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These include management accountants, venture capitalists, patent lawyers and so on.

Even knowledge-intensive business services for farming are located in cities where insurance, credit and technical talent is found, rather than in the rural markets for such services. But KIBS are a very large platform of differentiated knowledge, which returns us, momentarily, to the question of geographic proximity. Clearly, the phenomenon of rural services being supplied from metropolitan locations reveals how the presence of global talent pools, their knowledge spillovers, and relatedness across industry boundaries allows for fluid entrepreneurial activity to be conducted in an urban ecosystem by KIBS of many sizes.

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Ironically, indicators of such knowledge-intensive entrepreneurial concentrations place cities like Stockholm and London at the peak of the European hierarchy for their disproportionate shares of employment in KIBS and the lesser category of high-tech manufacturing Cooke and Schwartz , but they also show London, at least, to underperform UK regions on innovation per capita Chapain et al.

So, it seems likely that knowledge-intensive entrepreneurs are located in different places than innovators. More precisely, most KIBS and high-tech manufacturing workers in cities are clearly neither entrepreneurs nor innovators. Rather, they are clerical, secretarial, retail and administrative workers, which corrects the discourse that emphasises the creativity of large cities, at least regarding the composition of their labour markets.


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From this research on cities, we conclude that entrepreneurs are increasingly divorced as actors and in geographical terms. This is a source of the difficulty innovators have in launching new start-up businesses, especially in Europe. This is possibly the most interesting question posed by the EEG research.

Nowadays, that research is criticised in favour of a more open and innovation-friendly perspective Martin Martin and Sunley thus align this adjusted perspective on path dependence to another key EEG concept, namely proximity. This shift towards a mobilisation explanation for innovation, when linked to the multi-level perspective idea of co-evolving socio-technical systems, allows us to incorporate the key complexity theory concepts of preadaptation and the adjacent possible in a rather satisfactory explanation of emergent regional knowledge flows and innovation.

Foreign Workers Are Associated with Innovation, But Why? International Networks as a Mechanism

Allowing for the likelihood of market failure by firms which do not explore regional paradigm relatedness sufficiently, thereby delaying the onset of new path creation, opens up regional regime opportunities for government or governance organisations to introduce firms to both regional and non-regional innovation as a preadaptive form of transversality and to encourage exploration of structural holes or white spaces among regional paradigm elements Burt ; Johnson Thus, we begin to see more clearly the element of path interdependence that defines key spatial forces underlying and influencing inter-organisational relations.

The innovator recombines knowledge while the entrepreneur assembles the financial, legal and human resources to commercialise it. EEG and other research shows the strength of this region in Sweden to be clustered in agro-food production and services, including functional food based on biotechnology applications, like health drinks, and organic food offered in farms, public canteens and restaurants, as well as conventional mass production using industrialised productivist chemicals, pesticides, fungicides, herbicides and other conventional control technologies.

Policy may be active when market failure means that potentially complementary firms or industries in geographical proximity never meet to discuss possible innovations.

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By early , the western harbour area had been reinvented as a centre of cognitive-cultural activity by the media. An emergent clean-tech industry and a systems resilience initiative were also beginning to be visible.

This area prioritised regional paradigm resilience while the next regional account, also from Sweden, emphasised regional regime resilience aspects. This resilience shock Gunderson and Holling ; Folke led Sony Ericsson to reduce shipments of hardware and refocus on managing global services, such as selling network services to mobile telephone suppliers, including Telenord and Telia.

To the latter, they also sold the extra service of managing the network, leaving the client to simply manage billing and cash flow. Accordingly, Telia began cutting employment in the mids and has not filed more patents. ST Ericsson, the telephony infrastructure arm of the Ericsson Group, seemed unlikely to survive as a stand-alone company, and Sony Ericsson, the Ericsson mobile telephone joint venture, was dissolved.

This augmented their offices at Kista Science Park in Stockholm, and Gothenburg, to employ engineers. Huawei took advantage of cutbacks by Ericsson in Lund, which had made hundreds of qualified engineers available. The range of Huawei manufactures increased from base stations to mobile Internet modems and its own telephone handsets.

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Resilience theory from EEG promises a response to resilience shock, so what was the regional and firm response to these perturbations? On the regional level, an emergent clean-tech industry Sustainable Hub and a systems resilience initiative Training Regions began to become visible around Even S. Lateral linkages were also in position with the Media Evolution Nordic Game cluster member.

It promoted the emergence and growth of start-ups in relevant fields.

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TAT, purchased in by Research in Motion, was started in This was a pioneer user of novel social media forms like crowdsourcing Shirky and crowdfunding of anything from film projects to start-ups. Accordingly, crowdsourcing was another open innovation response to global, corporate competitive forces impinging on large Swedish ICT incumbents. Another cross-sector media-ICT innovation link included Qubulus, a system platform for indoor positioning on which location based services could be developed by Qubulus or by an application developer community through a shared application programming interface.

The platform aggregates positioning input from proprietary web services and mobile apps to hardware installations.

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By using the best technology to fit the usage and purpose of the customer case, Qubulus can meet user demand and solve the problem of indoor positioning. Crowdsourced positioning activities are a focus in designing space syntax for people flows, shopper movements in retail malls and product finder smartphone applications.

