Ontario's Regional Economic Development and Innovation Newsletter



Issue #220                                                       October 1, 2010

  Studies & Publications: Announcements | Editor's Pick | Innovation Policy |Cities and Regions | Statistics and Indicators| Policy Digest | Events
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This newsletter is published by ONRIS at the Centre for International Studies, 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                                                          [Table of Contents]

SBA Announces Support for 10 Regional "Innovation Economies" Clusters, Job Creation

The U.S. Small Business Administration recently announced support for 10 regional economic development and job creation efforts through a new pilot program, “Innovative Economies.” The pilot program supports small businesses participation in regional economic “clusters” – collaborations between small businesses, the public sector, economic development and other organizations.
The 10 “Innovative Economies” awardees selected from among 173 applicants to participate in the pilot program represent a wide range of diverse geographic areas and industries. From urban to rural and clean energy to robotics, the applicants focused on leading research and commercializing new products. SBA’s funding will be provided to each cluster’s organizing entity to strengthen opportunities for small businesses within the cluster. The funds can be used to provide services, including mentoring and counselling small businesses, as well as to attract more small business participation.

Lack of Critical Mass of Domestic Venture Capitalists Seen as Creating Poor Climate for Future Investment and Innovation

Venture capitalists (VCs) in Canada expect their industry to contract further while those in emerging markets, including China, India and Brazil, expect to see theirs expand over the next five years, according to the 2010 Global Venture Capital Survey by Deloitte, Canada's Venture Capital & Private Equity Association (CVCA) and several other international industry associations. According to the survey results, two thirds (66 per cent) of Canadian survey respondents expect the number of venture firms to decrease between now and 2015, while a great majority of venture capitalists in China, India and Brazil anticipate adding more venture firms in their country during the same time frame. Venture capitalists in the U.S. and the European continent also expect an industry tightening in their respective countries, but the Canadian industry is much more vulnerable to such a trend given its much smaller size.

EDITOR'S PICK                                                             [Table of Contents]

European Cluster Policy Group - A Call for Policy Action

PRO INNO Europe/ECPG
Today – faced with tighter budgets, more intense global competition, and evolving innovation processes – there is a need for European policymakers to more actively lever the potential of clusters to modernise and improve their economic policies. The question is how? The European Cluster Policy Group (ECPG) presented its recommendations for future cluster efforts in Europe at the first European Cluster Conference (held in Brussels, September 30th). The ECPG Final Recommendations - A Call for Policy Action highlights three principles and eight action proposals for EU institutions and Members States to take on board. A complementary report (Consolidated Set of Policy Recommendations on Four Themes) provides a summary of the suggested actions related to the four themes addressed during the Group's mandate.

INNOVATION & RELATED POLICY                                  [Table of Contents]

Knowledge Transfer Through Research Contracting

Impact Group
The focus of this study was on research contracts - research performed by universities and hospitals or health authorities on behalf of third parties - and excluding research funded by grants and contributions. In contrast to academic research, contract research has a specified client and normally has a defined deliverable and a specified time frame. Canadian universities and hospitals/health authorities reported that in 2006 they conducted approximately $5.53 billion of research that was funded by external sources.

The Creative Economy and Culture at the Heart of Innovation Policy

Finnish Ministry of Education and Culture
Many traditional sectors are currently in difficulty. The challenge for Finland is to find a new direction for innovation policy at the national and regional level. The creative economy and culture offer one opportunity for new initiatives to strengthen Finnish innovation activities. With this publication, the Ministry of Education and Cultural Theme Group hope to offer new perspectives on the sector to those working in the creative economy and especially regional developers. At the end of the articles, the different authors present their opinion on development proposals that could be implemented in various development activities.


CITIES, CLUSTERS & REGIONS                                          [Table of Contents]

Silos of Small Beer: A Case Study of the Efficacy of Federal Innovation Programs in a Key Midwest Regional Economy

Maryanne Feldman and Lauren Lanahan, Center for American Progress
Amid today’s stumbling economic recovery, policymakers are examining a variety of measures to help businesses compete and grow their workforces. As part of this effort, it is critical that they understand how regional economies across our country stitch themselves together from the bottom up—what makes them tick and what they need to grow and thrive in the 21st century. Alas, federal innovation policies aimed at boosting the competitiveness of the economy through investments in science and technology commercialization are often grounded in 20th-century economic development strategies that overlook the importance of regional economies and no longer match the needs of the 21st-century global economy. Despite the clear limitations of existing federal innovation programs, they remain important to national economic competitiveness. So understanding the efficacy of these federal innovation programs is the first step toward understanding how to improve them or replace them. That is what the authors set out to do in this paper in one regional economy of the country—the eastern Midwest region that includes Pittsburgh in western
Pennsylvania; and Cleveland, Akron, and Youngstown in northeast Ohio.

