News from the IPL
INTRODUCTION
This newsletter is published by The Innovation Policy Lab at the Munk School of Global Affairs, University of Toronto, and sponsored by the Ministry of Research and Innovation. The views and ideas expressed in this newsletter do not necessarily reflect the views and policies of the Ontario Government.
ANNOUNCEMENTS
Innovation Campuses: Midwestern Colleges Launch Campuses Built on Public-Private Collaboration
Public research universities have long had ties to state industries, and technology transfer is widespread in higher education. But of late, some colleges are concentrating these efforts on so-called innovation campuses. There’s Kansas State University’s Olathe Innovation Campus, which was funded with a county sales tax and built on land donated by a municipality in the Kansas City suburbs. Just across the state line sits Missouri Innovation Campus, which is being built by the University of Central Missouri and has the enthusiastic support of Democratic Governor Jay Nixon. The campuses differ in specialty, size and scope. But the intentional cohabitation of academics and industry is key to all of them, something university leaders say made the ambitious and expensive projects palatable to legislators and voters even as the economy and higher ed appropriations shrunk. Kansas State opened the first building on its 38 acres of prime suburban real estate last spring. The International Animal Health and Food Safety Institute was designed to bring K-State’s research expertise in those fields to business leaders in Kansas City.
Invest Ottawa to Bolster Economic Development
Mayor Jim Watson recently joined co-chair Jeff Westeinde and local entrepreneurs to officially open Invest Ottawa, the flagship of the City’s $5.5-million annual economic development strategy. Invest Ottawa, which replaces the Ottawa Centre for Regional Innovation (OCRI), will foster start-up enterprises, attract new investment, and help existing businesses located in Ottawa expand beyond our borders. While OCRI was established in 1983 to leverage the emerging high-tech industry, the development of Invest Ottawa re-focuses the organization on further developing knowledge-based sectors such as green energy, defence and security, photonics, digital media, film and television, and life sciences.
Canada’s Small Businesses Get a Boost
CANARIE, Canada’s Advanced Research and Innovation Network, recently announced the findings from the DAIR pilot program and seeks input from Canada’s digital entrepreneurs on the next phase of the program. The DAIR pilot program was launched in spring 2011 and hosted over 40 users. As part of the wrap-up of the pilot phase of the DAIR program, CANARIE surveyed those users who cite the speed, scalability and security of the program as its biggest benefits. DAIR is a testbed environment in which small and medium-sized enterprises (SMEs) in the high-tech sector can design, prototype, validate and demonstrate pre-commercial technologies faster and cheaper than ever before. In the pilot phase of the program, there was no charge to users of DAIR.
Editor's Pick
ISRN Symposium at the 2012 AAAS Conference
Three distinct but interrelated theories of development, innovation and growth compete to explain innovation and the appropriate role for the state. The earliest and most popular among policy makers is that the pursuit of policies that create ‘special places’ (Marshall 1890 and Porter 1990) where ‘agglomerations’ of firms and industries generate economies of scale and traded interdependencies. In the 1980s the ‘special processes’ approach to systemic innovation (Lundvall 1992) emerged, positing that economies of scope generate untraded interdependencies between people and firms that co-locate. At the turn of the millennium, a new hypothesis emerged that ‘special people’ working creatively are at the core of the innovation process (Florida 2002). Each theory offers different policy prescriptions for governments seeking to shape their local economic futures. The dominant implicit counterfactual is the ‘theory of comparative advantage” held by economists, that economic activity is inexorably driven to match relative endowments with the production function, with the result that proactive economic development is futile at best or damaging at worst. This session presented the results of a 10-year, multi-community, critical empirical test of the competing theories in the pan-continental Canadian economy, and offer lessons from the theory and practice.
Innovation Policy
Why Does Manufacturing Matter? Which Manufacturing Matters?
