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

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)

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

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

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%.

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

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

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

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

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)

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).