WIRE: Week of Innovative Regions in Europe Granada, 15th-17th March 2010 Claire Nauwelaers...

WIRE: Week of Innovative Regions in Europe Granada, 15th-17th March 2010

Claire NauwelaersInnovation Unit

Competitiveness and Regional Governance DivisionPublic Governance and Territorial Development

Directorate

OECDThe challenges for regional innovation policies: an EU-OECD project

Reglab Annual ConferenceNorrköping 2 February 2011

Regions and Innovation Policy

Claire NauwelaersRegional Development Policy

OCDE

WHY WORRY ABOUT INNOVATION AND REGIONS?

• Innovation has received increased priority to address not only productivity gaps, but also societal challenges in the move towards smart, sustainable and inclusive societies

• Regions are called as innovation mobilisers in their countries. Two moves: attention to territories in national innovation policies; more stress on innovation in regional development policies

• The adoption of a broader concept of innovation gives a chance to regions that are not at the technology frontier

How to organisecomplementarity/synergies between policies at various levels of government?

How effective are innovation policies by, for, in regions?

Volume I. Strategies, Governance and Challenges1. WHY REGIONS MATTER FOR INNOVATION POLICY2. ROAD MAPS AND STRATEGIC POLICY MIXES3. MULTI-LEVEL GOVERNANCE4. POLICY ADVICE

Volume II. Agencies, Instruments, Country Information

5. MAXIMISING THE IMPACT OF INNOVATION AGENCIES

6. POLICY INSTRUMENTS FOR REGIONAL INNOVATION7. COUNTRY INFORMATION

OECD PUBLICATION ON“REGIONS AND INNOVATION POLICIES”

OPENING THE BLACK BOX OF POLICIES:IDENTIFYING RELEVANT POLICY SPACES

Potential and limits for innovation policy in regions

1. Variety of institutional arrangements 2. Different types of innovation potential3. Diversity in regional development & innovation strategies

Three dimensions to take into account

Innovating for what? Building on current advantages Supporting socio-economic transformation

Catching up: towards creation of knowledge-based capabilities

Importance of setting policy priorities

DIVERSE REGIONS, DIVERSE POLICY RESPONSES

• S&T–driven innovation /application , adaptation of knowledge• Specialisation of productive fabric• Potential niches for smart specialisation• Innovation driven by large incumbents/New firms• Density of local linkages, regional cohesion, social capital• Orientation and strength of global linkages• Specific RIS bottlenecks: human capital, finance, etc.• Institutional competences of the region in innovation• Formal powers versus effective powers and budgetary means• Intensity and quality of public commitment to innovation

• Development choices, strategic priorities, future visions…

DIFFERENCES IN INSTITUTIONAL ARRANGEMENTS

Degree of devolution inSTI policy competences and

resourcesFederal countries

Countries with elected regional

authorities

Countries with non elected regional

level / decentralised State agencies

Significant control of STI powers and/or resources by regions

Austria, Belgium, Germany, Australia,

Canada, Switzerland, United States, Brazil

Italy, Spain UK (Scotland, Wales,

Northern Ireland)

Some decentralisation of STI powers and/or resources to regions

Mexico France, Netherlands, Poland, Sweden (pilot regions),

Denmark (autonomous

regions), Norway

UK (English regions), Sweden (except pilot

regions), Korea

No decentralisation of STI powers

Regional innovation strategies

Denmark ,Portugal (autonomous

regions), Slovak Republic, Turkey, Czech Republic

Hungary, Ireland, Portugal (mainland)

Innovation Projects only

Chile, Japan Greece, Finland, Luxembourg, Iceland, New

Zealand, Slovenia

Source: Regions and Innovation Policy OECD 2011

Sources� New research (in house, outside)