Susan Helper, Timothy Krueger and Howard Wial, The Brookings Institution
Manufacturing matters to the United States because it provides high-wage jobs, commercial innovation (the nation’s largest source), a key to trade deficit reduction, and a disproportionately large contribution to environmental sustainability. The manufacturing industries and firms that make the greatest contribution to these four objectives are also those that have the greatest potential to maintain or expand employment in the United States. Computers and electronics, chemicals (including pharmaceuticals), transportation equipment (including aerospace and motor vehicles and parts), and machinery are especially important. American manufacturing will not realize its potential automatically. While U.S. manufacturing performs well compared to the rest of the U.S. economy, it performs poorly compared to manufacturing in other high-wage countries. American manufacturing needs strengthening in four key areas: R&D; worker training; access to finance; and the roles of workers and communities in creating and sharing manufacturing gains.
Industrial Systems: Capturing Value Through Manufacturing
The Royal Academy of Engineering
There is a growing recognition within government, industry and the media that the UK needs to ‘rebalance’ its economy, moving the emphasis towards capturing value from wealth-creating products and services and away from ‘financial engineering’. The tone and content of recent government policies and announcements explicitly recognizes the need for economic recovery based on high-value, high-technology manufacturing. However, capturing value from modern manufacturing not just about capturing the implicit value in making and selling products – it is about capturing value throughout the lifecycle of those products, benefiting many companies and requiring many different kinds of skills throughout the value chain.
Josh Whitford, Connect Innovation Institute
Industrial policy has long been justified only in cases of market failure even as the activities targeted by industrial policy aim primarily to foment innovation, and are thus increasingly governed by decentralized production networks rather than markets or hierarchies. This is a problem. In such industry, network failures are often a more pressing problem. And while there are efforts in the interstices of the decentralized American polity to engage in the sorts of brokerage that best mitigates network failures, many opportunities have been missed due to the pressure to focus on market failures instead. Contra claims that traditional industries cannot be a source of job growth, properly coordinated state action to mitigate network failures can stimulate new innovation and growth among small and mid-sized producers of intermediate goods.
Small Business, Entrepreneurship and Innovation
The Institute for Competitiveness and Prosperity
Smaller businesses are the backbone of Ontario’s and Canada’s economies. But not all smaller businesses are the same. The Ontario economy would be better served if public policy focused on assisting the relatively small number of entrepreneurial high-growth, high-impact firms that will drive innovation, productivity, and prosperity. Thus the emphasis in taxation and broader economic policy should shift from smaller to growing firms.
Roya Gafele
While the detailed mechanisms of the interplay of knowledge creation and economic growth have been discussed in great detail by endogenous growth theory, this paper is interested in assessing the role that universities play in the knowledge based economy. It does so at the example of best practice scenarios, as currently being undertaken by the University of Oxford, U.C. Berkeley, the M.I.T. and Chalmers School of Technology. It argues that key to successful research commercialization is the leverage of clusters and networks that assure knowledge flows between universities and business. This is described as a ‘Third Way’ of university research commercialization, which focuses on systemic change, rather than on single stakeholder intervention. It reflects a novel generation of knowledge policies that focuses on training, awareness raising and the leverage of cluster effects, rather than the development of physical infrastructure (i.e. science parks). This is a unique approach that outperforms existing best practice in many ways; i.e. it focuses on the leverage of networks among the various academic institutions, rather than repeating the traditional ‘one university – one technology transfer office’ approach.
Cities, Clusters & Regions
URBACT
The creative industries [and creativity-based business models] are called to make a significant contribution in building the new post-crisis economic landscape. This assumption is promoting a review of local development strategies in most innovative cities. Few urban issues deal simultaneously so deeply with both space [physical dimension] and economy as creative industries. Indeed that is why these innovative cities are creating a sort of meta-projects or “local creative ecosystems” which deal with people (creative class), the economy (creative industries and entrepreneurs) and places (creative quarters or the very idea of the creative city). This report summarizes three years of learning-by-interacting process within the URBACT framework. It has resulted in a baseline study, two major conferences, four thematic workshops, two key study visits and the production of a Local Action Plan in each of the participating cities.
