Constructing Regional Advantage from Innovation Systems Phil Cooke Centre for Advanced Studies University of Wales, Cardiff Presented at INGENIO Conference in Valencia, 7 June, 2007

The Argument in Brief Shift to a Knowledge Economy Regional KE Disparities 2 x GDP Gap FDI Diverts from W. to E. Europe, Asia (esp. China) & N. Africa RDAs struggle to switch towards ‘Entrepreneurship’ & ‘Knowledge-seeking’ Serious Innovation System Barriers but Interesting Experimentation

Knowledge Economy Index: Regions Ranked 152 to 189 in 1998 to 2006

Knowledge Economy Index: Regional Knowledge Economies Ranked Top

What Is An Innovation System? Set of Nodes in Innovation Chains Systemic, Interactive Linkages Knowledge Generation Firms & Institutions Knowledge Exploitation Firms Soft Infrastructure Financing Commercialisation and Marketing Feedback and Policy Support

Regional Innovation Systems Knowledge Generation & Exploitation Sub- systems Boundary-crossing problem Entrepreneurial RIS – ERIS (markets) Institutional RIS – IRIS (RDAs etc.) Functioning ERIS Greater Boston Functioning IRIS Baden-Wurttemberg ‘Developmental State’ IRIS – Wales ‘Knowledge Economy’ IRIS - Scotland

Tendency Towards Networking

‘Developmental States’ Globalisation diverts to E. Europe, Asia etc. means FDI drought in less favoured regions in Western EU, such as Basque C., Wales etc. Entrepreneurship & Innovation Structural Funds – part of Wales now Objective1 Entrepreneurship Action Plan Finance Wales Knowledge Exploitation Fund Technium Multiple Disconnects

National Botanic Gardens & BioTechnium Wales

Preseli: related variety

Regional Knowledge Economies Ranked from 31 to

Rural Knowledges: Monmouthshire Wales 20 Gastropubs 35 Organic Farms –13 Beef –12 Lamb –10 Horticulture 15 Vineyards 8 Art Galleries 1 National Park 10 Farmer’s Markets Abergavenny Food Festival, visitors Wales International Film School Ryder Cup Golf 2010

Tuscany Art-Food System Wine Associations e.g. Chianti, Grossetto Tuscany Region/‘Strade Del Vino’ – 16 Wine Tours Hospitality Association – Benvenuti in Toscana Enoteca Training, Fiesole (nr. Florence) High School & University Cuisine Training Racolta Organic Food Distribution Cuisine Farms, Art Farms, Agro-Tourism Etruscan, Roman Archaeology 3 Eco-Museums, GeoParks Orchestras, Music Schools (e.g. Limana), Art Institutions, L’Accademia Fine Arts, Florence

Skåne Food Cluster A regional agro-food innovation network established in Skåne in 1994.A research-technology led governance structure, –Functional, Conventional –Organic foods excluded Methodology – main focus on functional food –Integration of Engineering (food technology), Nutrition, Functional Foods etc. High focus on future ’food-health’ markets BUT Exclusion of Malmö ‘Food & Environment’ programme (100% organic shool meals by 2012) Neglect of Copenhagen’s Dogme (75% organic food in all municipal kitchens by 2009) 80% Sweden’s food market ‘institutional’; 20% private consumption

Academe-biotechnology push too pronounced –research-industry, research-market gaps & inwardly focused Imbalance in governance –Local authority yet to fully integrate –Only 33% of Skåne agro-food firms engaged –Most are, large, conventional ‘cook-chill’ firms Exclusion of Organic Food Interests –Despite its fast market growth, big local ‘institutional’ markets (& interaction with aspects of S&T e.g. breeding, genetic selection) Better external Branding needed –Slow opening out internationally, e.g. Mona Carota –International Food & Health Conference initiative commendable Skåne Food Cluster: aspects for reflection

Finland: Lahti Region – Furniture to Nano The key aim is to explore market potentials of regional assets and capabilities, These explorations define regional development platforms in conceptual terms. Regional development platforms are asset configurations evolved from path dependencies aimed at examining and exploiting market potential, Regional platform actors include firms, intermediaries, knowledge centres, research, cultural and talent formation organisations, Regional platforms comprise industry and knowledge in context of techno-economic paradigm change or ‘global megatrends’ relevant to the specific region. Lahti RDPM model very advanced, expert panels, leadership, envisioning, new platforms

Lahti’s Nanotechnologies – from atom slices to bacteria & DNA

Lahti Regional Development Platform Method Seeking to construct regional advantage After traditional furniture industry decline Expert envisioning panels Outside experts Nanotechnologies for environmental and healthcare platforms Platforms link from Corn-Food-Biofuels- Health-Sport-Environment Platform

Rogaland-Stavanger Culinary Innovation Platform

RELATED VARIETY PLATFORM: Forestry Diversification FORESTRY Information Technology Sensors, measuring & control Computational intelligence, simulation and machine vision Multimedia and telecommunication Tomography Manufacturing Technology Forestry machines Process & production machinery Materials technology FOREST INDUSTRY Pulp & Paper Technology Wood Products Industry Machines, Machinery & Processes Construction & Wood technology Wood modifying Construction/archi tecture Logistics, assembly Markets Quality Price Environ-mental Biotechnology Enzymes Rot protection Gene technology Chemical Technology Bleaching Surface treatment Pigments, adhesives Energy & Environ- Mental Technology Biofuels Combustion Energy saving Emissions Technology

Knowledge Base, Innovation System & Platform

Conclusions Knowledge Economies create new pressures for economic development Construct/reconstruct Knowledge Generation/Exploitation System Market Failure means IRIS ‘Constructed Advantage’ not ERIS Public Sector Innovation Drivers, Sustainability, Regulation? Smarter, Deeper ‘Knowledge Flows’ Measures to ‘Construct Advantage’

Thank You and Good Bye! Prof. Phil Cooke Centre for Advanced Studies University of Wales, Cardiff Regional Industrial Research