Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages...
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![Page 1: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/1.jpg)
Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with
the centres?
Sara Davies
Open Innovation Forum, Kouvola, 23-24 August 2010
Research funded by the UK Innovation Centre
(BIS, ESRC, NESTA and TSB)
![Page 2: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/2.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde2
Outline
• Traditional views of linkages and innovation
• Changing context for linkages and innovation
• Challenges for rural areas• Kinds of innovation seen in rural areas• Urban-rural innovation linkages• Policy support for urban-rural linkages• Policy challenges
![Page 3: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/3.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde3
Traditional views oflinkages and innovation
• Linkages in agglomerations promote innovation:– Knowledge spillovers, labour pooling and input-output
links -> increasing returns for firms in large markets (Marshall)
– As fixed costs fall, other areas with good linkages enjoy spread effects (Myrdal)
– Regional networks and institutions support innovation (Aydalot, Storper)
• Linkages promote innovation by:– Facilitating access to multiple sources of information– Allowing more intense interaction– Challenging existing ways of doing and thinking– Increasing scope for specialisation
![Page 4: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/4.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde4
Changing context forlinkages and innovation
• ICT increases scope for linkages across distance– More and stronger interactions between people– Distance working (and specialisation)– Firms can supply more distant markets – More challenges to existing ways of thinking/doing
• Lower barriers to international trade & capital flows– Increased international interactions between/within firms – Concentration of some activities (economies of scale)– More geographically integrated production relations
• Focus on openness (Chesbrough; cf. Granovetter; Grabher)– Facilitates cooperation between different people– Allows information from different sources to be combined
![Page 5: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/5.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde5
Challenges for small and mediumcentres and rural areas
• ICT and changes in economic integration ->– New opportunities (eg. attraction of new firms)– New challenges (eg. increased competition)
• Sparse local population means:– Limits on linkages within the area– Fewer linkages to external sources of knowledge– Greater need for openness
• Ongoing relations of dependence– Business and policy decisions are often taken
elsewhere and in the interests of people located elsewhere
– (Human, natural…) resources often flow out of the region
– Firms are often price-takers not price-setters
![Page 6: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/6.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde6
Kinds of innovation in rural areas:Definitions
• International differences in definitions of ‘rural areas’– National and regional population density– Level of demographic & economic
concentration– Number, size and functions of regional centres– Income and employment levels
• Differences in definitions of innovation– R&D innovation is usually weaker in rural areas– Less clear for broader categories of innovation
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Sara Davies, European Policies Research Centre, University of Strathclyde7
Patent applications/mn pop, 2007,National & 2 rural regions
(Source: Eurostat)
0
20
40
60
80
100
120
140
160
180
200
Germany France Italy Austria Finland Sweden UK
![Page 8: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/8.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde8
R&D spend as % of GDP, 2007,National & 2 rural regions
(Note: France & Italy data are for 2004. Source: Eurostat)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
![Page 9: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/9.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde9
Business R&D spend as % of GDP, 2007,National & 2 rural regions
(Note: Germany & Italy data are for 2005, France for 2004. Source: Eurostat)
0.00.51.01.52.02.53.03.54.04.55.0
![Page 10: Innovation in small and medium-sized centres and rural areas: what potential for stronger linkages with the centres? Sara Davies Open Innovation Forum,](https://reader035.fdocuments.us/reader035/viewer/2022062519/5697c01b1a28abf838ccf88b/html5/thumbnails/10.jpg)
Sara Davies, European Policies Research Centre, University of Strathclyde10
EU innovation policiesand urban-rural linkages
• Framework Programme 7– Mainly focused on EU R&D excellence– Some support for regional clusters and Convergence regions
• Competitiveness & Innovation Programme– May support urban-rural linkages e.g. innovation service
centres, transnational networking, use of ICT services• Cohesion policy / Structural Funds
– Some programmes support infrastructure, SME advice etc– National programmes mainly support national development– Most regional programmes do not directly target urban-rural
linkages– Regional programmes may constrain interregional openness– Division of tasks between ERDF/ESF and EAFRD
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Sara Davies, European Policies Research Centre, University of Strathclyde11
National/regional policiesfor urban-rural linkages
• Not usually an explicit goal of national/ regional innovation policies– National/regional strengths– National/regional capacities– International networking
• Often institutionalised divides– Between national innovation policy and regional
policies– Between urban and rural policies– Between different regional programmes
• But in practice there are policies that help to build urban-rural linkages for innovation
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Sara Davies, European Policies Research Centre, University of Strathclyde12
National/regional policies:Basic conditions for openness
• Investment in infrastructure– Interregional transport networks & services– ICT networks, broadband availability & quality
• Encouraging openness to new ideas from elsewhere– Schools, universities, foreign languages– International events in small/medium centres
• Ensuring good institutions in order to promote trust and low corruption
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Sara Davies, European Policies Research Centre, University of Strathclyde13
Business use ofbroadband, 2009
(Source: OECD)
80828486889092949698
100
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Sara Davies, European Policies Research Centre, University of Strathclyde14
Households with broadband, 2009National & 2 rural regions
(Note: UK data are for 2008; Source: Eurostat)
0102030405060708090
100
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Sara Davies, European Policies Research Centre, University of Strathclyde15
Openness to foreign ideas(Source: NESTA, 2009: IMD WCY Survey)
0123456789
10
Nether
lands
Canada
Sweden
Finlan
d
United S
tate
s
United K
ingdom
Germ
any
South
Kore
a
Franc
e
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Sara Davies, European Policies Research Centre, University of Strathclyde16
National/regional policies :Forums for interregional interaction
• Interregional business forums (eg. Germany)
• Hub-and-spoke cooperation for innovation (eg. some of Norway’s Arena projects)
• Formal urban-rural institutions (eg. multi-site University of Cumbria in UK)
• Interregional linkages between local networks– Policy-makers (eg. ÖROK in Austria)– Funders (e.g. business angels in UK)
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Sara Davies, European Policies Research Centre, University of Strathclyde17
National/regional policies:Direct brokerage
• Local offices help innovative firms find– Customers (eg. Innovation Norway) – Funding (eg. Sweden’s Norrlandsfonden)– Help with new ideas/products (eg. Germany)– Information (eg. Austria’s Regional
Managements)
• Local/regional offices intervene actively– Package and market the natural & human
resources of rural areas to customers in the centres (e.g. Scotland-UK)
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Sara Davies, European Policies Research Centre, University of Strathclyde18
National/regional policies:Build rural capacity to
link with urban areas
• Enhance key organisations e.g. universities & colleges (eg. VINN Excellence Centres in Sweden)
• Promote local networking between businesses and researchers (eg. Finland’s Regional Centres programme)
• Reduce the outflow of human resources (via higher education and graduate placement schemes)
• Attract leading firms (via aid, infrastructure and advisory packages)
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Sara Davies, European Policies Research Centre, University of Strathclyde19
Policy challenges
• Draw on best practice to support urban-rural linkages in the national/regional context– Basic conditions for openness– Forums for urban-rural interaction– Direct brokerage of linkages– Rural capacities to interact
• Overcome institutional obstacles to urban-rural interaction– Between EU policies– Between national policies– Between regional programmes
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Sara Davies, European Policies Research Centre, University of Strathclyde20
Thank you for listening!
http://www.eprc.strath.ac.uk/irr/