| Dr. Otto Raspe & Dr. Mark Thissen 1 Regional Competitiveness ESPON Conference “Territory matters: keeping Europe and its regions competitive” June 16 th

| Dr. Otto Raspe 2 Why are regions interesting?….

| Dr. Otto Raspe 3 The world is spikey Source: PBL (2016) 'Reshaping Economic Geography' Worldbank (2009) 'Competitive cities in a global economy' OECD (2010) 'EU Agenda reformed cohesion policy; place-based approach' Barca (2009)

| Dr. Otto Raspe 4 The Great Divergence not every region / city is a winner Three types of America Mechanisms: clustering of innovation (high paid jobs) and trickle down (agglomeration economies) ‘the rising tide lifts all boats, at least all boats that are in the same city’ ‘your salary depends more on where you live, than on your résumé’

| Dr. Otto Raspe 5 Smart specialization Regions central role: Embeddedness Relatedness Connectivity Place-based: policy frameworks that are tailored to the local context, on the basis of best data available, the most detailed knowledge, and an explicit consideration of realistic potential of the region data.

Besides macro economic policy also regional conditions for competitiveness | Dr. Otto Raspe 6  Accessibility (national en international)  Labor market conditions (human capital)  Innovation  Education  Agglomeration circumstances  Clusters (specialization)  Networks  Investments in R&D (public and private), ….

Underlying questions  Who are your main competitors? Where are they located?  Which business climate factors are important for a good competitive position?  How does our business climate relate to that of our main competitors?  Where should we invest of fill the gap or to maintain our good position? Hereby :  ‘Revealed competition‘ based on trade | Dr. Otto Raspe 7

Revealed regional competition in Europe 8 South Holland exports Paris is a larger competitor than Vienna because South Holland and Paris have the largest market overlap Vienna exports Paris exports

| Dr. Otto Raspe 9 High Tech North Brabant Lombardia Île de France SE Ireland (Dublin) Düsseldorf Stuttgart Rhône-Alpes Arnsberg Oberbayern Köln Veneto Rank Region under investigation Regions in same country and further Who are the main competitors?

10 Benchmark Export products and services FDI share own sector Top university score Population size Patents Private R&D Population density Congestion Connectivity by air Cluster own sector Connectivity by road Weighted average competitors Increasing importance competitive factor Index is more than 200 Index (weighted average competitors = 100 Regional competitiveness factors and position for high tech North Brabant, 2010

North Brabant ‘investment agenda’ Local Buzz  Agglomeration economies  Clustering of high tech firms Global pipelines  Connectivity by air Maintain strong position on (private) knowledge infrastructure | Dr. Otto Raspe 11

European Regional Competitiveness Scoreboard | Dr. Otto Raspe 12

Not only focus on current state  Dynamics: Who wins / looses in you markets?  And: Why?  Decomposition of growth is needed to identify demand-led growth or structural growth (because you invest in the right things)  Research Smartspec Framework 7 project: Good Growth, Bad Growth: a Wake-up Call of Smart Specialisation (Thissen et al 2016 forthcoming) | Dr. Otto Raspe 13

| Dr. Otto Raspe 14 Who are the winners and the losers: growth decomposition Growth of region j (the Market) Growth of region i: more products sold Market j Marketshare of region i in market j Growth of region i due to demand-led growth in market j Growth of region i due to structural growth (gain in marketshare in market j)

What are Dynamic sectors? absolute structural or demand-led growth | Dr. Otto Raspe 15 Structural growth (% total growth) Demand led growth (% total growth) Total production(27%)(73%) Agricultural sector(62%)(38%) Food sector(69%)(31%) Materials sector(54%)(46%) High-technology sector(57%)(43%) Chemical sector(56%)(44%) Energy sector(36%)(64%) Financial services sector(31%)(69%) Business services sector(28%)(72%) Mining sector(42%)(58%) Manufacturing sector(53%)(47%) Electricity sector(57%)(43%) Construction sector(26%)(74%) Private services sector(26%)(74%) Public services sector(15%)(85%)

16 Evaluating the performance of sectors in regions: A dynamic Boston diagram Gaining regions Potentials Declining regions Losing regions gain in market share 0 0 Relative growth of the market 2.Structural growth (regional policy): Growth by increased competitiveness and gaining market share 1.Demand-led growth (External factors): Growth by increased demand from sales markets

17 Evaluating the performance of sectors in regions: A dynamic Boston diagram 2.Structural growth (regional policy): Growth by increased competitiveness and gaining market share 1.Demand-led growth (External factors): Growth by increased demand from sales markets

Performance of High Tech North Brabant (centered around the median) | Dr. Otto Raspe 18

Performance of High Tech North Brabant (centered around the median) | Dr. Otto Raspe 19 Lombardia Ile de France Dusseldorf Munich

Policy and stakeholders  What can we learn from regions that have outperformed us?  One sided T-test on 120 region characteristics attributed to 13 policy fields  The policy fields represent stakeholders  The characteristics represent policies  Work in progress: website will be launched soon (October 2016) | Dr. Otto Raspe 20

Conclusions  Regions important for economic growth & competitiveness  Place-based policy frame works need data on: –Competitiveness performance –Structural growth factors  To ultimately define ‘what works’ for regional economic growth | Dr. Otto Raspe 21

Thanks for your attention! | Dr. Otto Raspe 22