends
• RIS is frequently a recast science- and
  research-based approach
• Most innovation principles are not recognised
  in supply-driven RIS plans
• Respective roles of national, regional and local
  level unclear
• Programme proliferation duplication creates
  confusion waste
• Administrative boundaries dont usually map to an
  RIS

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Regional Innovation Systems
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Regional Innovation Systems
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Eppur si muove!
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The New Regional Paradigm

• EU funds have been allocated following a
  convergence logic
• However, for a group of the relatively richer
  regions, funds seem to grow as well.

• Growth period refers to 1994-2006 for Belgium,
  Denmark, France, Germany, Greece, Ireland, Italy,
  Netherlands, Portugal, Spain and the UK
  1995-2006 for Austria, Finland and Sweden and
  2000-2006 for the Czech Republic, Hungary, Poland
  and the Slovak Republic.
• Initial year for per capita GDP in the horizontal
  axis is determined according to the growth
  period.
• Source Own calculations based on DGRegio.

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The New Regional Paradigm

• While infrastructure is still an important part
  of EU funds, competitiveness enhancing objectives
  comprise now more than half of all allocations.

• Business-environment objectives refers to
  assisting large business organisations, assisting
  SMEs and the craft sector and productive
  environment.
• Infrastructure refers to basic infrastructure,
  energy infrastructure, environmental
  infrastructure, planning and rehabilitation,
  social infrastructure and public health, telecom
  infrastructure and information society, and
  transport infrastructure.
• Labour market refers to human resources, labour
  market policy, and positive labour market actions
  for women.
• Innovation refers to research, technological
  development and innovation technical assistance
  and innovation actions and workforce
  flexibility, entrepreneurial activity,
  innovation, information and communication
  technologies.
• Social refers to social inclusion.
• Rural refers to promoting the adaptation and the
  development of rural areas.
• Tourism refers to tourism.
• Primary sector refers to agriculture, fisheries
  and forestry.
• Education refers to developing educational and
  vocational training.
• Source Own calculations based on DGRegio.

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The New Regional Paradigm

• Following a convergence logic, funds for
  infrastructure are allocated according to the
  degree of regional development.
• This remains a valid cohesion objective, but can
  be related also to compensatory regional policies

• Infrastructure refers to basic infrastructure,
  energy infrastructure, environmental
  infrastructure, planning and rehabilitation,
  social infrastructure and public health, telecom
  infrastructure and information society, and
  transport infrastructure.
• Source Own calculations based on DGRegio.

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The New Regional Paradigm

• In contrast, Regions regardless of their income
  levels, are supported with funds to develop
  innovation.
• This is in line with the Lisbon Strategy.

• Innovation refers to research, technological
  development and innovation technical assistance
  and innovation actions and workforce
  flexibility, entrepreneurial activity,
  innovation, information and communication
  technologies.
• Source Own calculations based on DGRegio.

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The New Regional Paradigm

• The same applies in allocation of funds for
  labour markets.

• Labour market refers to human resources, labour
  market policy, and positive labour market actions
  for women.
• Source Own calculations based on DGRegio.

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Risks

• Policy imitation
• Mere redistribution on equal standards
• Administrative rather than strategic management
• Lack of expertise at national and regional level
• Lack of a conceptual framework

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Action

• Identify comparative advantages
• Reveal information
• Group investments
• Experiment