The IPL newsletter: Volume 19, Issue 380

News from the IPL


Initiative to Provide Policy Playbook for Regional Australia

Darragh O’Keeffe, Government News
Governments back new research program that aims to provide guidance and best practice for responding to challenges facing regional areas. Adapting to a changing local economy, ensuring jobs in the future and balancing urban and regional population growth are the three initial priorities of a new research program from Regional Australia Institute that has been endorsed by state and territory governments. The RAI, which was established in 2012 to provide decision makers with independent research on regional issues, has been working with regional leaders and agencies around Australia to shortlist common issues for the new program to focus on. The first project aims to provide a new evidence base for governments around helping communities that are experiencing major economic change, such as industrial closures

Editor's Pick

Creating Digital Opportunity for Canada

David A. Wolfe, Innovation Policy Lab
It is no longer possible to underestimate the importance of the digital economy. Not since the introduction of electricity have we seen an interconnected set of technologies with such potential to disrupt established industrial sectors and economic patterns and, in doing so, to generate new opportunities for future generations. The rise of platform firms is creating new opportunities for entrepreneurial start-ups to introduce dynamic new services that turn conventional business models on their heads, and are forcing established companies to follow suit. The result is that platform technologies and the digital networks that support them have become essential tools for businesses across the economy. Most important, the pace of innovation is accelerating, dramatically compressing the time it takes to disrupt established markets. As leading commentators have put it, we are living in an age of exponential growth where digital innovation constantly creates new economic opportunities, but also brings significant disruption. As Canada seeks to harness the unfolding digital revolution as a driver of future growth, three questions stand out:

• What are Canada’s competitive strengths in digital technology?
• Given those strengths, where do the best opportunities lie to grow Canadian companies to global scale?
• What role should government play in supporting the digital economy?

While this report focuses on the opportunities of the digital economy, we cannot ignore the threats. As the repeated examples of the new platform companies has made evident, virtually no sector of the economy is immune to disruption by the rapid spread of digital technologies. The continuing diffusion of cloud computing, social media, data-based technologies, the Internet of Things, and the immanent introduction of 5G mobile technology will only accelerate the trend. The challenge for Canada going forward is to ensure that it turns these potential threats into new opportunities.

Creating Digital Opportunity 5th Annual Conference Papers

In response to the issues identified in the paper above the Innovation Policy Lab established a research partnership to produce the knowledge required to move forward. The Research Partnership on the Digital Economy, including members from 16 universities and 12 partner organizations, has worked together with the goal of situating Canada’s digital opportunity in a global context. It’s fifth annual meeting included presentations from twenty participants on such themes as Canada’s role in East Asian GPNs; the evolving local context for digital firms; digital mining and oil and gas; smart and inclusive Canadian cities; platform economy disruption; global production networks; IT diffusion; and digital inclusion and intelligent communities.

Innovation Policy

AI in the UK: Ready, Willing, and Able?

House of Lords Select Committee on Artificial Intelligence
This inquiry concludes that the UK is in a strong position to be among the world leaders in the development of artificial intelligence during the twenty-first century. Britain contains leading AI companies, a dynamic academic research culture, a vigorous start-up ecosystem and a constellation of legal, ethical, financial and linguistic strengths located in close proximity to each other. Artificial intelligence, handled carefully, could be a great opportunity for the British economy. In addition, AI presents a significant opportunity to solve complex problems and potentially improve productivity, which the UK is right to embrace. The report’s recommendations are designed to support the Government and the UK in realizing the potential of AI for British society and economy, and to protect society from potential threats and risks.

States Equip Employers to Drive Apprenticeship 

Martha Ross and Kimberly Hauge, Brookings
The research is clear that apprenticeship programs benefit both workers and businesses. By combining classroom instruction with paid, on-the-job training under the guidance of a mentor, apprenticeship programs help workers gain valuable skills leading to good jobs and careers, and help employers meet their workforce needs, streamline the hiring process, and reduce attrition. At a time when American employers say they can’t find workers with the skills they need, and job seekers say they can’t find good jobs, apprenticeships can be part of the solution.

