The dynamics of regional learning paradigms and trajectories
08 Mar 2018-Journal of Evolutionary Economics (Springer Berlin Heidelberg)-Vol. 28, Iss: 4, pp 727-748
TL;DR: In this article, the authors propose the concept of regional learning paradigms and trajectories to study how alternative and more advanced learning processes arise in a region, and highlight the evolutionary path-creation strategies enabling a paradigmatic jump.
Abstract: While the literature is rich with studies on the identification of alternative types of learning processes that might exist in the real world, the identification of the determinants of the structural changes in regional learning processes is still an underexplored research field in regional innovation theories. This paper proposes the concept of regional learning paradigms and trajectories to study how alternative and more advanced learning processes arise in a region, and highlights the evolutionary path-creation strategies enabling a paradigmatic jump. By taking into consideration also learning modes typical of peripheral or declining industrial areas, generally left aside in previous theories, this new conceptual approach allows us to understand how more complex learning and innovation processes can emerge in all types of regions. From these reflections, spontaneous processes or policy recommendations to catch-up in the innovation ladder are highlighted for each type of region.
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TL;DR: The authors provide a formal definition of path dependence that disentangles process and outcome, and identify the necessary conditions for path dependence; distinguishing clearly between path dependence and other 'history matters' kinds of mechanisms; and specifying the missing link between theoretical and empirical path dependence.
Abstract: Path dependence is a central construct in organizational research, used to describe a mechanism that connects the past and the future in an abstract way. However, across institutional, technology, and strategy literatures, it remains unclear why path dependence sometimes occurs and sometimes not, why it sometimes lead to inefficient outcomes and sometimes not, how it differs from mere increasing returns, and how scholars can empirically support their claims on path dependence. Hence, path dependence is not yet a theory since it does not causally relate identified variables in a systematized manner. Instead, the existing literature tends to conflate path dependence as a process (i.e. history unfolding in a self-reinforcing manner) and as an outcome (i.e. a persisting state of the world with specific properties, called 'lock-in'). This paper contributes theoretically and methodologically to tackling these issues by: (1) providing a formal definition of path dependence that disentangles process and outcome, and identifies the necessary conditions for path dependence; (2) distinguishing clearly between path dependence and other 'history matters' kinds of mechanisms; and (3) specifying the missing link between theoretical and empirical path dependence. In particular, we suggest moving away from historical case studies of supposedly path-dependent processes to focus on more controlled research designs such as simulations, experiments, and counterfactual investigation.
32 citations
TL;DR: In this paper, the authors contribute to this debate by focusing on the long-term evolution of regional innovation processes, and propose a model of the long evolution of the regional innovation process.
Abstract: Conceptual reflections and empirical evidence on the evolution of regional innovation processes are increasing in recent years. This paper contributes to this debate by focusing on the long...
21 citations
Cites background or methods or result from "The dynamics of regional learning p..."
...…conceptual ‘archetypes’ of regional innovation patterns can be interpreted as regional learning paradigms, in that they represent modes of innovation and knowledge accumulation stemming from the functional, cognitive and relational characteristics of territories (Capello & Lenzi, 2018a, p. 162)....
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...The discussion of the local conditions enabling the different pathways/strategies is out of the scope of this paper and is fully presented in Capello and Lenzi (2018a, 2018b)....
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...In particular, upgrading can represent a viable and valuable option, less risky and costly than creation, for those regions suffering from bottlenecks deriving from limited density of economic and innovative activities preventing room for diversification (Capello & Lenzi, 2018a)....
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...Recent papers have, however, proposed alternative pathways to diversification to achieve such radical changes and have also investigated the drivers of alternative evolutionary paths (Asheim et al., 2016; Capello & Lenzi, 2018a; Trippl et al., 2017)....
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...REGIONAL INNOVATION PATTERNS: NOVELTIES WITH RESPECT TO EXISTING APPROACHES In the regional innovation patterns approach, learning processes vary across space (Capello & Lenzi, 2013a, 2018a)....
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TL;DR: In this paper, a gravity equation is used to model innovation cooperation, proxied by inter-regional co-patent applications, as a function of region-specific context conditions as well as technological and geographical distance.
21 citations
TL;DR: A “new normality” scenario is built, comprising the structural changes likely to take place in the aftermath of the COVID pandemic, and regional disparity trends will decrease as a result of a decisive rebound of those countries mostly hit by the pandemic.
Abstract: This paper addresses the important question "Which European areas will be able to better react to the crisis induced by COVID-19 and how regional disparities will look like?" To provide an answer, a "new normality" scenario is built, comprising the structural changes likely to take place in the aftermath of the COVID pandemic. To develop such scenario, two intermediate steps are necessary, in both cases relying on the use of the latest generation of the MAcroeconomic, Sectoral, Social, Territorial (MASST4) model. First, short-run costs of the COVID-induced lockdowns, in terms of missed GDP, are calculated for all European NUTS2 regions, needed because of the lack of short-run statistics about the extent of the regional costs caused by the lockdowns that will only appear in 2 years. Second, a long-run simulation of the economic rebound expected to take place from 2021 through 2030 is presented, assuming, among other trends, that no further national lockdowns will be undertaken in European countries. In the "new normality" scenario, regional disparity trends will decrease as a result of a decisive rebound of those countries mostly hit by the pandemic.