An Economy Out of Shape: Changing the Hourglass

Toronto Workforce Innovation Group
This Toronto Workforce Innovation Group report examines changes in the occupational structure of the labour force in the City of Toronto and the rest of Ontario using Statistics Canada census data. The purpose of this report is to highlight trends, isolate the impact of these trends on different population groups, and offer recommendations that can contribute to economic growthand productivity as well as promote equitable outcomes for all workers.

Clustering the Winners: The French Policy of Competitive Clusters

Lionel Fontagne et al., CPEII
In 2005 the French government launched a policy of competitiveness clusters, giving subsidies for innovative projects managed locally and collectively by firms, research centers and universities. This paper proposes an ex-ante analysis of the outcome of the selection process that took place before the implementation of the subsidies program, in order to assess whether the policy ended up in choosing winners or losers. It first asks how the clusters were selected, and then focuses on the selection of firms within the clusters, using export and productivity data as measures of performance. The main conclusion is that public authorities chose the winners during the two-step selection procedure.

Winning in Emerging Market Cities: A Guide to the World's Largest Growth Opportunity

The Boston Consulting Group David Jin et al.
One-third of the world’s population—2.6 billion people—live in emerging-market cities. by 2030, the number of emerging-market urban dwellers will increase by an additional 1.3 billion, with another 371 emerging-market cities exceeding the 500,000 population mark. The size and pace of this growth means that the most pivotal decisions that many companies will soon face are those that concern these cities—and understanding how to win in them will be the business imperative of the next decade. This report identifies the trends driving this opportunity and provides practical recommendations to winning in the emerging-market cities.

STATISTICS & INDICATORS                                                                  [Table of Contents]

EU Regional Competitiveness Index

European Commission Joint Research Center
To improve the understanding of competitiveness at the regional level, the JRC has developed a new index to demonstrate the strengths and weaknesses of each of the 271 EU regions. This index incorporates a wide range of issues related to competitiveness including innovation, quality of institutions, infrastructure (including digital networks) and measures of health and human capital, and will be a crucial tool in assisting EU regions to set the right priorities to further increase their competitiveness.

The Global Finaincial Centers Index 8

Long Finance
The Global Financial Centres Index (GFCI) was first published in March 2007. The GFCI approach provides profiles, ratings and rankings for 75 financial centres, drawing on two separate sources of data – instrumental factors (external indices) and assessments by financial services professionals to an online survey.

POLICY DIGEST                                                                  [Table of Contents]

The New "Cluster Moment": How Regional Innovation Clusters Can Foster the Next Economy

Mark Muro and Bruce Katz, The Brookings Institution
Twenty years after Harvard Business School professor Michael Porter introduced the concept to the policy community and 10 years after its wide adoption, clusters—geographic concentrations of interconnected firms and supporting or coordinating organizations—have re-emerged as a key tool and rubric in Washington and in the US’s economic regions. After a decade of delay, the executive branch and Congress have joined state and local policymakers in embracing “regional innovation clusters” (RICs) as a framework for structuring the nation’s economic development activities.  Cluster thinking and cluster strategies have the potential to accelerate regional economic growth and assist with the nation’s needed economic restructuring, but they are more a paradigm than a single program. In that sense, the opportunities that a cluster policy framework provides for delivering impact, clarifying economic priorities, and coordinating disparate programmatic efforts will only grow more important in the coming era of intensified competitive pressures and tightened resources.