P.V. Monteiro, T. Noronha and P. Neto, CEFAGE
The purpose of this paper is to provide a critical state-of-the-art review of current research on clusters and its correlation to innovation dynamics in small and medium-sized regions. In particular, the paper focuses on the systematization of the main concepts and theoretical insights that are tributary to the cluster overview in terms of its relevance for the sustainability of the innovation processes, knowledge production and diffusion, which take place inside small and medium-sized regions. The present working paper takes into account the initial studies on English industrial districts (in the nineteenth century), passing through the Italian industrial districts (in the 70s and 80s of the twentieth century), until the modern theories of business clusters and innovation systems. These frameworks constitute the basis of an approach to endogenous development, which gives a central role to the interaction between economic actors, the society and the institutions and to the identification, mobilization and combination of potential resources within a particular geographical area
Beyond Bricks and Mortar Boards: Universities and the Future of Regional Economic Development
Katie Schumuecker and Will Cook, IPPR North
Universities have a substantial contribution to make to the local economy, acting on some of the key factors that drive growth: skills, investment and innovation. They are also major employers in the local economy, and play a key role in upskilling individuals and attracting talent. The spending power of their staff and students has a multiplier effect throughout the local economy. While some of these effects can be achieved simply by universities being there, they need to take an active approach to maximise their impact on the economy. At present, universities appear to have a small influence on private sector innovation in general, with a relatively small number of firms interacting with them to meet their innovation needs. However, those firms that do collaborate with universities do seem to show better performance. This report explores the opportunities for universities to contribute more to their local economy in the new economic development landscape. It also considers some of the obstacles to them doing so. It makes a number of recommendations to universities, the new LEPs and to government for how the contribution of universities can be maximized.
Statistics & Indicators
Joint Venture Silicon Valley Network
Silicon Valley is making an impressive recovery—impressive because the region was the last to succumb when an historic recession gripped our nation, and now it appears to be the first to emerge. The growth is led by a few key sectors which fueled the overall creation of more than 42,000 jobs over the past year, and this report chronicles those developments in careful detail. It also shows how our innovation engine—measured by venture capital, patent registrations, new firm formation, and even IPOs—is clearly revving up again. Though encouraging, this report is not a cause for celebration. The gains are sector specific and not widespread; small businesses are clearly not out of the rough; the public sector is still in the throes of a fiscal crisis; and median household income continues to fall as the gap between those succeeding and those struggling grows wider and wider. It’s as if Silicno Valley is becoming two valleys.
Policy Digest
A National Strategic Plan for Advanced Manufacturing
Executive Office of the President National Science and Technology Council
This report responds to Section 102 of the America COMPETES Reauthorization Act of 2010, which directs the Committee on Technology of the National Science and Technology Council (NSTC) to develop a strategic plan to guide Federal programs and activities in support of advanced manufacturing research and development. Advanced manufacturing is a matter of fundamental importance to the economic strength and national security of the United States. This analysis of patterns and trends in U.S. advanced manufacturing reveals both opportunities for Federal policy to accelerate the development of this vital sector and challenges to its continuing health.
The acceleration of innovation for advanced manufacturing requires bridging a number of gaps in the present U.S. innovation system, particularly the gap between research and development (R&D) activities and the deployment of technological innovations in domestic production of goods. This strategic plan lays out a robust innovation policy that would help to close these gaps and address the full lifecycle of technology. It also incorporates intensive engagement among industry, labor, academia, and government at the national, state, and regional levels. Partnerships among diverse stakeholders, varying by location and objective, are a keystone of the strategy.
The strategy seeks to achieve five objectives. These objectives are interconnected; progress on any one will make progress on the others easier. A large number of Federal agencies, coordinated through the NSTC, have important roles to play in the implementation of the strategy.
Objective 1: Accelerate investment in advanced manufacturing technology, especially by small and mediumsized manufacturing enterprises, by fostering more effective use of Federal capabilities and facilities, including early procurement by Federal agencies of cutting-edge products.
This component of the strategy aims to improve the success of U.S.-based manufacturers, especially SMEs, in the commercialization and scale-up phases of the technology lifecycle. These phases are critical because they set firms on a path of sustainable job creation and profit generation. The focus on SMEs reflects their importance to the manufacturing sector and the difficulty they experience developing and adopting technological innovations.
