FINDINGS OF THE OECD REVIEW OF REGIONAL INNOVATION
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1 FINDINGS OF THE OECD REVIEW OF REGIONAL INNOVATION CENTRAL AND SOUTHERN DENMARK Karen Maguire Regional Development Policy Division Billund, Denmark 5 September 2012
2 Regional development policy and innovation at the OECD Regional Innovation and Territorial Reviews Thematic reports: clusters, regional innovation policy Country/region/city reviews at the request of governments Different levels of government seek policy advice: National governments that must support a diversity of region types (regional development, S&T, enterprise, higher ed) Regional and local authorities that seek the right policy mix Peer Review: Policy makers from other countries participate 2
3 Several trends in innovation practices and policy highlight the role of regions A double paradigm shift in policy regional development policy more focused on competitiveness innovation policy expected to have economic and social returns Trends in innovation Investments in intangible assets Innovation without R&D Complementarity of technological and non-technological innovations Convergence of scientific fields (multi-disciplinary/ interdisciplinary) Collaboration Firms that do so spend more on innovation than those that do not Patented inventions increasingly the result of collaboration, and increasingly with international partners Role of different forms of human capital 3
4 Some key challenges Central and Southern Denmark Context of continued lagging productivity growth in Denmark overall National GDP per hour worked about same as average for top 17 OECD countries in 1996 to -11% in 2010 Maintaining global competitiveness in areas of specialisation / clusters Labour shortages and skills mismatches: Future labour shortages projected overall Existing labour shortages for certain skilled jobs High school drop-outs increasingly a concern with fewer good lower-skilled jobs Peripheral areas, particularly on western coast, are losing population towards eastern side of peninsula and capital Cultivating, retaining and attracting innovation-related resources such as skilled workers, public R&D, innovation-intensive firms, etc. 4
5 Knowledge Hubs Knowledge-intensive city/ capital districts Knowledge and technology hubs Framework for analysis of Central and Southern Denmark Industrial Production Zones US states with average S&T performance Service and natural resource regions in knowledge-intensive countries Medium-tech manufacturing and service providers Traditional manufacturing regions Non-S&T driven regions Structural inertia or deindustrialising regions Primary-sectorintensive regions Type of region Institutional context Significant control of STI powers and or resources Some decentralisation of STI powers and/or resources No decentralisation but regional innovation strategies No decentralisation and innovation projects only Regional strategy Building on current advantages (science push / technology led or a mix) Supporting socio-economic transformation (reconversion or identification of a new frontier) Catching up: towards the creation of knowledge-based capabilities 5
6 Region type: national context Share of national total % 42.7% 20.3% 36.9% % Northern Denmark Zealand Central Denmark Southern Denmark Capital Region 0 Population (2009) GDP 2008 Contribution to growth ( ) Source. Calculations based on OECD Regional Database. Hours worked (2009) Higher educated labour force (2008) R&D expenditure (2007) R&D personnel (2007) Patents PCT (2007) 6
7 Region type: OECD context Regional performance relative to OECD regional median Source. Calculations based on OECD Regional Database. 7
8 Region type: OECD Context Peers include mainly Nordic, Dutch and Canadian regions Knowledge hubs Industrial production zones Non-S&T-driven regions Notes: These maps are for illustrative purposes and is without prejudice to the status of or sovereignty over any territory covered by this map. Maps may be cropped for ease of display. Eight different types of regional profiles, based on an analysis of 12 indicators in OECD regions with available data, were grouped into these three categories. Source: OECD (2011) Regions and Innovation Policy, OECD publishing. 8
9 Region type: actors in the system Common elements but institutional, geographic and sectoral differences Central Denmark Second-city effect of Aarhus University a magnet for students and national R&D funds Growth House used as hub for regional business support Southern Denmark Network of cities / sub-regional identity University accessible across region, but less able to capture public R&D funds Clusters are used in addition to Growth House for channelling regional business support Example sector: Food (larger firms with ability to invest in R&D) Example sector: Food (smaller firms in different fields) 9
10 Region type: some strengths and weaknesses in each region Recommendations Strengthen role of universities in terms of skills matching, research quality and R&D relevance Continue to stimulate private R&D and innovation investment Reduce unnecessary complexity when possible in the offer of different business and innovation support services Support integration of regional actors into global networks 10
11 Institutional context: role of partnerships Observations Fewer STI policy instruments than other OECD regions Steep learning curve for regions, and some leapfrogging Growth Forum in each region for public-private partnership Prominence of EU Structural Funds spending rules for regions Recommendations Collaborate more between national and regional governments through stronger partnership agreements Options include longer-term, budgets, inter-ministerial collaboration Build greater municipal-regional trust Promote more data and policy intelligence sharing, such as commonly accepted mappings/analysis of regional strengths Identify ways of reducing unnecessary administrative burden of EUrelated spending, notably for greater private sector involvement 11
12 Regional strategy: Focus and accountability Observations Successful consensus building on areas of priority Growth-driven focus of spending Increasingly productive dialogue with national government towards common goals Need to avoid duplication across Denmark Recommendations From data analysis to policy intelligence From funds use to impacts of investment Ensure prioritised sectors can effectively use funds when devoting large share of budget Greater harmonisation across Danish regions on data format, administrative practices, etc. Central Denmark Growth Forum spending Experience economy 11% Rural development 12% Internationalisation 7% Energy and environment 17% Entreprenurship and business development Education and 24% competence building Innovation 15% and IT 13% Clusters 3% Other 18% Experience industry 18% Welfare tech 31% Energy 18% Welfare/health technologies 4% Food 6% Rural development 3% Southern Denmark Growth Forum spending 12
13 Regional strategy: prioritised areas Observations Below the similar headlines, sectoral differences by sector Energy sector: recognised strengths Welfare technology more aspirational but some creative approaches Tourism used in part as solution to peripheral areas and low-skilled Recommendations Greater clarity on regional priority sectors on a global scale If pursing cluster policies, consider next generation approaches (cross-border and cross-cluster) More creative approaches to addressing peripheral and low-skilled than tourism (including through innovation in public services) Ensure that the policy mix promoted in each region pays sufficient attention to commercialisation and addresses non-st forms of innovation (user-drive, design, etc.) 13
14 In summary 1. Global relevance Critical mass within and across regions Positioning of regional specialisations/clusters 2. Addressing skills Cultivating, attracting and retaining high-skilled workers Removing the growth bottleneck of low-skilled workers 3. Clarity on growth targets Strategic approach to peripheral areas Growth drivers and rest of the economy 4. Partnership model to achieve regional goals With national, regional and local governments Increasing private sector involvement, including unusual suspects to trigger new ideas 14
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