Can small regions construct regional advantages? The case of four Norwegian regions

Abstract

The conceptual framework of constructing regional advantage (CRA) is implicitly relevant for large, well-off regions that have strong regional innovation systems, a diversity of industrial sectors and resourceful firms that can partake in global knowledge networks. This paper discusses the extent to which small regions, with less developed regional innovation systems, may also constitute the basis for developing regional advantage. Four cases of regional industries dominated by different innovation modes make up the empirical test bed in the paper. The innovation modes are STI (Science, Technology, Innovation), CCI (Complex, Combined Innovation) and DUI (Doing, Using, Interacting). The CRA framework is found to represent a useful conceptual construct also for small regions provided some reformulations. Adapting the CRA framework to small regions involves focusing more on increasing the innovation capabilities at the firm level, placing less emphasis on the endogenous capacity of regional innovation systems -but emphasising the importance of experience-based knowledge in local labour markets -and concentrating more on the need for diversity of knowledge bases at the regional level. Policy lessons for constructing regional advantage in small regions should, in general, consider the upgrading of DUI-firms and stimulating extraregional links.

Innovation Policies for Regional Structural Change: Combining Actor-Based and System-Based Strategies

“…The regions are often dominated by SMEs in traditional and resourcebased industries, which sometimes co-exist with larger, externally owned firms (Tödtling and Trippl 2005). In particular the SMEs operating in this RIS type and industries are often characterized by the DUI (Doing, Using, Interacting) mode of innovation (Jensen et al 2007, Isaksen andKarlsen 2013) that is based on experience and competences acquired on the job as employees face new problems or demands. The external ownership in some thin RIS may lead to a 'branch plant culture' that is hampering local entrepreneurship and innovativeness (Petrov 2011).…”

“…Rather than focusing only on the industry-or RIS level (system-based strategies), innovation policy in thin RIS should therefore also be directed at the firm level (actor-based strategies). Isaksen and Karlsen (2013) point out that some resourceful firms in thin RISs might act as 'door openers' to external knowledge for other local firms, while Monsson (2014) proposes to target high-growth firms from a variety of industries. From these arguments it follows to place less emphasis on the endogenous development capacities of regions but rather target specific firms that have the ability and willingness to innovate, to support their innovation process and foster the diffusion of competence and technology from the 'target firms' to other local firms and organizations.…”

Industrial specialization and economic performance: A case of Czech microregions

“…These authors argue that small regions are characterized by comparatively lower employment density, weaker local competition, smaller local markets, smaller supplier and knowledge bases, fewer local authors, and thinner regional innovation systems (for characteristics of thin regional innovation systems see Tödtling & Trippl 2005;Isaksen & Karlsen 2013). Together, these characteristics translate into the regions' typically limited endogenous innovation potential (North & Smallbone 2000), dependence on external demand and external knowledge sourcing (Isaksen & Karlsen 2013), and limited ability to capitalize on knowledge spillovers resulting from the technological relatedness of local industries (Onsager et al 2007). Small regional economies are usually more specialized and manufacturing often tends to be a leading sector (Henderson 1997).…”

“…Small regional economies are usually more specialized and manufacturing often tends to be a leading sector (Henderson 1997). As long as public and corporate research and development (R&D), high-quality universities, and highly-skilled labour are heavily concentrated in large metropolitan areas, there are usually less favourable conditions for the development of science-based industries, an analytical knowledge-base, and scientific and technological innovations in small regions (Isaksen & Karlsen 2013).…”

Structural Changes in the Economy of the Russian Northwest: Spatial Dimension

“…For instance, D. Doloreux [12], K. Onsager [18], A. Isaksen and J. Karlsen [14], D. Baumgartner [11], and S. Virkkala [20] stress the low density of economically active population, weak interregional competition, small local market, and a narrow knowledge base. F. Tödtling and M. Trippl also emphasise a 'thin' regional innovation system.…”