Fernando de la Torre Cuevas (p), Michael L. Lahr

Hidekazu Itoh

Subnational economic development has at least three dimensions: time, space, and industry. Time is required for economies to develop following a sequence that goes from entrepreneurial discovery— either private, public or combined— towards structural change. Space is less obvious, but fundamental to regional science. Spatial interactions may influence economic development in two different directions. On the one hand, geographical, cultural and idiosyncratic proximity favour interactions among agents yielding more intense economic and knowledge exchanges. On the other hand, capabilities sustaining economic development are not necessarily deployed and contained within strict regional boundaries. Regions influence each other by means of spatial spillovers and feedback effects caused by investments, trade, consumerism, commuting behaviour, etc. Analogously, inter-industry connections are also likely to facilitate exchanges between firms and territories. They can be expressed in input-output analysis parlance or supply chains in the field of logistics. Other industry-based agglomeration economies can also attach, springing up as other establishments and/or people locate within the same spatial sphere.

Literature has progressively incorporated interaction between territories and agents as an explanatory variable for regional economic development. Supply-push models— typically focused on research and development (R&D) expenditures— have been complemented with concepts provided by evolutionary economics. As a result, regional innovation systems (RIS) and smart specialization strategies (S3) have emerged as highly related and fertile theoretical frameworks. In the aftermath of the financial crisis (2008-2010) the European Union (EU) decided to put some of these new concepts into practice. As a result, EU’s regional policy for programming period 2014-2020 was designed following RIS and S3 recommendations. Inter-regional and inter-agent (i.e.: inter-industry) collaboration was particularly emphasised. EU also started to collect data allowing for RIS and S3 concepts and indicators to be quantitatively measured. Once this programming period is over, examining to what extent spatial and industrial interactions affected region´s economic performance becomes appears as an interesting research question.

In this paper we examine economic development across the 240 regions covered by the EU´s regional innovation scoreboard dataset between 2014-2021. We measure economic development in terms of growth (value-added) and efficiency (productivity) for each region and industry. We test four different model specifications for each dependent variable: (1) considering only R&D intensity and path dependence, (2) incorporating selected regional innovation scoreboard indicators as proxy of regional specific capabilities, (3) incorporating spatial spillovers and (4) incorporating industrial spillovers measured through agglomeration economies and input-output linkages.

Liran Maymoni (p), Raphael Bar-El

Fernando de la Torre Cuevas

Startups are typically more concentrated in major urban centers, while their presence in peripheral regions is relatively scarce. This study aims to identify the factors that may contribute to this phenomenon in order to inform policy efforts to promote innovation in peripheral regions. Our hypothesis is that startups located in peripheral areas have unique characteristics and that their reliance on factors of the innovation ecosystem differs from startups in central regions.
To test this hypothesis, we surveyed 173 startups, 105 of which were located in the metropolitan center of Tel Aviv in Israel and 54 of which were located in peripheral regions. The questionnaire collected data on the typology of the startups, including characteristics such as the degree of radical or incremental innovation, open or closed innovation, and whether they operated in a "blue ocean" or "red ocean" market. In addition, interviewees were asked to rate on a scale of 1 to 5 the importance of various factors of the ecosystem for their startup.
Initial analysis using a logit regression suggests that certain types of startups are more likely to be located in peripheral regions. We also examine the relative importance of various ecosystem factors for different types of startups, comparing startups in peripheral and central regions. The results of this analysis may provide valuable insights into effective policy measures to attract specific types of startups to peripheral regions.

Qiang Cao (p), André Torre, Maryline Filippi

Liran Maymoni

The idea that international pipelines significantly impact local innovation systems embedded in the global value chains (GVCs) has gained widespread academic agreement. Product innovation is a complex, non-linear process that requires knowledge from various departments within a product chain. However, two common gaps exist in most empirical studies: the relationship between different pipelines outside the innovation system, and the impact of pipelines on the knowledge network within the innovation system. This paper examines how international pipelines impact the local innovation systems in the tomato breeding industry in China, based on three pipelines and departments of the product chain: research and development (R&D), production, and market. It examines the spatial and organizational impact of pipelines on knowledge networks of innovation systems on a city-by-city (cluster-by-cluster) basis, using imports, patents, and actors data from 2010-2021. It especially addresses three questions: 1) What are the relationships and characteristics of international pipelines? 2) What are these pipelines' impacts on transfer performance of the local innovation systems? 3) How do these pipelines influence the knowledge network of local innovations system? The study reveals that the R&D pipeline is closely related to the market pipeline, while the production pipeline is relatively independent. The R&D and production pipelines have positive impacts on the performance of local innovation systems, while the market pipeline has a negative impact. Furthermore, international pipelines hinder connections between actors within and between the local innovation system. We applied the proximity theory to explain the impact of pipelines on the knowledge network. Our findings provide new evidence and insights into the non-linear models of the local innovation system and international business, and offer policy implications for catch-up industries deeply embedded in the GVC.

Hidekazu Itoh (p)

Qiang Cao

The first globalization started with the invention of the steam engine by the Industrial Revolution. With the advent of steamships, regular shipping routes became possible, and the cargoes transported expanded from high value-added products to low value-added products. However, the introduction of steamships was not so simple, and in the early years (19 century) they served only as a supplement to sailing ships, which were called “steam-sailing ships.” Furthermore, since the Edo Shogunate (bakufu) (1603-1867) adopted a policy of national isolation until the end of the 19th century, maritime transportation in Japan was exclusively domestic coastal transportation except some exceptions. Therefore, until the end of the Edo (early modern) period, Japanese-style ships, which were suitable for coastal transportation, were exclusively used instead of Western-style sailing ships. From the end of the Edo period to the Meiji Restoration (1867-, modern period), the introduction of Western-sailing ships, “steam-sailing ships,” and steamships (and steam locomotives) from overseas changed the structure of domestic cargo transport. In addition, the ships, called as “Ainoko-bune,” that combined the advantages of Japanese and Western-style sailing ships were developed and used for domestic transportation. Then, the diffusion of technological innovations within Japan was more complicated. In this research, between 1744 and 1907, using custom registers by wholesale shipping agents in port cities that thrived on coastal shipping, we observe how changes in shipping technology affected trading partners (or regions) and the items they transported. The advantage of this study is that it takes up an area where steam locomotives, which were being introduced in Japan during the periods, were not opened due to geographical factors during these periods, allowing us to examine the effect of “pure” ship technology in that port city.