Papers in Evolutionary Economic Geography

December 1, 2009

#09.21 The importance of R&D subsidies and technological infrastructure for regional innovation performance – A conditional efficiency approach

Tom Broekel and Charlotte Schlump

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The importance of R&D subsidies for innovation activities is highlighted by numerous firm-level studies. These approaches miss however the systematic regional character of innovation activities and potential firm-spanning effects of this policy measure. The literature on regional innovation performance has widely neglected R&D subsidies so far.

This paper analyzes the importance of R&D subsidies as well as the relevance of a publicly funded technological infrastructure for the innovation efficiency of German regions. Using conditional nonparametric frontier techniques we find positive effects of R&D subsidies and somewhat smaller ones for the technological infrastructure, which however vary between industries.

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November 16, 2009

#09.20 Drivers of Globalization: An Evolutionary Perspective on Firm-State Relations in the Asian Newly Industrialized Economies

Henry Wai-chung Yeung

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The emergence of firms from the Asian Newly Industrialized Economies (NIEs) in the global economy during the past two decades has been phenomenal. Many pundits have attributed the competitive success of these Asian NIE firms and their home economies to the relentless efforts of the so-called developmental states. They argue that state initiatives such as active industrial policy and financial support have enabled these “national champions” to venture into and compete successfully in the global economy. This statist approach to the globalization of Asian firms and their home economies, however, has unfortunately ignored the complex and dynamic evolutionary nature of firm-state relations within the changing context of economic globalization. Drawing upon an institutional and evolutionary theory of change and adjustments, I aim to explain how the global emergence of Asian firms cannot be simply read off from and explained by their embeddedness in the developmental state. Since the 1990s, these Asian firms have strategically disembedded from state apparatus and successfully reembedded themselves in dynamic global production networks. This shift of strategic partnership of Asian firms from firm-state to firm-firm networks has profound implications for our understanding of the present and future trajectories of regional economies in Asia. It presages the demise of the developmental state as the primary driver of economic change and growth in Asian economies. In developing my conceptualization of changing firm-state relations, this paper draws upon several emerging and interrelated research frontiers in economic geography that call for more theoretical attention to trans-local actors and processes, evolutionary dynamics of change, and institutional contexts.

November 13, 2009

#09.19 The Jatropha Biofuels Sector in Tanzania 2005-9: Evolution Towards Sustainability?

Filed under: 2009 — Tags: , , , , , , — Noegg Blogger @ 3:52 pm

Marjolein Caniëls and Henny Romijn

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Biofuel production from the tropical plant Jatropha curcas L. has recently attracted a great deal of attention. Some anticipate substantial social and environmental benefits from its cultivation, while at the same time expecting sound profitability for investors. Others are more doubtful, envisaging large trade-offs between the pursuit of social, environmental and economic objectives. The paper explores these issues in Tanzania, a forerunner in the cultivation of Jatropha in Africa. We trace how isolated Jatropha biofuel experiments in the country developed since their inception in early 2005 towards a fully fledged sectoral production and innovation system; and investigate to what extent that system has been capable of developing ánd maintaining sustainable practices and producing sustainable outcomes. The application of evolutionary economic theory allows us to view the ongoing development processes in the sector as a result of evolutionary variation and selection on the one hand, and revolutionary contestation between different coalitions of stakeholders on the other. Both these processes constitute significant engines of change in the sector. While variation and selection is driven predominantly by localised learning, the conflict-driven dynamics are highly globalised. The sector is found to have moved some way towards a full sectoral innovation and production system, but it is impossible to predict whether a viable sector with a strong “triple bottom line” orientation will ultimate emerge, since many issues surrounding the social, environmental and financial sustainability still remain unresolved.

#09.18 Spaces of Innovation: learning, proximity and the ecological turn

Filed under: 2009 — Tags: , , — Noegg Blogger @ 3:37 pm

Adrian Healy and Kevin Morgan

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Contrary to the fashionable “death of distance” thesis, the socio-spatial context for innovation remains as important as ever for firms, networks and the public institutions that tend to be neglected in orthodox narratives of learning. In this article we explore the changing socio-spatial dynamics of innovation through the medium of three arguments: (i) that the “learning region” debate was worth having because it triggered a fruitful dialogue between innovation theorists and economic geographers; (ii) that geographical proximity remains central to our understanding of learning and innovation and should not be reduced to, or conflated with, physical co-location; and (iii) that “the ecological turn” challenges conventional conceptions of learning, innovation and development, posing  unsettling questions about the forces of path dependency, especially in less favoured regions.

October 28, 2009

#09.17 Regional Factors and Innovativeness – An Empirical Analysis of Four German Industries

Tom Broekel and Thomas Brenner

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A growing body of work emphasizes the importance of regional factors for regional innovativeness. In this paper, about seventy variables approximating the social-economic characteristics of regions are aggregated to twelve regional factors. In four industry-specific set-ups their influence on firms’ innovativeness is tested. The study confirms that inter-industrial differences exist in the importance of these factors. In the empirical analyses a log-linear model is compared with a linear approach. While both are theoretically problematic it is shown that the log-linear model performs better in the empirical assessment.