A strategic decision was taken to concentrate initially on meeting the Europe Grand Challenges of Climate Change and Healthcare. This meant focusing on iconic projects committed to innovation, learning and collaborative platform management laboratories see fig. Thus, the particularisation of the Climate Change Grand Challenge involved translating it into a sustainable cities initiative triggered by a large infrastructure commitment to a new tunnel, which brought together numerous regional clusters involved in renewable automotive fuels, forest plastics, petroleum and health.

At a more detailed level, these assembled pilot projects mixed expertise in cluster firm logistics, public transport, visioning computer graphics and imaging and green accounting. A comparable iconic project approach was taken in healthcare, and the project in question involved a new health complex centred on a Medical Health Imaging Facility at the University Medical School. This connected transversally to digital signals processing data compression and medical diagnostics engineering expertise at Chalmers University and one of its spinout firms, Medfield Diagnostics.

The interest here is in an economically strong but over-specialised region that has a narrow path dependence paradigm composed of agro-food, aerospace and healthcare with biotechnology inputs, but a strong regional regime that emphasises transversality as a policy model. Chart 2 represents a process diagram of the regime methodology for inducing transversality from the regional paradigm in a strong way. This led to two parallel exercises. The first, CAVALA, was a statistical review of the strengths and weaknesses of the main clusters and leading firms with respect to innovation and innovation potential.

This led to recognition that, in effect, only two types of existing and established firms were likely to be good innovation candidates: lead firms, like EADS and Thales in aerospace, and hub firms or firmes pivots, which are important systems integrators or aggregator firms in supply chains. To these were added innovative spin-out or start-up businesses. Leading candidates from agro-food, aerospace and bio-healthcare were then put in a transversality group to consider methodologies, incentives and conventions by which they might proceed to talk across sector and cluster boundaries, known to be an especially difficult task where tacit knowledge is concerned Janowicz-Panjaitan and Noorderhaven In these group discussions, the key focus was on technology, its known properties and cross-pollination potentialities, barriers to innovation from cognitive research or resources and, as noted, methodologies by which firms might find each other, despite their apparent un-relatedness, in order to generate regional innovation through the exploitation of relatedness.

This is a new, French, top-down model that seeks to induce innovation by a formal imposition of the conventions of transversality on regional firms. Between March and June , we researched innovation in Portugal at both national and regional levels Algarve, Centro and Norte regions. Were regions sacrificing valued industries to promote smart specialisation? Was the idea even understood?

And how, after the Commission was criticised for its linear, sectoral and specialisationist approach so that it had to propose in footnotes that related variety and DUI-type innovation were also examples of smart specialisation did its regional and national clients manage the resulting confusion Kroll ? This proved to be an interesting laboratory for observing multi-level governance tensions, from regional to national to supranational levels of interaction. The context is unique in that a slow-moving, cumbersome and—as many see it—spatially myopic and conceptually chaotic European Commission belatedly sought to induce a new, post-program budget and linear regional economic development model to promote growth while imposing major constraints in the form of austerity policy, budget cuts and draconian debt repayment conditions.

At its worst, the austerity strategy has massively impoverished Eurozone member Greece, and while Portugal emerged from the imposed fiscal straitjacket without the same devastating results, the hallmarks of contradictory thinking remain evident about how the EU believes it promotes growth by imposing conditions that ensure the opposite. In brief, the studied regions and even, to some extent, the state ignored the precepts of specialisation and pursued the common-sense potential of optimising their regional diversity to promote regional innovation Cooke These could be located outside Algarve if necessary.

However, it was a very horizontal set of aspirations. Centro and Norte already had high related variety scores, as judged by the Portuguese National Research Council FCT , so they used matrix methods to identify crossover innovation opportunities and projects in biotechnology, flexible manufacturing systems, robotics, renewables and footwear, among other intersecting innovation platforms.

In the last two cases, their strategies were accepted by the state, which retained control of project evaluation dependent on the EU Regional Operational Programmes into which RIS3 allocations fit. A better governance model for regional innovation was approved, but it was not a full-blooded regional innovation agency.

In its stead, diverse regions either sought to initiate or, where conditions were more evolved, consolidate growth opportunities and gains by adopting regional diversity through building on the concept of related variety and fashioning transversal innovation policies. That this was given approval in the RIS3 documentation promoting smart specialisation merely underlies the conceptual confusion and spatial myopia of the EU and its Commission.

This shows that the EU and even its member-states are slow-moving, backward-thinking policy action entities. Even weak regional administrations, such as those anatomised above, can respond and, in limited ways, even anticipate needed economic policy actions more swiftly. Algarve had great difficulty extracting its future innovation profile from the specialised sun and beach frame endowed upon it by its state and fellow regions.

The key problem lies in institutional failure by big, slow organisations, like the EU and member states, to leave their neoclassical industrial economic comfort zone and embrace the full meaning of innovation, which is recombinant, interactive and unconfined to a sector or even a cluster. Rather, innovation is geographical, interactive and based on crossover innovation at interfaces. The studied regions and even, to some extent, the state, ignored the precepts of specialization and pursued the common-sense potential of optimizing their regional diversity to promote regional innovation.

It is clear that the transversality perspective can be considered successful at path-breaking in three significant dimensions. First, the theoretical sophistication of its approach places its evolutionary economic geography approach in a primary position, from the viewpoint of advanced regional analysis.