Entrepreneurship and Business Development – Transition Briefing

Graeme Moffat, Ontario360
Ontario’s economy has various strengths including (but not limited to) a diversified and highly-skilled labour, high-quality research institutions, and dynamic and diversified sectors. Yet it also faces challenges. Ontario (and Canada) is an outlier among OECD countries for its low and declining investment in business and enterprise R&D. This is important both because of the short-term effects on investment and jobs and the long-term costs in the form of less productivity and lower standards of living. It is essential therefore that the province’s next government develops a comprehensive strategy – including intellectual property and data policies, public spending reforms, tax measures, and post-secondary training – in order to enable more entrepreneurship, business development and research and development.

Cities, Clusters & Regions

The Final Leg: How Ontario Can Win the Innovation Race

The Institute for Competitiveness and Prosperity
This working paper explores how Ontario’s innovation performance could be boosted by improving commercialization of research and inventions in the province. The Institute examines best practices in commercialization support from the German Fraunhofer Society, which has successfully bridged the gap between early research and large-scale production known as the ‘innovation valley of death’. The Fraunhofer Society, a network of 69 applied research institutes across Germany, is widely regarded as one of the most successful networks of technology and innovation centres (TICs) in the world. Founded in 1949, the Fraunhofer institutes perform technical and commercialization research on contract to public and private sector clients and develop university and self-generated research into marketable products and processes. The Institute’s research suggests that Ontario could improve its poor record of commercializing its own research and boost technology adoption by Ontario businesses by creating a network of TICs to bridge gaps in the innovation process.

Small Cities Face Greater Impact from Automation

Morgan R. Frank, Lijun Sun, Manuel Cebrian, Hyejin Youn, Iyad Rahwan,  Journal of the Royal Society Interface
The city has proved to be the most successful form of human agglomeration and provides wide employment opportunities for its dwellers. As advances in robotics and artificial intelligence revive concerns about the impact of automation on jobs, a question looms: how will automation affect employment in cities? Here, the authors provide a comparative picture of the impact of automation across US urban areas. Small cities will undertake greater adjustments, such as worker displacement and job content substitutions. The report demonstrates that large cities exhibit increased occupational and skill specialization due to increased abundance of managerial and technical professions. These occupations are not easily automatable, and, thus, reduce the potential impact of automation in large cities. This study provides the first empirical law connecting two societal forces: urban agglomeration and automation’s impact on employment.

Specialization of and Complementarities Between (New) Knowledge Clusters in the Frankfurt/Rhein-Main Urban Region

Kati Volgmann and Angelika Munter, Regional Studies, Regional Science
This paper contributes to the discussion about the driving forces behind the polycentric restructuring of urban regions involving a centripetal process of metropolization and a centrifugal process leading to a regionalization of cities. Using the Frankfurt/Rhine-Main urban region in Germany as an example, it analyzes how these processes are manifested in the regional spatial structure. Two different empirical explorations are applied to reveal the spatial distribution and clustering of (1) knowledge-based industry (KBI) firms on a locational scale and (2) the sectoral specializations of and complementarities between the identified clusters. On the one hand, the identified traditional and new KBI clusters mirror the region’s traditional polycentric structure; on the other, the Frankfurt central business district stands out as the definite hotspot for KBI activities within the region. Thus, metropolization processes turn out to be the dominant driver of urban restructuring. Regarding the latter, the analysis shows that new KBI clusters frequently demonstrate strong monofunctional specialization and tend to complement and relieve traditional central business districts with regard to specific types of KBI activities, particularly in high-technology manufacturing and related high-technology knowledge-intensive services.