This paper finds that:

1. Clusters and cluster approaches hold out substantial attractions as the nation seeks to rebuild a damaged economy.  Clusters, in this respect, have emerged as a major focus of economic and policy discussion just now by dint of their demonstrated practical impact, their value in paradigm discussions, and their potential utility in policy reform. Most notably:

    • Pointing to impact, new research confirms that strong clusters tend to deliver positive benefits to workers, firms, and regions.  It is now broadly affirmed that strong clusters foster innovation through dense knowledge flows and spillovers; strengthen entrepreneurship by boosting new enterprise formation and start-up survival; enhance productivity, income-levels, and employment growth in industries; and positively influence regional economic performance;

    • As a matter of paradigm, clusters reflect the nature of the real economy. Cluster frameworks, in this respect, highlight the real-world interactions, connections, transactions, and dealings of real firms after a period of delusion and over-simplification.  For example, the cluster paradigm emphasizes the regional underpinnings of the national economy; highlights the unique variations and specializations that define productive local economies; and focuses attention on the myriad actors and the dynamics of their exchanges and interactions that give rise to new innovations and jobs.  Clusters, in short, provide a timely and useful lens through which to clarify what matters in economic affairs;

    • As a matter of policymaking, clusters provide a framework for rethinking and refocusing economic policy .  The cluster paradigm, finally, yields practical insights that can help policymakers get their priorities right and maximize the impacts of their efforts at a time of constrained resources.  Along these lines, cluster thinking appeals because it: puts the policy focus on regions; draws attention to the grainy, real-world dynamics of regional economies; takes into account the need for local discretion across regions and industries; and provides a vehicle for coordinating fragmented policy offerings to improve efficiency.

2. When it comes to policymaking leaders at all levels should adhere to a set of core general principles when pursuing cluster-based economic development strategies.  Regional innovation clusters are a fact of economic life, but their promotion through government or quasi-government initiatives must be pursued judiciously—through data-disciplined, targeted interventions.  To guide such effort going forward at least six general watchwords bear consideration.  Namely:

    • Don’t try to create clusters.  Clusters can’t be created out of nothing and cluster initiatives should only be attempted where clusters already exist.  The pre-existence of a cluster means that an industry hotspot has passed the market test.  By contrast, efforts at wholesale invention will likely be fraught with selection issues, inefficiency, and probable failure and waste; 

    • Use data and analysis to target interventions, drive design, and track performance. Cluster strategies or policy interventions—when attempted—should be grounded in rigorous empirical information and analysis so that decision-makers can make objective assessments about the nature, competitive prospects, and specific needs of different regional industry concentrations. Cluster strategies also need to be held accountable so performance measurement is critical;

    • Focus cluster initiatives on clusters where there is objectively measured evidence of under-capacity .  Work to upgrade an identified cluster should be tightly focused on attacking specific, documented constraints, institutional deficiencies, or resource shortcomings;

    • Maximize impact by leveraging cluster-relevant preexisting approaches, programs and initiatives.   Specific, targeted cluster-oriented initiatives are clearly justifiable, but equal value and added impact may well come from drawing other, more generally relevant programs into the cluster orbit. For example, at the federal level programs like the R&D tax credit as well as SBI and SBTT grants, workforce training programs, and small business finance may all be rightly viewed as “cluster” programs, just as banking regulations, tax credits for venture capital, and education policy may be at the state level. In this way, “clusters” and cluster strategies are less a specific program than a framework through which to shape and coordinate disparate policies;

    • Align efforts “vertically” as well as horizontally.  The cluster paradigm can—and should—be used to organize the disconnected policy offerings of any one level of government in service of clusters’ needs in a region, but it also provides a framework for coordinating them up and down the tiers of federalism to avoid policy conflict, redundancy, or missed opportunities for synergy;

    • Let the private sector lead.  Clustering is a dynamic of the private economy in the presence of public goods.  Cluster strategy should be pursued with humility as a matter of supporting, connecting, filling gaps, and removing obstacles to private enterprise while making sure certain public and quasi-public goods are available.

3. While keeping these principles in mind, all tiers of the nation’s federalist system have roles to play in advancing the co-development a new cluster-informed stance in U.S. economic policy.  At a time of near- and longer-term economic crisis, a rough division of labor among the levels of government can be envisioned:  

    • Federal policymakers can provide a rich base of information and related foundational resources for cluster practitioners nationwide.  Going forward, the federal government should move aggressively to build the information base necessary for cluster activity and policymaking; create effective forums for best practice sharing; enhance the capacity of regional cluster intermediaries with planning and other assistance; employ cluster paradigms on major national challenges; coordinate disparate cluster-relevant programs; and ensure the overarching cluster effort is visibly prominent; 

    • State policymakers should strategically invest their own resources in cluster-led economic development.  States can make clusters a central component of economic development planning; target investments strategically to clusters of state significance; and adjust metropolitan governance to ease regional collaboration;

    • Regional leaders should identify cluster challenges and coordinate cluster actors. Regional intermediaries should work to identify and describe local clusters, identify their binding constraints, and facilitate regional joint action to implement needed exchanges and initiatives;

    • Local policymakers should bring to tools to influence on-the-ground implementation of cluster-oriented economic development.  They should manage zoning and permitting issues to benefit the physical infrastructure in which clusters exist, and they should keep an eye out for the broader demographic and social context in which new industry clusters might form and to which existing ones must adjust.

