Strategic RTD policy for regional catching up in the ERA

1. Strategic RTD policy for regional catching up in the ERA Stanisław Kubielas Warsaw University

2. Barcelona Target and the Era in an Enlarged Europe • Further falling behind • Increasing regional divergence • Dilemma – concentrate or diffuse RTD effort in the Era (duplication vs returns?) • Supply or demand forces at play? (Creating demand – absorption)

3. Spatial and temporal clustering of innovations – principle of insularity • Because - not in spite of - the lack of correlation between innovations; • Barriers to diffusion, limited transmissibility • Low spillover, clustering, time and place specificity of technical know-how • Rationale for regional RTD policy – silicon chips or potato chips? • Focus on microeconomic environment, not too aggregated, support regions rather than countries

4. Conditions for diffusion crucial to regional catchup • Transmissibility – dissemination policies • Capacity to absorb – infrastructure, education and training • Matching demand for innovations with R&D supply push • Demand factor of special relevance for accession countries

5. Barcelona objective can not be viewed purely as a supply push of diverting more resources to R&D. Any supply push has to be coupled with equal efforts to generate a demand pull for such R&D. Solow paradox of decreasing returns to R&D for countries close to world technological frontier might be repeated in catching up countries with R&D effort not matched by corresponding increases of demand for that new technology. The indirect cost of the Barcelona objective – that of creating the absorption framework conditions – might be much higher than raising R&D by 1%.

6. Multi-layer strategic RTD policy – ERA, nations, regions • Overcome fragmentation, duplication, scale effects, concentration • Adjustment of research priorities (easy in absence of priorities) • Creating supranational linkages/networking, support for infrastructure • RTD for innovative or absorptive capacities • Regional differences: mission vs dissemination oriented policies • Regional specificity of innovation systems – open method of coordination instead of harmonization since Lisbon • Crowding out (revenue trap) or crowding in (additionality)? • Mobility of researchers – a way to spillover

7. Use of modern tools for regional strategic intelligence • Identify comparative advantage – benchmarking (SWOT, taxonomy) • Identify demand for R&D and innovations – foresight • Setting local priorities – evaluation, technology assessment • Analytical search for priorities (not voting) as against available competences

8. Conditions for regional strategic intelligence to emerge • Awareness of common (encompassing) interest • Relative autonomy of regions – moderate level of centralisation • Threshold level of funding – reasonable management costs • Size and relative integrity of the region

9. Experience from an accession country - Poland • Ample evidence of demand pull mechanism (however insufficient) • Inverse relationship between GERD/GDP and GDP growth (Solow paradox) • Great challenge – to match RTD supply and demand at the micro level • Need to identify demand for innovations (both in enterprises and local communities) • Important step to couple structural funds with foresight (obligatory?) • Structural funds to realign domestic to foreign technology systems • Strategy for less advanced to grow: coupling traditional products with inputs of advanced technology; no need to be technology leader to grow • Twining, foreign consultancy, pooling of EU experts, aid from EU funds • University as a champion for regional development in poorly developed infrastructure

10. Debated issues - suitability of modern tools • Performance monitoring trap – procedures vs essentials (Columbus syndrome) • Foresight for advanced, imitation for less advanced regions, Poland A, B, C • Benchmarking: Barcelona target and equilibrium level of R&D (Warsaw contra the provinces) • Foresight or capabilities of system adaptation (abstract science, high culture, human capital)

11. Major examples of emerging regional strategic intelligence • Warsaw district– strategic development plan • Motorway A4 (agreement of four voivodships) –silicon valley • Association Aircraft Valley in South-East Poland • Integrated Operational Programme for Regional Development • Pre-accession programme: Improving institutional cohesion for innovativeness (consultancy of MERIT).