� OECD Survey on multi-level governance of STI policy

� OECD Territorial Reviews• Globalisation and Regional

Economies (several case studies)• North of England, UK

• Piedmont, Italy• 15 Mexican States

• Catalonia, Spain• Basque Country, Spain

• Switzerland

OECD SURVEY OF MULTI –LEVEL GOVERNANCEOF INNOVATION POLICY 2010

Survey content

– Roles, budgets and challenges at different levels– Multi-level governance coordination– Instruments used at different levels – Regional dimension of national STI policies– Future trends expected

Responses from 21 OECD countries and 4 non-OECD countries

RESPONSES TO OECD SURVEY

• Informationsharingacross levelsof governmentdifficult

• Capacity problemsat sub-national level to formulate/ deliverpolicy

• Financial resources insufficient for certain regions/ localities toactivelyparticipateand implementstrategicplans

• Administrative boundaries at regional and city/ local level animpediment to policyefforts

• Policy silos at supranational/national level undermining efforts tocoordinateat thesub-national level

• Inefficienciesdueto programmesproliferationfromdifferent levels

• Gaps in allocation of responsibilities: some policy areas uncovered atany level of government

0 5 10 15 20 25 30

Australia

Austria

Belgium

Canada

Mexico

Switzerland

Czech Republic

Denmark

France

Netherlands

Poland

Spain

Sweden

Finland

Hungary

Korea

Norway

Portugal

UK (England)

National

Regional

Common instruments

Federal

Unitary, elected regions

Unitary, administrative regions

Note: National refers to the number of instruments used at national level, regardless of whether used at other levels. Regional refers to instruments reported at regional level, regardless of whether used at other levels. Common instruments refers to the number of instruments reported at both national and regional levels.

.

NUMBER OF INSTRUMENTS USED

BY NATIONAL AND REGIONAL

GOVERNMENTS

Some instruments are more frequent at regional level, some at national level, and many at both levels.

0 5 10 15 20 25 30

Australia

Austria

Belgium

Canada

Mexico

Switzerland

Czech Republic

Denmark

France

Netherlands

Poland

Spain

Sweden

Finland

Hungary

Korea

Norway

Portugal

UK (England)

National

Regional

Common instruments

Instruments reported in common are not necessarily a duplication. They may be complementary:

• Shared financing• Different target groups

and purposes

CO-ORDINATION TOOLS CAN ADDRESS DIAGNOSED MULTI-LEVEL GOVERNANCE CHALLENGES

0

1

2

3

4

5

6

7

8

9

Notes: 24 reporting countries (20 OECD, 4 non-OECD countries), one country reported two top tools.

Source: OECD Survey on the Multi-level Governance of Science, Technology and Innovation Policy.

Most important co-ordination tool

0

1

2

3

4

5

6

7

8

1 2 3 4 5 6

Number of countries

Number of coordination tools

Note: Responses available for 22 countries.

Source: OECD Survey on the Multi-level Governance of Science, Technology and Innovation Policy.

Number of multi-level governance co-ordination tools used in a given country

Regular dialogue and consultation rated most important among tools

Multiple tools are used in any given country (generally 4 or more)

A COMPLEX DIVISION OF LABOUR

Source: Technopolis et al. (2006) Strategic Evaluation on Innovation and the knowledge based economy in relation to the Structural and Cohesion Funds, for the programming period 2007-2013: Synthesis Report. A report to the European Commission, Directorate General Regional Policy, Evaluation and additionality, 23 October 2006.