 

 

 

EVENTS                                                                               [Table of Contents]

Migration to Integration: An Opportunity Agenda for Cities

The Hague, Netherlands, 3-4 October, 2010
Cities of Migration showcases innovative integration practices from global cities using a fresh storytelling approach and a compelling message: integration is a critical dimension of urban prosperity and growth. Join us for big ideas and new perspectives on immigrant integration at the first international Cities of Migration Conference. Plenary speakers, a townhall debate, panel discussions and a marketplace of innovative ideas add up to a dynamic learning event that will inspire renewed urban leadership and new thinking on migration

Triple Helix in the Development of Cities of Knowledge, Expanding Communities and Connecting Regions

Madrid, Spain, 20-22 Oct, 2010
Innovation is understood as a resultant of a complex and dynamic process related to interactions between University, Industry and Government, in a spiral of endless transitions. The Triple Helix approach, developed by Henry Etzkowitz and Loet Leydesdorff, is based on the perspective of University as a leader of the relationship with Industry and Government, to generate new knowledge, innovation and economic development. The main theme of our conference is “Triple Helix in the Development of Cities of Knowledge, Expanding Communities and Connecting Regions”.

Entrepreneurship and Community: 26th Annual CCSBE Conference

Calgary, 28-30 October, 2010
The theme this year is Entrepreneurship and Community. We are seeking to explore the multifaceted impact entrepreneurs and small businesses have on their communities through their new ventures, business and community outreach. There is growing recognition by policy makers, members of society, business leaders and youth, that creative approaches are needed to address environmental, economic, and societal issues. The conference program highlights the research, educational methods, and community practices pertaining to venture sustainability and social entrepreneurship. In support of the theme we have attracted an array of plenary and guest speakers, and developed workshops which will contribute to the dialogue.

Reshaping Europe: Addressing Societal Challenges Through Entrepreneurship and Innovation

Liege, Belgium, 27-29 October, 2010
Over the past couple of years, Europe, and the rest of the world, has faced an unprecedented crisis affecting all sectors of the economy. The crisis and the recovery that is now taking place in most Member States provide experiences that can be used to reshape Europe and to ensure that it is stronger and better prepared for the challenges of the 21st century. The Europe 2020 Strategy is designed to improve the business environment. It is vital that this environment offers the framework conditions to turn ideas into products and services more quickly and easily, whilst addressing environmental concerns and making efficient use of resources. At this important turning point, the Europe INNOVA conference will provide a timely opportunity to determine how innovation policy and innovation support can help Europe and its enterprises, both large and small, to best face these challenges.The conference will unite the Europe INNOVA Community with key innovation stakeholders from the worlds of politics, academia and business. Together they will discuss three approaches that are crucial if Europe is to respond to the societal challenges with which it is currently confronted.

Making Innovation Work for Society: Linking, Leveraging and Learning GLOBELICS 8th Annual Conference

Kuala Lumpur, Malaysia, 1-3 November, 2010
Global Network for Economics of Learning, Innovation, and Competence Building Systems (GLOBELICS) is an international network of scholars who apply the concept of "learning, innovation, and competence building system" (LICS) as their framework and are dedicated to the strengthening of LICS in developing countries, emerging economies and societies in transition. The research aims at locating unique systemic features as well as generic good practices to enlighten policy making relating to innovation, competence building, international competitiveness, regional development, labour market and human capital development. In an increasingly global and knowledge‐based competition, management strategies need to be based upon an understanding of these framework conditions and the public policies which seek to regulate the environment.

