Science Cities, 2008

8/9/2019 Science Cities, 2008

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Science cities in the context of European and international

innovation policies

(Chapter for unpublished book on English science cities)

Olga Mrinska for ippr north, 2008

[email protected]

Introduction

The links between science, innovation and economic development first emerged as a subject

for research and policy-making in the mid-20th century. The shift from an industrial to a post-

industrial economy meant that in order for countries, regions and cities to enhance their

economic growth and competitiveness, they would have to find new roles and models for their

research and applied science facilities. Hence, science and innovation policies began to

emerge both at the national and regional levels to harness places existing intellectual

potential and to attract more talent and investment from elsewhere. This stimulated energetic

competition between places between cities and regions that were all aiming to become

beacons of science and technology. The further transition towards a knowledge-based

economy in the 1990s only accelerated this trend. The UKs most recent response has been

the Science City initiative, launched in 2004 when York, Manchester and Newcastle received

this status. Three more cities Birmingham, Bristol and Nottingham followed in 2005.

For the British Government, science cities are not only about achieving the goals of state

innovation policy (greater link between business and universities, greater commercialisation ofinnovations, etc). They are also a key instrument of the UKs regional policy. Science cities are

intended to attract resources and innovative production beyond the so-called Golden Triangle

formed by Oxford, Cambridge and London (the area with the highest concentration of scientific

and research activities in the UK) by redistributing research activities into parts of country

where the economic structure currently lacks innovation-intensive sectors. This is linked to a

variety of mechanisms to promote greater collaboration between scientific and research

institutions, the business community and local authorities (though not by allocating large

amounts of funding). In other chapters we analyse how successful this initiative has so far

been from different perspectives, including that of business community.

Of course, the UK is not the only country to pursue territorial innovation policies. Many other

countries in Europe and elsewhere have also developed policies to address regional gaps in

technology and innovation. Science cities, scientific parks or technopoles are one instrument

among many which have been used to stimulate more innovation-intensive production in

manufacturing and services and to strengthen the competitiveness of national economy

(others include stimulation investment in R&D, enhancing skills and reforming the education

system, deregulation and support of innovative businesses, and creating a beneficial

environment for intellectual property rights). The core goal of this chapter, therefore, is to

place the concept of science cities in the wider context of European innovation policies and to

look at international examples (from the EU, the US and Japan) of similar policies and their

effectiveness in spurring regional economic growth of the regions and improving citizens well-

being.
mailto:[email protected]:[email protected]:[email protected]


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Historical background

The idea of creating special regimes to promote science and research and enhance their

commercialisation through closer links with the private sector first emerged in the aftermath of

the Second World War. In the 1950 and 1960s, many states both in the developed world and

in the Communist bloc experienced rapid economic growth due to high levels ofindustrialisation, mass production, and higher demand for new technologies and know-how.

Those countries which already had extensive applied and basic research facilities aimed to

strengthen these facilities either to achieve higher economic success and raise the

attractiveness of their research and innovation facilities (e.g. the US), to harness the

effectiveness of those facilities through a higher concentration of human capital in growth

points (e.g. the USSR), or to enhance their military and defence capacities (both the US and

the USSR). Countries which lacked this scientific base but experienced tremendous economic

growth (Japan) designed scientific policies which would spur the creation of a solid science

base and effective applied research capacities which would then be able to compete with

stronger partners.

The ideas of science cities and technopoles thus began to emerge in the 1960s in different

parts of the world. The difference between a science cityand a technopoleis that the latter

represents a town or city that already has significant knowledge production capacities and

other important economic functions, while the former is based around newly-built facilities

(usually on green field or brown field), often in less developed areas with existing or relocated

scientific and educational institutions. When implementing science city projects, therefore,

governments and other actors usually face much higher costs related to building new

infrastructure and attracting researchers and entrepreneurs (though this is not always the

case). On the other hand, the science city model also provides an opportunity to create ideal

towns and settlements from scratch which have different functional zones and all necessarysocial and cultural infrastructure and are also more environmentally sustainable.

Projects related to technopoles focus more on linking existing infrastructure and facilities,

attracting more capital and human resources, and achieving higher commercial success from

research and innovation in order to stimulate activity in other economic sectors in the city or

region. One example of such policies is the French technopoles initiative in the 1970s and

1980s inspired by Perrouxs growth poles theory, when government research facilities were

relocated from Paris to technopoles or science cities in the less developed cities of Grenoble,

Lille or Toulouse (Cooke, 2006). Another example is Japans Technopoles programmein the

1980s, which used technology-led development policies to promote the economic

development of peripheral regions (Kitagawa, 2007).

There are usually three major drivers behind the creation of science cities national

government, universities, and regional/local government any one of which may play the lead

role. For example, Silicon Valley is a classical case of initiative spurred by the university

(Stanford University) which was supported by businessmen (often alumni of the same

university) and later by local/state authorities. The Research Triangle Park (RTP) in North

Carolina, USA, is an example of an initiative led by state and local authorities and then

supported by universities and private sector. By contrast, the famous Tsukuba science city in

Japan is the product of central government policy, which had the aim of decentralising

government research and engineering research institutes, intellectual resources and stateR&D funding outside the overheated Tokyo-Osaka area. Central government also drove the


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creation of science cities in France in order to reduce the gap between Ile-de-France and the

rest of the country though they were largely also supported by the local government and

business community. The Sophia Antipolis science city established near Nice in 1972 is one of

the most successful examples of this kind of intervention. The Soviet Union took this even

further, establishing around 70 science cities, most of them outside of the big European

conurbation zones in areas deep in Siberia (including the famous Akademgorodok nearNovosibirsk). All these initiatives in different parts of the world developed actively in the 1950s,

1960s and 1970s.