TYPOLOGY OF OECD REGIONS DISPLAYS VARIETY

Peripheral Regions

Industrial Production zones

Knowledge hubs

Knowledge Hubs Small sized knowledge intensive capital districts Regional knowledge and technology hubs

Industrial Production ZonesCore manufacturing and service providers Skill-intensive production centresService and rural production centresOld manufacturing centres

Peripheral RegionsLow populated peripheral regions in rich countries Structural inertia/de-industrialising regionsRural low populated regions


TYPOLOGY OF OECD REGIONS: WITHIN COUNTRY DIVERSITY

Knowledge Hubs Small sized knowledge intensive capital districts Regional knowledge and technology hubs 1

Industrial Production ZonesCore manufacturing and service providers 5Skill-intensive production centres 4Service and rural production centres 1Old manufacturing centres 9Peripheral RegionsLow populated peripheral regions in rich countries Structural inertia/de-industrialising regions 1Rural low populated regions


France (metropolitan): 21 regions belong to 6 types

VARIETY IN INNOVATION SYSTEMS

-1

1

3

5

7

9

11

13

15

Tertiary educational att.

Students in tertiary edu.

Business R&D (% GDP)

Government R&D (% GDP)

Higher Education R&D

(% GDP)

Patents PCT (million

inhabitants)

High-technology employment

GDP per worker

Inno

vatio

n in

dica

tor i

ndex

(OEC

D m

edia

n =

1)

Germany- intra regional variation

OECD - intra regional variation

Baden Wurttemburg

Mecklenburg-Western Pomerania

OECD Median= 1

46.58 top OECD value

-1

1

3

5

7

9

11

13

15






(% GDP)


inhabitants)


GDP per worker

Inno

vatio

n In

dica

tor I

ndex

e (O

ECD

med

ian

= 1)

USA - intra regional variation


Massachusetts

Mississippi

OECD Median= 1

46.58 top OECD and USA value

Germany:Baden-Wurttemberg and Mecklenburg-Western Pomerania

United States:Massachusetts and Mississippi

-1

1

3

5

7

9

11

13

15






(% GDP)


inhabitants)


GDP per worker

Inno

vatio

n In

dica

tor I

ndex

(OEC

D m

edia

n =

1)

South Korea - intra regional variation


Chungcheong Region

Jeju

OECD Median= 1


-1

1

3

5

7

9

11

13

15






(% GDP)


inhabitants)


GDP per worker

Inno

vatio

n In

dica

tor I

ndex

(OEC

D m

edia

n =

1)

Portugal - intra regional variation


Lisbon

Norte Region

OECD Median= 1


South Korea:Chungcheong and Jeju Regions

Portugal:Lisbon and the Norte Regions

VARIETY IN INNOVATION SYSTEMS

A KEY REGIONAL ASSET: HUMAN CAPITAL

0

10

20

30

40

50

60

0 20,000 40,000 60,000

% o

f lab

our

forc

e w

ith t

ertia

ry e

duca

tion

2007

(Re

gion

s, T

L2)

Regional GDP per Capita, 2009 US$ constant PPP, constant 2000 prices

USA (States)

Canada (Provinces)

Germany (Regions)

Mexico (States)

Spain (Regions)

Other OECD Regions (20 countries)

Note: The District of Columbia (US) does not appear in the chart for ease of display. Its GDP per capita (over USD 130 000) is more than double the value of top OECD regions. Source: Calculations using data from the OECD Regional Database.

GDP per capita and skilled labour force intensity: a virtuous relationship

VARIETY IN R&D FINANCING MODELS ACROSS OECD REGIONS

0

10

20

30

40

50

60

70

80

90

100

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0

Shar

e of

bus

ines

s inv

estm

ent o

n to

tal R

&D

ex

pend

iture

, 200

7-TL

2 Re

gion

s

R&D investment as % of GDP, 2007 Regions TL2

USA (States)

Germany (Regions)

Canada (Provinces)

South Korea

Other OECD Countries (TL2 regions)

BUSINESS-LED R&D MODEL

PUBLIC DRIVEN R&D MODEL

Massachusetts

Capital Region

Baden-Wuerttemberg

OECD Average

New Mexico

Maryland

Berlin

KansasNevada

Source: OECD Regional Database.