#09.16 How do regions diversify over time? Industry relatedness and the development of new growth paths in regions

Filed under: 2009 — Tags: , , , — Noegg Blogger @ 8:40 am

Frank Neffke and Martin Henning and Ron Boschma

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The question of how new regional growth paths emerge has been raised by many leading economic geographers. From an evolutionary perspective, there are strong reasons to believe that regions are most likely to branch into industries that are technologically related to the preexisting industries in the region. Employing a new indicator of technological relatedness between manufacturing industries, we analyze the economic evolution of 70 Swedish regions during the period 1969-2002 using detailed plant-level data. Our analyses show that the long-term evolution of the economic landscape in Sweden is subject to strong path dependencies. Industries that were technologically related to pre-existing industries in a region had a higher probability to enter the region, as compared to unrelated industries. And unrelated industries had a higher probability to exit the region. Moreover, we found that industrial profiles of Swedish regions showed a high degree of technological coherence. Despite substantial structural change, this coherence was very persistent over time. Our methodology also proved useful when focusing on the economic evolution of one particular region. Our analysis showed that the Linköping region increased its industrial coherence during 30 years, due to the entry of industries that were closely related to its regional portfolio on the one hand, and the exit of industries that were technologically peripheral to its regional portfolio on the other hand. In sum, we find systematic evidence that the rise and fall of industries is strongly conditioned by industrial relatedness at the regional level.

October 13, 2009

#09.15 Knowledge Networks in the Dutch Aviation Industry: The Proximity Paradox

Filed under: 2009 — Tags: , , , , , — Noegg Blogger @ 10:22 am

Tom Broekel and Ron Boschma

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The importance of geographical proximity for interaction and knowledge sharing has been discussed extensively in economic geography in recent years. There is increasing consensus that it is just one out of many types of proximities that might be relevant. We argue that proximity may be a crucial driver for agents to connect and exchange knowledge, but too much proximity between these agents on any of the dimensions might harm their innovative performance at the same time. In a study on knowledge networks in the Dutch aviation industry, we test this so-called proximity paradox empirically. We find evidence that the proximity paradox holds to some degree. Our study clearly shows that cognitive, social and geographical proximity are crucial for explaining the knowledge network of the Dutch aviation industry. But while it takes cognitive, social and geographical proximity to exchange knowledge, we found evidence that proximity lowers firms’ innovative performance, but only in the cognitive dimension.

#09.14 Proximity and the Evolution of Collaboration Networks: Evidence from R&D Projects within the GNSS Industry

Pierre-Alexandre Balland

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Increasing attention had been given recently to understand how networks affect organizational performance in innovation studies. Surprisingly, underlying mechanisms of their evolution have been more neglected, and still remain unclear. This lack of interest is denounced today by recent papers which claim that it is a crucial issue for economic geography. Especially the influence of different forms of proximity on the network’s changes needs to be clarified. This paper contributes to this ongoing debate by determining empirically how organizations choose their partners given to their geographical, organizational, institutional, cognitive and social proximity. The relational database is constructed from publicly available information on the R&D collaborative projects of the 6th European Union Framework Program within the navigation by satellite industry (GNSS). Patterns of evolution of the GNSS collaboration network are determined according to a longitudinal study of the relational changes occurred between four consecutive years, from 2004 to 2007. Empirical results show that geographical, organizational and institutional proximity favour collaboration. Inversely, organizations prefer to avoid partnerships when they share a cognitive proximity (same knowledge bases). The last result demonstrates that the kind of project studied does not create a sufficient level of social proximity to stimulate collaboration.

September 25, 2009

#09.13 Entrepreneurship, Evolution and Geography

Filed under: 2009 — Tags: , , — Noegg Blogger @ 9:13 am

Erik Stam

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This chapter is an inquiry into the role of entrepreneurship in evolutionary economic geography. The focus is on how and why entrepreneurship is a distinctly spatially uneven process. We will start with a discussion on the role of entrepreneurship in the theory of economic evolution. Next, we will review the empirical literature on the geography of entrepreneurship. The chapter concludes with a discussion of a future agenda for the study of entrepreneurship within evolutionary economic geography.

#09.12 Evolutionary economic geography and its implications for regional innovation policy

Ron Boschma

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Related variety is important to regional growth because it induces knowledge transfer between complementary sectors at the regional level. This is accomplished through three mechanisms: spinoff dynamics, labor mobility and network formation. They transfer knowledge across related sectors, which contributes to industrial renewal and economic branching in regions. Since these mechanisms of knowledge transfer are basically taking place at the regional level, and because they make regions move into new growth paths while building on their existing assets, regional innovation policy should encourage spinoff activity, labor mobility and network formation. Doing so, policy builds on region-specific assets that provides opportunities but also sets limits to what can be achieved by policy. Public intervention should neither apply ‘one-size-fits-all’ approaches nor adopt ‘picking-the- winner’ strategies, but should aim to connect complementary sectors and exploit related variety as a source of regional diversification.

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