The report focuses on three kinds of Federal actions that support advanced manufacturing investments: (a) increasing coordination of their investments related to advanced manufacturing with private and non-Federal investors, (b) purchasing products made by advanced manufacturers early in the scale-up phase, and (c) investing in targeted areas of critical importance to national security.
Objective 2: Expand the number of workers who have the skills needed by a growing advanced manufacturing sector and make the education and training system more responsive to the demand for skills.
Unskilled labor was once the mainstay of the manufacturing labor force. As advanced manufacturing supersedes traditional manufacturing, and domestic manufacturers deepen their investment in advanced technologies, the skill requirements for manufacturing jobs are rising. Manufacturing employers perceive a skills gap: 67% of companies surveyed recently by an industry association reported moderate to serious shortages in the availability of qualified workers, even in a period of elevated general unemployment. Certain sectors, such as aerospace/defense and life sciences/medical devices, reported much higher levels of skilled-worker shortages.
Education and training that anticipates and satisfies the skill requirements of advanced manufacturers, while remaining broadly consistent with long-term projections of labor demand, is a key component of this national strategy. Increasing the private sector’s confidence in the availability of a skilled advanced manufacturing workforce creates incentives for domestic investment (see Objective 1). These programs should be targeted particularly toward the workforce needs of SMEs. As more advanced manufacturing technology is deployed, on-the-job training becomes more expensive and difficult for companies, especially SMEs, to provide.
Federal actions under this objective should include such efforts as (a) support for the coordination of state and local education and training curricula with advanced manufacturing skill-set requirements, and (b) expanded support for advanced manufacturing career and technical education programs spanning secondary and postsecondary levels, and apprenticeship opportunities through regional partnerships and industrial cluster programs.
Objective 3: Create and support national and regional public-private, government-industry-academic partnerships to accelerate investment in and deployment of advanced manufacturing technologies.
The acceleration of innovation for advanced manufacturing requires bridging a number of gaps in the present U.S. innovation system. Academic researchers working on problems of importance to advanced manufacturing must communicate more effectively with their counterparts in industry. Federal investments in advanced manufacturing technologies and capabilities must align more fully with similar investments by states and regions and by the private sector. Partnerships among diverse actors, varying by location and objective, are a keystone of our strategy to bridge these gaps.
Actions under this objective will focus more of the Federal advanced manufacturing investment portfolio on partnership activities, especially those that yield benefits for SMEs. These actions include (a) facilitating SME engagement through partnerships, and (b) expanding investments in public–private partnerships in the advanced manufacturing industrial commons.
Objective 4: Optimize the Federal government’s advanced manufacturing investment by taking a portfolio perspective across agencies and adjusting accordingly.
A number of Federal agencies make research, development, and deployment investments that directly or indirectly benefit advanced manufacturers in the United States. These investments are typically made by agencies independently pursuing their statutory missions. The benefits from these investments can be augmented by analyzing them as a portfolio and adjusting agency investment strategies to reflect this analysis. Such adjustments can be made without compromising agencies’ responsiveness to their individual missions. In fact, more efficient and faster development of new technology platforms will enhance the achievement of agency missions.
Actions under this objective include: (a) coordinating Federal agency investments in the industrial commons, and (b) targeting and balancing investments in advanced materials, broad production technology platforms, advanced manufacturing processes, and design and data infrastructure
Objective 5: Increase total U.S. public and private investments in advanced manufacturing research and development (R&D).
Objectives 1 through 4 are essential components of a cohesive national strategy that will increase the payoff from each dollar of Federal investment. They call for leveraging and coordinating Federal investment through partnerships with other levels of government and other public institutions, such as universities, as well as with manufacturers and industry and professional associations. They call for the creation of complementary assets, such as worker skills and industrial know-how, that will fill major gaps in the U.S. national innovation system.