18 citations
Cites methods from "The dynamics of regional learning p..."
...In MASST4, this process is modeled with a new component of the regional sub‐model explaining the probability of a region to experience a structural evolution in its territorial innovation patterns (Capello & Lenzi, 2018)....
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TL;DR: The Fourth Technological Revolution has become a reality and profound changes and restructuring in the markets for 4.0 technologies are taking place with important spatial consequences as mentioned in this paper, and the paper d...
Abstract: The Fourth Technological Revolution has become a reality and profound changes and restructuring in the markets for 4.0 technologies are taking place with important spatial consequences. The paper d...
14 citations
References
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TL;DR: In this paper, the authors developed an evolutionary theory of the capabilities and behavior of business firms operating in a market environment, including both general discussion and the manipulation of specific simulation models consistent with that theory.
Abstract: This study develops an evolutionary theory of the capabilities and behavior of business firms operating in a market environment. It includes both general discussion and the manipulation of specific simulation models consistent with that theory. The analysis outlines the differences between an evolutionary theory of organizational and industrial change and a neoclassical microeconomic theory. The antecedents to the former are studies by economists like Schumpeter (1934) and Alchian (1950). It is contrasted with the orthodox theory in the following aspects: while the evolutionary theory views firms as motivated by profit, their actions are not assumed to be profit maximizing, as in orthodox theory; the evolutionary theory stresses the tendency of most profitable firms to drive other firms out of business, but, in contrast to orthodox theory, does not concentrate on the state of industry equilibrium; and evolutionary theory is related to behavioral theory: it views firms, at any given time, as having certain capabilities and decision rules, as well as engaging in various ‘search' operations, which determines their behavior; while orthodox theory views firm behavior as relying on the use of the usual calculus maximization techniques. The theory is then made operational by the use of simulation methods. These models use Markov processes and analyze selection equilibrium, responses to changing factor prices, economic growth with endogenous technical change, Schumpeterian competition, and Schumpeterian tradeoff between static Pareto-efficiency and innovation. The study's discussion of search behavior complicates the evolutionary theory. With search, the decision making process in a firm relies as much on past experience as on innovative alternatives to past behavior. This view combines Darwinian and Lamarkian views on evolution; firms are seen as both passive with regard to their environment, and actively seeking alternatives that affect their environment. The simulation techniques used to model Schumpeterian competition reveal that there are usually winners and losers in industries, and that the high productivity and profitability of winners confer advantages that make further success more likely, while decline breeds further decline. This process creates a tendency for concentration to develop even in an industry initially composed of many equal-sized firms. However, the experiments conducted reveal that the growth of concentration is not inevitable; for example, it tends to be smaller when firms focus their searches on imitating rather than innovating. At the same time, industries with rapid technological change tend to grow more concentrated than those with slower progress. The abstract model of Schumpeterian competition presented in the study also allows to see more clearly the public policy issues concerning the relationship between technical progress and market structure. The analysis addresses the pervasive question of whether industry concentration, with its associated monopoly profits and reduced social welfare, is a necessary cost if societies are to obtain the benefits of technological innovation. (AT)
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TL;DR: In this article, the authors explore the dynamics of allocation under increasing returns in a context where increasing returns arise naturally: agents choosing between technologies competing for adoption, and examine how these influence selection of the outcome.
Abstract: This paper explores the dynamics of allocation under increasing returns in a context where increasing returns arise naturally: agents choosing between technologies competing for adoption. Modern, complex technologies often display increasing returns to adoption in that the more they are adopted, the more experience is gained with them, and the more they are improved.1 When two or more increasing-return technologies 'compete' then, for a 'market' of potential adopters, insignificant events may by chance give one of them an initial advantage in adoptions. This technology may then improve more than the others, so it may appeal to a wider proportion of potential adopters. It may therefore become further adopted and further improved. Thus a technology that by chance gains an early lead in adoption may eventually 'corner the market' of potential adopters, with the other technologies becoming locked out. Of course, under different 'insignificant events' - unexpected successes in the performance of prototypes, whims of early developers, political circumstances - a different technology might achieve sufficient adoption and improvement to come to dominate. Competitions between technologies may have, multiple potential outcomes. It is well known that allocation problems with increasing returns tend to exhibit multiple equilibria, and so it is not surprising that multiple outcomes should appear here. Static analysis can typically locate these multiple equilibria, but usually it cannot tell us which one will be 'selected'. A dynamic approach might be able to say more. By allowing the possibility of 'random events' occurring during adoption, it might examine how these influence ' selection' of the outcome - how some sets of random 'historical events' might cumulate to drive the process towards one market-share outcome, others to drive it towards another. It might also reveal how the two familiar increasingreturns properties of non-predictability and potential inefficiency come about: how increasing returns act to magnify chance events as adoptions take place, so that
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TL;DR: In this article, the authors propose a model to account for both continuous changes and discontinuities in technological innovation, and define the process of selection of new technological paradigms among a greater set of notionally possible ones.
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