CALL FOR PAPERS: The Entrepreneurial University and thte Academic Enterprise

Washington, DC, 12-13 November, 2010
The theme of the 2010 conference is The Entrepreneurial University and the Academic Enterprise. Conference presentations should focus on the potential commonalities and/or conflicts of interests among government, university, and industry participants in technology transfer. The sessions will emphasize also the assessment of technology transfer activities, especially how to examine the objectives and processes of technology transfer activities (beyond the immediate needs of the participants), including both formal and informal transfer mechanisms (Link, Siegel & Bozeman, 2007; Abreu et al, 2008). Special focus will be placed on papers which evaluate the aspects of academicuniversity research relationships beyond their immediate outputs (Georghiou & Roessner, 2000; Vonortas & Spivack, 2005, Carayannis and Provance, 2007), including intellectual property issues (Feller & Feldman, 2009), modes of commercialization (Kenney & Patton, 2009), and economic impact (Roberts & Easley, 2009).

Knowledge Cities World Summit 2010

Melbourn, Australia, 16-19 November, 2010
‘Knowledge’ is a resource, which relies on the past for a better future. In the 21st century, more than ever before, cities around the world rely on the knowledge of their citizens, their institutions, their firms and enterprises. Knowledge assists in attracting investment, qualified labour, students and researchers. Knowledge also creates local life spaces and professional milieus, which offer quality of life to the citizens who are seeking to cope with the challenges of modern life in a competitive world. This conference will offer a range of innovative presentation formats aimed at facilitating interaction and accessibility for all members of the Knowledge Summit community. The Summit will attract a range of multidisciplinary participants including: practitioners, managers, decision and policy makers of non-government organisations, technology solution developers, innovators, urban planners, urban designers and developers, academics, researchers and postgraduate students.

9th Annual Incubation Conference: Combining Technological Entrepreneurship with Creativity and Culture

Liverpool, UK, 18-19 November, 2010
First established in 2002 this annual conference has developed into a renowned international event in which incubators, science parks, investors, universities, governmental organizations and industry discuss and evaluate their strategy on how best to support young start-ups on the road to succes. Be a part of this inspiring event!

INNOWEST 2010: How innovative companies used innovation to navigate successfully through the recession and position themselves for growth

Calgary, 25-26 November, 2010
The companies worst hit in western Canada during the recession tended to be those with undifferentiated products with many competitors, where price competition became severe. By contrast, the companies who did reasonably well tended to have unique products and fewer competitors. InnoWest 2010 tells the story of some of these companies, and how innovation helped them to live through the recession relatively unscathed, and position themselves for growth in the recovery. InnoWest 2010 will not focus on the very large companies [such as Suncor] or on very small companies [for example, a 10 employee company] but will focus on the large middle ground where the bulk of Canada’s GDP is generated. Keynote speakers include Sir Terry Matthews.

Innovation 2010

Ottawa, 5-7 December, 2010
Globally, innovation is recognized as the driving force towards lasting sustainable prosperity in the coming decades. The federal government’s S&T strategy promotes action to grow the translation of knowledge into commercial applications that generate wealth for Canadians and support a high quality of life. We have the opportunity to build a world-class innovation ecosystem in Canada. The challenge is to foster increased partnerships and collaboration among public, academic and private sectors to ensure we improve knowledge mobilization and commercialization for world-class next generation products and services. In keeping with these challenges and opportunities, ACCT Canada, Federal Partners in Technology Transfer (FPTT) and the Networks of Centres of Excellence (NCE) are pleased to present their first national joint conference on innovation and competitiveness in Canada: INNOVATION 2010.

Managing the Art of Innovation: Turning Concepts into Reality

Quebec City, 12-15 December, 2010
Organized by ISPIM in collaboration with local partner INO, a leading non-profit R&D center in Optics/Photonics in Canada, this symposium will bring together academics, business leaders, consultants and other professionals involved in innovation management. The symposium format will include facilitated themed sessions for academic and practitioner presentations together with interactive workshops and discussion panels. Additionally, the symposium will provide excellent networking opportunities together with a taste of local French Canadian culture.

CALL FOR PAPERS - DRUID/DIME Academy Winter Conference

Aalborg, Denmark, 20-22 January, 2011
The conference is open for all PhD students working within the broad field of economics and management of innovation and organizational change. We invite papers aiming at enhancing our understanding of the dynamics of technological, structural and institutional change at the level of firms, industries, regions and nations. DRUID is the node for an open international network - new partners are always of interest (we of course encourage DRUID Academy PhD students and students connected to the ETIC PhD program to submit an abstract as well). Do not hesitate to apply even if you have not been in contact with DRUID previously.

 

>SUBSCRIPTIONS & COMMENTS                                                 [Table of Contents]

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

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