However, actions to meet Objective 1 through 4 will not take full advantage of the present opportunity to sustain and strengthen the Nation’s advanced manufacturing sector. To do that, the Nation must raise its level of investment in R&D as well, as the President has called for. The complementary nature of private and public investments suggests that an increase in one sector will be followed by an increase in the other.
Actions under this objective include (a) enhancing and making permanent the Federal Research and Experimentation (R&E) tax credit in order to expand the scope of activities covered and benefit a larger number of manufacturers, and (b) increasing Federal investment for advanced manufacturing R&D.
Events
The Governance of Innovation and Socio-Technical Systems: Theorizing and Explaining Change
Copenhagen, Denmark, 1-2 March, 2012
‘Governance’ is a notion that has gained increasing currency the past years in the field of (sectoral) innovation systems and socio-technical systems’ studies. Generally speaking, it refers to the ability of a society to solve collective action problems in issues that involve science, technology and innovation. However, there continues to be a considerable level of indeterminacy in the literature. Firstly, because the empirical literature on systems exhibits multiple understanding of change, and hence about how governance processes take place. This diversity has not been properly spelled out, obscuring the way in which change is linked to specific forms of (effective) governance. And secondly, because these empirical studies tend to use the notion ‘governance’ in rather loose conceptual terms and sometimes even only implicitly. This tends to underestimate or ignore the coordination aspect embedded in any form of systemic change. For these two reasons, the actual explanatory capacity of the notion ‘governance’ when studying systems’ change remains limited. This workshop aims at addressing this gap in the literature, asking how do agents and institutions coordinate in the process of generating change in complex socio-technical and (sectoral) innovation systems.
2012 Conference on Entrepreneurial Universities
Muenster, German, 25-27 April, 2012
The conference will be a European discussion forum for researchers and practitioners on Entrepreneurial Universities, where theory and practice are equally emphasised in the programme. We are now calling for presentation papers, workshops and posters on the themes of the conference. We would like to encourage you to submit abstracts of conceptually or empirically focused proposals. All papers will be double-blind reviewed and published in the conference proceedings.
Delft, Netherlands, 13-16 May, 2012
Regions and cities are increasingly interdependent; economically, socially and environmentally. They are, for example, becoming more reliant on interregional flows of trade, labour and resources. Patterns of interactions between regions are experiencing rapid changes as a result of dramatic shifts in production and consumption patterns, advances in communication technologies and the development of transport infrastructure. These changes pose many challenges for the analysis and management of regions. They are also leading to new patterns of activities and relationships and new forms of clustering and networking between regions. At the same time, regions are becoming increasingly fragmented in many ways; economically, socially, environmentally and also politically. Classic forms of government based on clear cut arrangements between administrative levels, policy sectors and the public and private domain are no longer sufficient. The governance of regions faces multi-level, multi-actor and multi-sectoral challenges. New spatial interactions at new scales demand new approaches for consultation and coordination. More flexible (‘softer’) forms of governance are beginning to emerge which seek to work around traditional governmental arrangements.The result is a complex pattern of overlapping governance and fuzzy boundaries, not just in a territorial sense but also in terms of the role of both public and private actors. These new arrangements pose many as yet unresolved dilemmas concerning the transparency, accountability and legitimacy of decision-making. The 2012 RSA conference in Delft provides a timely opportunity for participants to come together and reflect on the various strengths, weaknesses, challenges and opportunities of networked cities and regions within these different contexts of fragmentation.
