Innovation in peripheral regions Opportunities and challenges Ian Hill EU Policy and Development Officer Cumbria County Council, UK

Content The issues affecting peripheral regions Approaches to development in peripheral regions Processes that can assist development; learning from EU-funded projects Future development paths

Connected or competitive?

Accessibility and GDP Darkest red = below-average accessibility but high GDP What are the characteristics of these regions? What strategies have they followed?

Learning from EU projects: CRIPREDE EU Sixth Framework; Regions of Knowledge 2 Project aims: Understand the characteristics of successful R&D regions Audit our own regions against an adaptive R&D model Develop an RTD investment policy and strategy for our respective regions

The regional innovation paradox Lagging regions under invest in R+D and innovation activity and appear to face considerable difficulties in utilising public resources earmarked for innovation The Regional Innovation Paradox Oughton, Landabaso, and Morgan (2002)

Innovation and peripherality Innovation is not only the process of companies developing new products and services; Innovation is the total of all of the new ideas and approaches that accumulate in a territory 2 key sources exist for those new ideas: Collaboration by the actors within a territory Collaboration with other regions in and beyond that country The two processes must not exist in isolation; they are mutually reinforcing

Dare to be different….. Real regional competitive advantage comes from making a difference, not from doing the same things other regions do. (…) Likewise, by investing in similar technologies and copying best practices, regions undermine their potential competitive advantage and should not be surprised that in the end a painful regional shake-out will occur. Hospers, G.-J. (2005): Best Practices and the Dilemma of Regional Cluster Policy in Europe. Tijdschrift voor Economische en Sociale Geografie 96 (4).

The strengths and qualities of peripherality Access to high-quality cheap land Good virtual or electronic accessibility High quality of life and environment Strong internal networks and knowledge capital Resilience and problem-solving skills

Growth sectors for peripheral areas? Food and high-value agriculture-related produce (e.g. northern England) High-tech manufacturing (e.g. central Finland) Knowledge economy and ICT (e.g. western Ireland) Environmental technologies and energy (e.g. western Scotland) Tourism and recreation (many examples…)

How? The process factors Knowledge and learning Networks Leadership Regional actors Place, (Spatial) Proximity and Embeddedness (the process by which tacit knowledge gives regional benefits) a case study of high-technology spin-offs in the North East of England … question(s) the mainstream hypothesis that peripherality is a disadvantage for regional RTD, instead drawing attention to the influence of tradition and identity building. (Welter and Kolb, 2006)

Messages for the future Competitiveness is not wholly dependent upon physical connectivity Disparities in regional growth and competitiveness continue to widen Competitive regions are those whose public and private actors can collaborate within and beyond the territory Leadership is a key ingredient Peripheral regions must utilise all forms of EU support available; explore in particular the potential of Regions of Knowledge (FP7)