Abstract
This chapter reviews some key conceptual and practical barriers that have hampered territorial economic development prospects in most advanced countries for some time. It is argued in the paper that influential development thinkers and policy organisations, supranational (UNIDO; World Bank; EU) as well as national and regional became wedded in an unholy alliance of neoclassical economic dogma and neoliberal policy ideology during the period from approximately 1980 to the 2008 global financial crash and beyond to the time of writing (2015). In outline, neoclassical dogma stressed the virtues of spatial ‘specialisation’ as an economic development virtue. The heart of this perspective with its claimed inheritance from Marshall to Arrow to Romer coalesced in the nowadays nearly ubiquitous spatial policy image if not always the reality of “clusters”. The neoliberal accompaniment was that “efficient markets” were superior allocation mechanisms to markets shaped by policies to overcome “market failure”, “adverse selection”, and so-called “agency” problems. The great escape from such cognitive and policy “lock-in” involves demonstration in conceptual and many comparative empirical studies that regional knowledge and innovation flows were no longer, if they ever had been, vertical, linear and cumulative but horizontal, variegated and combinative. In this brief review evolutionary economic geography (EEG) is refashioned as evolutionary complexity geography (ECG) which, with acknowledgement to recent resilience issues, is grounded by reference to exemplars of transversality, which is the name for innovation and knowledge flows policy that overcomes the cognitive and policy lock-ins described above.
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Notes
- 1.
An anonymous referee queries this distinction. It is hoped that the following illustration is helpful. The price to a plumber to fix a burst pipe at a customer’s home may be €5 for travel, materials costing €2.50 and an hour’s labour at €10. However, the value of the service to the customer—who may have water leaking all over their house—is far greater than that, so the plumber typically estimates the price the customer will pay at €100. Investment bankers ‘arbitrage’ such ‘value to price’ differences for profit in the financial services industry.
- 2.
Krugman (1991) displays the centrality of innovation in his theory of city agglomeration while admitting it is simplistic: “There are assumed to be two technologies for producing manufactured goods: a “traditional” technique that produces goods under constant returns at a unit cost c1, and a “modern” technique with a marginal cost lower than c1, but that involves a fixed cost F per production site… If manufacturing is dispersed, an optimally located modern plant will be a distance of 1/4 from its average consumer, and will thus incur transport costs tx/4. On the other hand, if all manufacturing were concentrated at z = 0.5, an urban plant located at the same point could serve a fraction π of consumers at zero transport cost, and incur transport costs of only (l—π) tx/4…” This story bears an obvious resemblance to the Big Push story of Rosenstein-Rodan (1943).
- 3.
An anonymous reviewer holds that EEG after the Dutch approach should be cautioned against because it suffers from “ergodicity” i.e. all future states of the model must be in the model at the beginning. A priori, this seems unlikely for any kind of economic geographer given that in Boltzman’s initial formulation the term refers to a ‘…dynamical system which, broadly speaking, has the same behaviour averaged over time as averaged over space.’ Moreover, EEG research shows that ‘relatedness’ which equates very much to thinking on territorial knowledge dynamics (TKDs) includes ‘revealed related variety’ unpredictable ex ante but rather only understandable ex post.
- 4.
Thus a smartphone has a QWERTY keyboard, invented by Sholes of Milwaukee in 1878, a camera (Fox Talbot 1841; digital version Kodak 1975), a sound system (Edison 1877; digital version Alec Reeves 1938), Internet and email via packet-switching (Donald Davies 1965; ARPA/Vint Cerf/Robert Kahn 1969); social media on Web 2.0 (1999); “apps” innovated by Apple AppStore in 2008 and so on.
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Acknowledgements
The following colleagues assisted me with background information and advice in composing this chapter. In Sweden, Lennart Svenssen, Arne Eriksson, Carin Dahl, Helina Nilsson. In Italy, Marco Marchese, Jonathan Potter. In Portugal, Vitor Corrado Simoes, Artur da Rosa Pires, Ana Rita Cruz, Hugo Pinto Antonio Ramos Teresa Jorge, Alexandra Rodrigues, Jorge Brandão, Alexandre Almeida and Rui Montero. All are thanked and the usual disclaimer applies.
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Cooke, P. (2018). Evolutionary Complexity Geography and the Future of Regional Innovation and Growth Policies. In: Pinto, H., Noronha, T., Vaz, E. (eds) Resilience and Regional Dynamics. Advances in Spatial Science. Springer, Cham. https://doi.org/10.1007/978-3-319-95135-5_2
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