Statistics & Indicators

Renewing America’s Economic Promise Through Older Industrial Cities

Alan Berube and Cecile Murray, Brookings
The middling performance of communities with historically strong manufacturing cores is a key feature of America’s uneven economic growth. These so-called older industrial cities,predominantly located in the Midwest and Northeast, have struggled over time to grow jobs in new sectors and to boost employment and income, particularly for their communities of color. They range from very large cities like Baltimore and Detroit, to smaller communities like Schenectady, New York, and Terre Haute, Indiana. This report identifies, analyzes, and categorizes the considerable assets and distinct challenges of 70 older industrial cities that collectively account for one-eighth of the U.S. population and economy. With increasing interest in local, state, and national policies to revive the fortunes of struggling communities, older industrial cities represent promising regions for strategic investment and critical centers for promoting inclusive economic growth.

Policy Digest

Why “Smart” Manufacturing Matters and How Countries are Supporting It

Stephen Ezell, ITIF
This report explains how digitalization is transforming manufacturing globally, detailing what smart manufacturing (or “Industry 4.0”) is and examining the productivity impacts it promises. It then examines the small- and medium-sized enterprise (SME) manufacturing support programs and policies of ten nations—Argentina, Australia, Austria, Canada, China, Germany, Japan, Korea, the United Kingdom, and the United States—and provides insights countries can leverage to support the digitalization of their manufacturers. Finally, the report examines how the development of common standards can facilitate technology adoption and proposes a typology that helps conceptualize different manufacturing production systems and strategies, showing how these need to be supported by varying digital toolsets.

Smart Manufacturing Standards

The development of voluntary, industry-led, consensus-based, market-driven global standards for products and technologies benefits producers and consumers alike. Internationally compatible standards enable businesses to leverage technologies and manufacture products efficiently at economies of scale by reducing the cost that would otherwise be involved in producing specific variations of products to meet different jurisdictions’ standards.

Avoid structuring standards as barriers
Unfortunately, some nations are increasingly using mandatory standards as a mercantilist tool to block or limit foreign companies’ access to their markets and to support domestic industries, especially ICT industries. By imposing unfair standards-related measures on imports, foreign governments may game the international trading system on behalf of their domestic industries and impose additional costs that both harm consumers as well as a country’s own competitiveness in digital sectors. The OECD estimates that complying with country-specific technical standards can add as much as 10 percent to the cost of an imported product. It’s therefore important that countries avoid isolated, proprietary standards and siloed solutions and that policymakers encourage the use of globally relevant standards for ICTs, including those applied to digital manufacturing.

Developing standards will facilitate international cooperation
If the smart manufacturing vision is to succeed, a series of standard protocols will be indispensable to allow factories, machines, and products made by vendors from all over the world to communicate and interact with each other and to ensure solutions can be used in any country. As the excellent report “Industrie 4.0 in a Global Context: Strategies for Cooperating with International Partners” explains, “individual modules, components, devices, production lines, robots, machines, sensors, catalogues, directories, systems, databases, and applications will need common standards for the connections between them and the overall semantics, or how data gets seamlessly passed from one device to another.” Thus, standardization of architectures, data exchange formats, vocabularies, taxonomies, ontologies, and interfaces will be key to creating interoperability between different digital manufacturing technologies. Accordingly, as the same report notes, the two key issues standardization must address are ensuring interoperable interfaces between solutions from different manufacturers; and establishing open standards, which are essential for the emergence of open, flexible, and successful ecosystems spanning not only different manufacturers but also different countries and continents. The authors note that, “whoever is first to define such internationally accepted standards will likely gain a long-term competitive advantage.”

Risks of failure
A number of risks arise if the international community fails to achieve standardization around Industry 4.0. First, the inability of sensors, machines, and software produced by a variety of different global vendors to seamlessly exchange data, information, and intelligence in real-time would leave the smart manufacturing vision stillborn. Moreover, if no international standards or universal solutions exist to provide interoperability between different systems, individual companies run the risk of suffering technological lock-in. This in particular affects SMEs, which may be reticent to make the requisite investments in Industry 4.0 technologies or systems, fearing that if they acquire proprietary standalone or siloed solutions they could become dependent on the technology of one particular supplier. The international competition with regard to the establishment of norms and standards for Industry 4.0 actually means that close cooperation will be required between businesses and institutions.