BETWEEN AND WITHIN COUNTRY HETEROGENEITY IN R&D EFFORTS

R&D as % of GDP TL2 regions, 2007 (or latest available year)


REGIONAL NETWORK OF CO-INVENTORSGREEN PATENT APPLICATIONS

Hokuriku (Japan), Baden-Wurttemberg (Germany) and California (US), 2005-2007


IDENTIFYING POLICY MODELS

• Policy question: how to prioritise between various possible regional policy objectives ?

• Answer: identifying typical policy models - and associated policy instruments portfolios (traditional, emerging, controversial) – away from the “supply-matching-demand” model, achieving a balance between knowledge creation-absorption-diffusion :

• “Entrepreneurial” model• “Node in global hub” model• “Absorptive capacity” model• “Innovation ecosystem” model• “S&T co-generation” model•…

POLICIES VERSUS POLICY MIXES

Components of a “constructed” policy mix Framework

RIS Characteristics

Broad Policy Objectives

Policy impacts

RDTI policy instrument

R&D policy instrument

R&D policy instrument

RDTI&D policy instrument


RDTI policy instrument RDTI policy

instrument



Other policy instrument




Other policy instrument Other

policy instrument

Governance

European

Source: www.policymix.eu

NationalRegional

DESIGNING AND IMPLEMENTING SMART POLICY MIXES

Knowledge Generation Knowledge DiffusionKnowledge Exploitation

Traditional instruments

Technology funds, R&D incentives/supports/grantsSupport to scientific research and technology centres, Support to infrastructure developmentHuman capital for S&T

Science ParksTechnology Transfer Offices and schemes, Technology brokersMobility schemes, talent attraction schemesInnovation awards

IncubatorsStart ups supportinnovation services (business support and coaching)Training and awareness-raising for innovation

Emerging Instruments

Public private partnerships for innovationResearch networks/poles

Innovation Voucher Certifications/accreditations

Industrial PhDsSupport to creativityInnovation benchmarking

Competitiveness polesCompetence centres

New generation of scientific and technological parks and clustersVenture and seed capital

Guarantee schemes for financing for innovation

Controversial instruments

Cross-border research centres

Open source-Open science Markets for knowledge

Regional Industrial Policy;Innovation oriented public procurement

Synergies between policy instruments and between policy areas

Balance within a policy mix: targeting firms and systems, local and global dimensions

Horizontal coordination


Land-Use ZoningTransportation

Natural Resources

Building

Renewable Energy

Waste and Water

0

1

2High impact

Medium impact

Neglible impact

Climate change policy packages

Source: OECD (2009), “Cities and climate change” Working Paper

SEEKING POLICY COMPLEMENTARITIES

EVALUATION TO BE DEVELOPED

• Traditional performance indicator benchmarking– Regional Innovation Scoreboard type indicators– Need to develop metrics for broad innovation

• Lack of policy indicators (intensity , direction)• Evaluations of individual programmes necessary…• … but evaluation of policy mix rarely performed• Evaluations of actors promoting innovation

– Innovation agencies , intermediaries and others

Need for more Strategic policy intelligence and improved capacities (in-house, outside)

TOWARDS « BORDERLESS » INNOVATION POLICIES FOR REGIONS

1. The need for borderless content of innovation policies

– “Hidden” forms of innovation, beyond R&D-driven innovation, should be stimulated through mixes of instruments from various policy areas: education, S&T, environment, infrastructure, etc.

2. The need for borderless territory for innovation policies

– Innovation does not stop at administrative borders: cross-border collaborations in policies are called for to target functional areas

– RIS are not “small NIS”: complementarities need to be ensured between policies and instruments at various levels

SUMMING UP:

THREE KEY ARGUMENTS FOR MORE EFFECTIVE INNOVATION POLICIES IN AND FOR REGIONS

1. Variety in innovation policy models

2. Openness (content, space) of policies

3. Policy learning and experimentation

WIRE: Week of Innovative Regions in Europe Granada, 15th-17th March 2010 Claire Nauwelaers...

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