KNOWLEDGE CREATION AND ABSORPTION: THE REGIONAL DIMENSION
Alessandro Sterlacchini
UNIVERSITÀ POLITECNICA DELLE [email protected]
KNOWLEDGE ECONOMY FORUM VII: “Technology Absorption by Innovative Small and Medium Enterprises”. Ancona, June 17-19, 2008.
Knowledge and economic growth
Broad consensus on the positive relationship between knowledge investments and economic growth
However, the linkage is far from being linear and cannot be taken for granted Countries and regions with different levels of
development cannot reap equal benefits from investing the same amount of resources in the same directions
Similar considerations apply to firms of different size
Knowledge and economic growth
To exploit the existing stock of knowledge for commercial purposes some enabling conditions must be at work Absorption capacity (human capital) Transmission channels (university-industry relations) Filtering mechanisms (entrepreneurship)
The above caveats emerge from many empirical studies and, especially, those concerned with regions (sub-national areas)
The regional dimension
Due to its tacit elements, knowledge is not easily transferable so that positive externalities are strongly localised
Accordingly, geographical proximity matters and the regional level is best suited for effective innovation policies
In the EU, regional policies are key instruments for implementing the Lisbon strategy
EU Regional Policy (Structural Funds) 2007-2013
Two objectives:
Competitiveness and employment: developed regions (GDP per capita 75% of the EU25 average)
Convergence : less developed regions (GDP per capita< 75%)
Empirical background
Sterlacchini, A., R. Esposti, N. Matteucci and F. Venturini (2005) Policy guidelines for regions falling under the new regional competitiveness and employment objective for the 2007-2013 period. Vol. I: Statistical analysis, Report prepared for the European Commission, DG Regional Policy.
Sterlacchini, A. (2008) R&D, Higher Education and Regional Growth: Uneven Linkages Among European Regions, Research Policy.
STUDY ON “POLICY GUIDELINES FOR COMPETITIVENESS REGIONS”
Knowledge and innovation indicators (R&D, patents, higher education, etc.) Factor analysis to obtain a synthetic indicator Identification of 3 regional groups (low, medium, high)
Economic performance indicators (GDP per capita level, GDP growth, rate of unemployment, etc.) Factor analysis to obtain a synthetic indicator Identification of 3 regional groups
Joint analysis of knowledge and economic performance indicators
Type and number of regions
KNOWLEDGE & INNOVATION
ECONOMIC PERFORMANCE
LOW
INTERME-DIATE
HIGH
LOW
Low performers
23
Unexploited potential
18
Strong unexpl. potential
10
INTERMEDIATE
Uncorrelated
23
Intermediate
33
Unexploited potential
13
HIGH
Strongly uncorrelated
7
Uncorrelated
24
High performers
17
KNOWLEDGE AND ECONOMIC GROWTH: analysis for all the regions of the EU15
Knowledge creation: intensity of R&D expenditures on regional value added
Knowledge absorption: share of adult population with tertiary education Note: in the EU the level of secondary education is not a suitable indicator of knowledge absorption
→ Economic growth: change in GDP per capita over 1995-2002
REGIONAL DIFFERENCES:
For the developed regions both the intensity of R&D and higher education are effective drivers of GDP growth
For the less developed regions only the extent of higher education is effective
GDP growth Vs. intensity of R&D
GDP growth Vs. intensity of Higher Education
COUNTRY DIFFERENCES (looking at developed regions only):
The joint impact of R&D and higher education on regional growth is not significant for Southern European Countries (Austria, France, Italy and Spain)
GDP growth Vs. intensity of R&D and Higher Education (developed regions only)
Inner London
Cumbria (UK)
North = Belgium, Finland, Germany, the Netherlands, Sweden, UK
South = Austria, France, Italy, Spain
Evidence for the regions of Central European countries
Replica of the previous exercise: R&D and higher education as drivers of regional GDP growth
Provisional results Limited country coverage due to the poor
availability of regional data: Czech Republic, Hungary, Poland and Slovak Republic
GDP growth Vs. intensity of R&D and Higher Education: Czech Republic, Hungary and Slovak Republic
GDP growth Vs. intensity of R&D and Higher education: Czech Republic, Hungary and Slovak Republic
The positive relationship is almost exclusively due to the performances of “central” capital regions (note: this does not occur in Western Europe)
To what extent the above relationship is “simply” due to agglomeration economies?
How to deal with this dualistic pattern of regional growth (central Vs. peripheral regions)?
GDP growth Vs. intensity of R&D and Higher education: Poland
GDP growth Vs. intensity of R&D and Higher education: Poland
For Poland, the relationship is not significant In this sense, Poland can be assimilated to
the Southern Countries of Western Europe Industrial specialization, FDI and
geographical proximity to EU markets probably play a greater role than knowledge capabilities
Concluding remarks and policy considerations
Remarkable differences across EU regions both in terms of knowledge potential and capability to exploit it
Too much emphasis on knowledge creation and research infrastructures could be ineffective; moreover, it could increase rather than reduce regional disparities
In the medium run, the less developed regions should pay particular attention to higher education, especially for improving the absorption capacity of SMEs
With some qualifications, the above considerations can be extended to the countries of East Europe and Central Asia
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