Nations are competing fiercely for advanced manufacturing leadership. Countries will need to introduce a comprehensive national manufacturing digitalization strategy and make the requisite investments if they wish to keep pace. Small manufacturers, especially, can’t be expected to go-it-alone in this environment and will need to benefit from both smart collaborations with suppliers as well as from government programs that encourage and incentivize their adoption and uptake of digital and other advanced-production strategies and technologies.


Towards a Smart and Inclusive City-Region

Toronto, 15 May, 2018
The Toronto city-region is at an inflection point. How do we manage a rapidly growing tech sector while also supporting communities and local entrepreneurs? Can we build partnerships across sectors that will stimulate innovation and prosperity? At the University of Toronto’s free event, Toronto: Towards a Smart and Inclusive City-Region, these important questions will be discussed with Dan Doctoroff, CEO of Sidewalk Labs; Professor Richard Florida, Director, Martin Prosperity Institute, Rotman School of Management;  Professor Meric Gertler, renowned urban scholar and U of T President; Professor Janice Stein, Munk School of Global Affairs, U of T; Kim Walesh, Director of Economic Development, City of San Jose; and Armine Yalnizyan, Toronto-based economist and business commentator. Join urban thought leaders, policy makers, planners, business leaders, and entrepreneurs as they exchange ideas on ways to meet the challenges of city building to ensure that smart cities are also inclusive cities.

8th Competition and Innovation Summer School (CISS)

Ulcinj, Montenegro, 28 May – 2 June, 2018
This workshop offers young interested researchers within the fields of the economics of innovation and competition the possibility to intensively discuss their dissertation plans or drafts within a peer group of experienced and renowned scholars, as well as other PhD students and post-doc researchers in a great environment.
CISS offers lectures and workshops on:

  • topics of innovation,
  • the economics of science and intellectual property rights,
  • empirical competition analysis, and
  • contemporary issues surrounding theories of industrial organization.

5G and Broadband Connectivity for All

Durban, South Africa, 31 May – 1 June, 2018
WWRF and CSIR are partnering to organize the wireless world research forum meeting WWRF40 in Durban, South Africa. The theme for the research Forum meeting is: 5G and Broadband Connectivity for All. The Organizers therefore invite academics, researchers and industrial representatives to share information and present results on Future Wireless Communication Systems, Networks and Services and to discuss critical business and regulatory aspects, advanced technology findings that will impact the deployment of 5G and enabling broadband connectivity for All. Technical papers describing recent research results and disruptive innovations in technologies, regulatory positions and business models are solicited. Contributions focusing on the WWRF 40th meeting theme 5G and Broadband Connectivity for All, particularly within the areas of WWRF’s existing Vertical Industry Platforms (VIPs) and Working Groups (WG) are welcome.

A World of Flows – Labour Mobility, Capital, and Knowledge in an Age of Global Reversal and Revival

Lugano, Switzerland, 3-6 June, 2018
The 2018 RSA Annual Conference aims to address processes of global reversal and regional revival, in a world dominated by flows of capital, labor, and knowledge. Further it seeks to understand the political, economic and social factors that initiate change and how these changes are finding new expressions as the world’s political and economic system continues to struggle with low rates of global economic growth, the rise of China as an economic super power, the on-going impacts of recession and austerity, and increasing levels of inequality. To study and debate these and many other questions, we warmly invite the regional studies/science and connected communities to join us.

4th ZEW Conference on the Dynamics of Entrepreneurship

Mannheim, Germany, 18-19 June, 2018
This conference is jointly organized by University of Mannheim and ZEW. The aim is to discuss recent scientific contributions to entrepreneurship research. Theoretical, empirical, and policy-oriented contributions from all areas of entrepreneurship research are welcome.