Towards Transformative Governance? Responses to Mission-Oriented Innovation Policy Paradigms
Karlsruhe, Germany, 12-13 June, 2012
The Lund Declaration, which was handed to the Swedish Presidency of the Council of the European Union by 400 prominent researchers and politicians in 2009, states that “European research must focus on the Grand Challenges of our time moving beyond current rigid thematic approaches. This calls for a new deal among European institutions and Member States, in which European and national instruments are well aligned and cooperation builds on transparency and trust.” The declaration thus asks EU institutions to play a crucial role in bringing the relevant public and private actors together, and helping to build more cooperation and trust in order to address the overarching policy objectives.This declaration has taken up and reinforced a development in the past few years in which governments and the European Union have adopted a new strategic rhetoric for their research and innovation policy priorities which addresses the major societal challenges of our time. This is evolving into the third major policy rationale besides economic growth and competitiveness. It is not yet clear whether and how any transformative effects from this new mission-oriented approach can already be identified. The conference aims to attract papers that discuss possible transformative effects at different levels, i.e. on the actors performing research, innovation processes, scientific fields and technological sectors, the institutional funding and research landscape, society, the demand and user/beneficiary side, research and innovation policy and financing, and national and European political framework conditions. It also invites contributions that critically discuss methodological issues, conceptual developments and novel normative challenges around innovation and R&D policy triggered by the – alleged – mission oriented turn.
Entrepreneurship and Innovation Networks
Faro, Portugal, 14-16 June, 2012
Following the tradition established by the previous symposia, starting in 1998, the symposium is designed to bring together leading-edge views of senior academic scholars and mix them with the critical and creative views of postdocs and PhD students engaged in their thesis work. We welcome researchers from various fields, such as economic geography, economic history, entrepreneurship,
international business, management, political science, regional economics, small business economics, sociology and urban and regional planning. The objectives of the fifteenth Uddevalla Symposium 2012 are: i) to provide a unique opportunity for scholars including senior and junior researchers to discuss path-breaking concepts, ideas, frameworks and theories in plenary key-note sessions and parallel competitive paper sessions, and ii) to facilitate the development and synthesis of important contributions into cohesive and integrated collections for potential publication. Therefore, unpublished complete papers are invited for presentation and feedback from other scholars. A selected list of these papers will be subjected to review and development for publication in scholarly venue.
CALL FOR PAPERS – XXIII ISPIM Conference: Action for Innovation: Innovating from Experience
Barcelona, Spain, 17- 20 June, 2012
The plea for innovation is universal. Managers and politicians have understood that innovation is needed on an everyday-basis to strengthen the competitiveness of organisations, regions and countries. Innovation, however, requires more than good ideas and intentions. Leadership, foresight, courage, investment, inspiration and perspiration are needed to turn intentions and ideas into effective action. Even with these elements in place, not every initiative is successful. However, every action and each experience provide new insights into the causes of failed and successful innovation. Successful innovators, be they individuals, organisations, intermediaries or policy makers, must therefore overcome the paradox of building on experience, and yet breaking away from the status quo, with a permanent innovation mindset. These challenges of “Action for Innovation” are the core focus of this conference.
CALL FOR PAPERS – Sustaining Regional Futures 
Beijing, China, 24-26 June, 2012
The Conference will address some of the biggest issues facing regions and sub-national areas around the world, gateways are being organised on the causes and implications of different patterns of regional development. The gateways are dedicated to assessing the forms and successes of regional policies in managing regional disparities; establishing basic public services; supporting endogenous growth and the comparative advantages of regions; promoting regional competitiveness and sustaining harmony between the economy, society and the environment. Papers on each of these themes are encouraged – on different countries’ and regions’ experiences, and on comparative studies.
The Governance of a Complex World
Nice, France, 1-3 November, 2012
In a period of crisis – according to many commentators the most important one since the Great Depression – the governance of an ever increasingly complex world is a major challenge to economics and social sciences, especially in the current stage where no clear consensus has emerged so far in our scientific communities. The aim of the 2012 International Conference on “The Governance of a Complex World” is the identification of major propositions of political economy for a new society, grounded on structural, technological and institutional change. We encourage submissions dealing with different levels of governance (countries, industries, firms, individuals), where innovation is viewed as a key driver to stir our complex world out of the crisis. We especially welcome analyses in the field of knowledge dynamics, industrial evolution and economic development, dealing with key issues of the emergence and persistence of innovation, entrepreneurship, growth of firms, corporate governance and performance, agglomeration/dispersion of industrial activities, skills dynamics, economics of science and innovation, environment as a driver of innovation.
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This newsletter is prepared by Jen Nelles.
Project manager is David A. Wolfe.