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Regional development

Broadening Innovation Policy: New Insights for Cities and Regions

 

To ensure that technological and knowledge diffusion reaches all types of regions a broader approach to innovation policy might be required. There is an increasing body of evidence that weaknesses in technology and knowledge diffusion in the OECD are weighing on productivity growth and innovation, particularly in firms that are distant from the technological frontier (whether global or national). This weakens the capacity of OECD countries to adapt to meet future challenges and undermines inclusive growth. It is therefore necessary to examine whether current tools for innovation policy are too narrowly focused, targeting mainly research and development as well as science and technology-based interventions. To empower firms in all types of regions to benefit from global trends and technological change, a broad‑based innovation policy also needs to flexible enough to adapt to the different capacity and innovation eco‑systems in different regions and cities.

To deepen the understanding how OECD countries can move towards a broad‑based form of innovation policy the OECD worked with the European Commission’s DG for Regional and Urban Policy in bringing together academic and policy experts in a series of five high‑level expert workshops on  “Broadening innovation policy – New insights for regions and cities”. For each of the workshops two background papers were prepared by experts in the field. The first paper summarises the academic frontier thinking on the topic, the second practical policy examples.

The key results and recommendations will be distilled in an OECD report that will be launched in 2019.

 

EC innovation seminar series

 

1. Fostering Innovation in Less-Developed Regions 

Despite large regional disparities and in many countries widening gap between well-performing and those regions lagging behind, countries’ innovation policy mixes have remained quite homogeneous, with region-specific policies accounting for only 0.71% of the reported budgets. Innovation policy in less-developed regions needs a broader approach, considering factors that act as framework conditions for innovation diffusion and approaches that builds and elaborates niches and local strengths. Policy need to consider institutional capacity building, as some regions lack strong institutions, good governance and political goodwill, all thought to be essential for innovation to “trickle down”. Beyond institutional factors, public action may need to take other aspects into account.

Background papers by experts:

agenda icon KEY QUESTIONS

agenda icon WORKSHOP AGENDA

 

2. Building, Embedding and Reshaping Global Value Chains 

The increasing importance of global value chains (GVCs) has transformed not only global trade, but also the way companies act and produce. GVCs are sometimes considered to be creating new or to be aggravating previously existing market-failures, which – if true – would call for policy action. GVCs present new opportunities as new dimensions for competitive advantage may emerge as well as the possibility to onshore “lost” activities as technology reshapes cost structures within the value chain. It is therefore important to understand better the dynamics of value chains and the relationship between different functions in the production process from knowledge creation to scale-up and commercialisation of new products.

Background papers by experts:

agenda icon KEY QUESTIONS

agenda icon WORKSHOP AGENDA

 

3. Developing Strategies for Industrial Transition 

Regions in industrial transition often face large challenges, and even more so when they have weak institutional capacities, fragile industrial links, or a low-skilled workforce. These regions may be unable to attract sufficient investment to encourage innovation, or commercial research structures and firms that could contribute to industrial modernisation. Given these challenges, it could be argued that regional innovation policy could be broadened, assuming a more active role in encouraging and facilitating innovation through the diffusion and commercialisation of knowledge that support transition.

Background papers by experts:

 

 

 

agenda icon KEY QUESTIONS

agenda icon WORKSHOP AGENDA

 
     

4. Managing Disruptive Technologies 

Radical inventions have profound impacts on firms, industries, markets and regions. They have the potential to move markets away from existing practices, introduce new paradigms and open up avenues for further technological developments. A number of new technologies are considered to be about to generate a “new production revolution”. The technologies are in part digital technologies, but also new materials, as well as new processes, e.g. artificial intelligence and their combinations. As these technologies introduce new paradigms, firms and regions that do not keep up with the pace of innovation risk falling behind. This is not only the risk for innovative regions, but for all types of regions.

Background papers by experts:

agenda icon KEY QUESTIONS

agenda icon WORKSHOP AGENDA 

 

5. Experimental
Governance

Regional development policy and innovation policies require experimentation, trying out new processes, ideas and structures. Experimental governance involves a process of provisional goal setting and revisions based on lessons drawn from regional experiences and from “learning by doing”. Experimental governance also implies using digital government tools and information technology in an effective way. However, such an approach may not necessarily work for every type of region, especially when considering different levels of institutional capacity and socio-economic framework conditions. In particular, it is necessary to balance experimentation with the need to ensure accountability and to address fiduciary concerns.

Background papers by experts:

agenda icon KEY QUESTIONS

agenda icon WORKSHOP AGENDA

 

Launch
Event

Details to come.

 

 

  

Wish to contact us?

For further information or comment, please contact Alexander C. Lembcke (alexander.lembcke@oecd.org).

 

 

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This project was produced with the financial assistance of the European Union.

 

 

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