Regional Innovation Systems - An Analysis of Innovation Policy Instruments

MA-Thesis / Master von Michael Bison

Abstract:

Innovation is essential for the competitiveness of companies within the globalised knowledge economy. In the actual situation of high unemployment rates in most western countries public economy support works thereby actively on the improvement of innovation activity conditions.

The regional level is for this attempt the most interesting spatial entity because of its high significance in global economic mechanisms. The questions motivating this master thesis are how regional innovation policy can improve a regional innovation system and which of the possible policy instruments the most effective ones are to combat unemployment.

Innovations are the new combination of recent or established knowledge, whose implementation had a noticeable effect on the performance of the organisation, it was implemented in. This includes product, process, organisational and people innovations. Innovations are not anymore an individual effort but a process which involves many actors and institutions. The basis for the exploration of how to support the development and implementation of these innovations is the regional innovation system approach. It divides the innovation process into phases and their linkages and allows identifying analytically the evolved actors and the weaknesses of the innovation process.

The analysis of innovation policy instruments assigns each weakness within the innovation process an instrument which is explained and analysed in detail. The examined instruments are competence centres, start-up centres, science parks, networks, regional knowledge management and diffusion agencies. Each instrument’s function and its main characteristics get described together with a best practice example, which leads to a conclusion on its effects on innovation and employment.

The result of the analysis is that competence centres, start-up centres and science parks are central instruments and have the highest potential for employment effects. Networks, regional knowledge management and diffusion agencies are more supporting measures that improve the performance of the first three. For the success of all instruments, their combination with each other and the utilisation of synergies and dependencies between them is essential. A holistic concept including all instruments is the most effective way to support regional innovation processes.

These findings get transferred to the case study region Bonn where, as an example for an innovation process weakness, the knowledge transfer from science to economy is analysed. For the application of each innovation policy instrument is important to use existing organisations and potentials and work within the grown regional structures.

Table of Contents:

Table of Contents:

Text Sample:

Chapter 4.2, Start-up centres: he support of new company foundations (start-ups, spin-offs and spin-outs) is an important measure to foster the implementation of innovation and thereby to improve the employment situation of a region. The aim is to help small companies in the first phases of company development. The very common instrument of regional economy promotion policy is called start-up centre.

Behrendt defines a start-up centre (SUC) as amostly public institution run by the local or regional business development. In them selected, relative new and mostly newfounded companies should be supported, whose business activities are mainly oriented on the development, production and marketing of technological new products, processes and services.

The support has a limited time and contains a supply with rooms for rent, common facilities and counselling services. This definition is used also in this master thesis. The terminology for SUCs is not fixed and no precise definitions have been made in German language. Therefore a wide variety of names for these institutions exists. Technology-factory (Technologiefabrik), business incubator (Existenzgründungszentrum), synergy-centre (Synergiezentrum) etc. The latest development is the introduction of the term innovation in the word creations because of its significance for new companies and regional competitiveness.

The German Association of Innovation-, Technology- and Start-up-centres (ADT) sums up the variety of institution names under the term Innovation-centres (Website ADT). Following the term start-up centres (SUC) will be used because the main function of these institutions is the support of new companies and the effect of these measures are in focus of this chapter.

Main problems of start-up companies are to manage the market entrance, organise financial sources, the acquisition of qualified employees and business administration related or technical problems.

Telephone centre, conference and meeting rooms and fax and copy machines are in nearly every SUC present. This kind of physical infrastructure is easy to provide and help the new companies to save the costs of purchasing those instruments themselves. Other equipment and performances are only in some SUCs available depending on local actors and associates, financial resources (depending on political and business support) and the demand structure of the start-up companies.

Help to acquire financial resources is especially for innovation oriented start-up companies relevant because they have a high need for risk capital and often big problems to activate this. The choice of services provided should depend on the availability of similar services elsewhere in the region. In some cases business incubators have been established precisely to supply those services lacking in a given location (OECD 1999). But the purchase of specialised equipment does only make sense for the SUC if the demand of manycompanies justifies it. This raises the question whether SUCs should have a selective choice for start-ups and focus on one technology branch or if it should aim on a technology mix.