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Regional innovation and competitiveness in a dynamic representation

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Abstract

This paper combines the various strands of literature on knowledge and innovation as drivers of regional growth in an evolutionary model, representing the internal dynamics of a regional system focusing on Arthurian dynamic increasing returns to scale. The model shows how different evolutionary patterns can arise starting from identical local systems, and that the effects of policies are different depending on the state of the system. Simulation evolutionary economic geography models also allow to represent the complexity of spatial economic development without radically simplifying it and to formalize concepts which are otherwise only expressed—by economic geographers—as logical arguments.

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Notes

  1. The technological gap is similar to the one used by the econometric cumulative causation approach (e.g. Fingleton 2001). Also in this paper, as in the CCA literature, the rate of technological progress ends up being the outcome of the gap and of the rate of technological progress in neighboring regions, as will be more evident in the multi-regional framework of Section 5.1. However, we are here interested in relative competitiveness (implying regional rankings) more than absolute, and the absolute rate of technological progress is hence less interesting than the relative one, so that it is the gap itself which ends up being the key variable of regional performance.

  2. Due to the existence in each region of diffusion and imitation processes from the external (Section 3.3), it is now clearer why also in this framework, as in CCA, regional innovation is the result of intraregional and interregional effects. The interest for gap itself is here more important than the rate of technological progress which produces it. See also note 1.

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Correspondence to Ugo Fratesi.

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Comments or discussions from two anonymous referees, Alberto Bramanti, Roberto Camagni, Bernard Fingleton, Fabio Fiorillo, Massimiliano Riggi and Lanfranco Senn are gratefully acknowledged. All possible errors and omissions remain mine.

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Fratesi, U. Regional innovation and competitiveness in a dynamic representation. J Evol Econ 20, 515–552 (2010). https://doi.org/10.1007/s00191-009-0169-1

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