List of Topics (non-exhaustive)

̶  Impact of industrial dynamics (entry and exit) on aggregate productivity dynamics
̶  Direct and indirect contributions of entrepreneurial firms to innovation
̶  Personality traits and motivation of entrepreneurs
̶  Human capital of founders and employees
̶  Entrepreneurial teams
̶  Socio-demographic aspects of entrepreneurship (e.g. ethnic entrepreneurship, migrant entrepreneurship, and female entrepreneurship)
̶  Digital entrepreneurship
̶  Incubators, corporate and academic spin-offs
̶  Scale-ups, gazelles and unicorns
̶  Financing young firms: (corporate) venture capital, business angels, crowdfunding, and banks
̶  Employment, wages, and workplace quality in entrepreneurial firms
̶  Impact and efficiency of public entrepreneurship policies
̶  Impact of entrepreneurship on established firms
̶  Entrepreneurship in aging societies

Triple Helix XVI Manchester

Manchester, UK, 5-8 September, 2018
Across the world, states and city regions are facing huge societal, economic, environmental, and political challenges whose solutions require concerted new efforts and innovative partnerships. The 2018 International Triple Helix Conference brings together academia, government, business, and community to share effective practices and to advance the frontiers of knowledge about collaboration for economic progress, social development and sustainability, and the role of cities and regions as enabling spaces for these interactions.

Call for Participation: International PhD Course on Economic Geography

Utrecht, The Netherlands, 11-14 September and 30 October-2 November, 2018
The course aims to provide an introduction to contemporary research perspectives and approaches in economic geography. The core questions of this discipline – related to the role of place and space in processes of economic development – have in recent years attracted interest not just from geographers but also from economists and other social scientists. This course will debate recent theoretical developments (with special attention to evolutionary and institutional economic geography), and will discuss recent advancements in methodology and empirical analysis in economic geography.

2018 European Week of Regions and Cities – Masterclass on EU Cohesion Policy for PhD Students and Early Career Researchers

Brussels, Belgium, 7-11 October, 2018
As part of the 16th European Week of Regions and Cities (EWRC), the biggest event worldwide on regional and urban development, the Master Class on EU Cohesion Policy will be held for PhD students and early-career researchers for the sixth time. Applications are being sought from PhD students and early career researchers (defined as being within five years of the date on their PhD certificate or equivalent) undertaking research related to European Cohesion Policy to attend the 2018 University Master Class. The Master Class is a unique format to connect aspiring researchers and will include presentations of papers by the participants as well as lectures and panel debates with policymakers, EU officials and senior academics to improve understanding of, and research, on EU Cohesion Policy. In particular, the Master Class will serve to

  • discuss recent research on European regional and urban development and EU Cohesion Policy;
  • enable PhD students and early career researchers to exchange views and network with policymakers, EU officials and senior academics;
  • raise awareness and understanding of the research potential in the field of EU Cohesion Policy.

 The Master Class is organised and led by the European Commission, DG for Regional and Urban Policy (DG REGIO), the European Committee of the Regions (CoR) and the Regional Studies Association (RSA) in cooperation with the European Regional Science Association (ERSA) and the Association of European Schools of Planning (AESOP).

TCI 2018 – Unexpected Connections: Collaborating to Compete – Clusters in Action

Toronto, 16-18 October, 2018
Cluster success is often the result of collaboration, more than just the agglomeration of anchor firms, R&D labs, incubators and accelerators, and disrupting organizations. Regions with clusters that actively collaborate within and between one another are more competitive. As firms continue to face new challenges from technological, economic, and political shifts, clusters remain a driving catalyst that can create sustainable levels of innovation and economic growth. Firms, at the heart of active clusters, with the support of those within the cluster ecosystem, can weather the changing dynamics of the global marketplace. TCI 2018 explores the collaboration that is happening within clusters and the opportunities to work together towards shared prosperity.

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This newsletter is prepared by Jen Nelles.
Project manager is David A. Wolfe.