Guest contribution by the Friends of Smart Specialisation

There is now a growing academic literature on regional innovation ecosystems which argues that local economic development is driven by the search for competitive advantage focused on innovation led by societal challenges. Innovation is thus fundamentally an interactive process, socially and territorially embedded and largely linked to the culture, history and institutions of a region or city. 

One of the key features of successful regional innovation ecosystems is their ability to conceive and implement smart specialisation strategies. First elaborated in 2009, smart specialisation has since become a powerful feature of current regional innovation and industrial policies in Europe.  Smart specialisation builds on the need for each region to develop an innovation strategy which in simplistic terms can use a ‘four C’ approach as set out in the early days of smart specialisation:

• (Tough) Choices: limited number of priorities based on an analysis of strengths and international specialisation;
• Competitive Advantage: by matching research and innovation capacities and business needs through an Entrepreneurial Discovery Process (EDP);
• Critical Mass: developing world class clusters and provide arenas for cross-sectorial links internally in the region and externally;
• Collaborative Leadership: efficient innovation systems based on public-private partnership (quadruple helix).

As noted above smart specialisation requires political leadership, a bottom up process of governance involving a wide range of stakeholders who through an EDP identify the competitive advantages of the region and strategic priorities and then are involved in the implementing the strategy.

Smart specialisation has been an ex-ante conditionality in Cohesion Policy since 2014 and will continue as an enabling condition in the next funding period 2021-2027. This support under two EU programming periods is a recognition of the relative success of the policy and its theoretical underpinnings.

However, the success of the concept under regional policy has hidden the relative failure of smart specialisation to move away from a narrow focus on research and innovation policies.  Smart specialisation needs to be applied in such a way as to enable cohesion policy to increase its effectiveness. This involves the widening of the policy domain to include the territorial dimension. In this short paper, we highlight three areas of needed change.

1. It is now important to build on a new sense of social solidarity and engage a wide range of stakeholders in an EDP that can identify a region’s competitive advantages and industrial transition to position the region in current and future European value chains. However, a purely economic discussion may ignore place-based implications of policy recently highlighted by more attention to ‘geographies of inequality’. This is where spatial planners should advise on the territorial dimension of selected economic priorities and their spatial implications.
2. More attention should be placed on the development of efficient innovation policy instruments to support the structural transformation of the economy at the regional and/or national level. A key aspect of this is developing the learning capacity of a region so it can both develop and absorb innovation. This requires a close coordination of skills strategies with smart specialisation strategies at the regional level.
3. It is important that regions do not pursue an inward-looking approach. Economic transformation is also increasingly linked to the search for ‘smart complementarities’ involving transnational collaboration as illustrated by the smart specialisation thematic platforms and regional networks such as the Vanguard Initiative.

A wide range of commentators now accept that we will move to a ‘new normal’. This implies political leadership no longer accepting as normal underfunded public sectors such as health care or economic systems that ignore ecological ceiling. Neither should social and territorial inequality be part of the ‘new normal’.

Territorial policy at EU and some nation state levels has typically been pursued as a distinct strand of activity outside of the mainstream of overall policy. Sectoral policies such as research and innovation are ‘place-neutral’.  This has meant that they have often ignored territorial impact and the potential of spaces. There is an urgent need to find the correct balance between achieving the benefits of scale and scope for pan-European challenges while reflecting local circumstances and priorities. Such is the underlying message of smart specialisation.

Smart specialisation is not a miracle cure but as in the search for new treatments and vaccines against COVID19 we should be guided by facts. Corina Creţu, the previous European Commissioner for regional policy, has announced that smart specialisation ‘represents the most comprehensive policy experience on implementing innovation-driven progress in Europe…’ and it therefore provides a strong model on which to build a European comprehensive recovery plan involving regions and cities with territorial thinkers as key contributors.

About the authors

Dimitri Corpakis, Jan Larosse, Richard Tuffs set up ‘Friends of Smart Specialisation’ in 2018 – an independent group of experts and practitioners concerned for the future directions of smart specialisation. The group’s goal is to support the mainstreaming of Smart Specialisation as an instrument for strengthening the multi-level European innovation system. Contact one of the authors to be added to the FoSS mailing list. For more information, see  http://www.efiscentre.eu/portfolio-item/friends-of-smart-specialisation