These areas all achieved substantial success in research and science, though the results in

terms of commercialisation were much more mixed. Soviet (now Russian) science cities

suffered harshly from the national economic crisis, and only now are some of them being

revitalised with substantial state investment and stronger links with the business sector.

Tsukuba science city is still one of the greatest growth poles for Japanese government

innovation policy and government R&D spending, as traditionally the Japanese business

sector, which is responsible for roughly four-fifths of total R&D spending, does not invest

substantial amounts in national research institutions and universities. RTP in North Carolina

has had periods of success but is currently reviewing its strategy in line with modern trends

towards the commercialisation of science and in response to harsh competition from similar

techno parks in the US and abroad. Silicon Valley has been a tremendous success thanks to

its emphasis on attracting business-minded researchers and creating conditions for their

businesses to grow and support its creative milieu. Its links with Stanford University remain

fundamental, but this science park is largely driven by private sector initiatives and their vision

for future development.

Challenges for the innovative economy in the EU

Traditionally, the countries of the European Union have been world economic leaders and

growth poles for innovation and science (alongside the USA and Japan). However, recent

trends in the world economy, which have seen a huge increase in flows of goods, capital and

people due to the dramatic impact of globalisation process, has led to substantial changes.

The rise of China, India, Russia and some Latin American economies means that the EU now

needs to compete not only with its traditional partners (the US and Japan), but also with these

emerging world powerhouses. Though these countries currently have much lower levels of

wealth and innovative development, they will have many opportunities to catch up thanks to

new trade patterns, foreign investment, global relocation of business and the intensification of

international production networks, all of which can drive innovative production and services.

As a member of the EU, the UK enjoys the benefits brought about by close economic

integration and social cohesion. However, it also shares the weaknesses of the European

economy, characterised in recent years by relatively modest rates of growth of productivity,

investment in education, science and R&D, inadequate deregulation, and a tendency towards

overprotective measures. Compared to the US, the EU has a much less innovative and

entrepreneurial business community, which invests much less in R&D. It also has an

inadequate skills mix which does not meet the demands of the modern economy. The EU

Single Market has had huge benefits for the manufacturing sector, but has so far failed to

accommodate the growing role of service industries, which remain highly disintegrated and

nationally regulated. Radical changes are needed, both in policy and in the behaviour of


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citizens and businesses, to reverse current trends which see Europe falling behind other world

powers.

This policy shake-up began in 2000, when the European Commission and the then 15

member states launched the Lisbon Strategy, which was meant to be an overarching policy

framework aimed at improving the productivity of the European economy and closing the gapin economic growth between the EU and its core competitors the USA and Japan. This was

Europes response to the growing challenges of globalisation and rapid technological

progress. It was acknowledged that in order for the EU to compete in the new global

environment, which is determined by intensity of knowledge and innovation in the total output,

radical changes in the national and community policies were necessary.

The Lisbon Strategy set a very ambitious target for the EU: to become the most dynamic and

competitive knowledge-based economy at the global scale by 2010. A multitude of priorities

and action plans in the macro-economic and micro-economic spheres were set up to achieve

this ambition. However, within a few years it became clear that the Unions ability to meet this

ambition was overstated, given the scale of task, the complexity of governance arrangements

and the relatively short timeframe. A major review of the Lisbon Strategy at the end of 2004 by

High Level Group chaired by Wim Kok concluded that Europe is still not ready to compete with

other world powers and actually risks falling further behind due to increased competition from

the growing economic powers of China and India (Kok 2004). The European economy

performed relatively weakly in 2000-2004, and investment in R&D was insufficient due to the

higher strain on public finances. Moreover, the EU enlargement in 2004 caused a drop in

output per head of 12.5 per cent (Kok 2004). The inconsistency of national regulatory regimes,

and the formalistic approach of certain member states towards meeting their Lisbon

obligations, meant that the EU as a whole was actually losing the momentum required to

achieve radical changes.

Among the key challenges identified in Kok review were the protracted internal negotiation

and complicated co-ordination procedures which must be followed to formulate, approve and

implement policies that take on board the positions of all member states. Such co-ordination

became even more challenging after the EU enlargements of 2004 and 2007. However, many

commentators agree that although the accession of 12 new members with significant

structural problems and lower levels of prosperity has caused some problems, it has on

balance had a positive impact on the Single Market. The market became more competitive

due to the expansion of consumer markets, the inclusion of a cheap but qualified workforce,

and the increased division of labour. The Union is in a quite unique situation where it can

enjoy the gains of both low-cost and high-cost economies, with steadily growing trade, capital

and people flows among 27 member states. Lower transaction costs and universal standards

across the Union make trade, especially in intermediate goods, much simpler. Central and

Eastern European countries are still more competitive markets for offshored manufacturing, as

distance remains an important factor determining the cost of production, especially due to the

recent dramatic rise in the price of fuels (see Castro Coelho et al 2008).

After this rather critical review in 2004, the Commission re-launched the Lisbon Agenda of

Growth and Jobs in 2005 (EC 2005), concentrating on fewer priorities and highlighting the

need to streamline governance structures and regulatory procedures. It was decided to

concentrate on two key tasks:


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1) delivering stronger, lasting growth; and

2) creating more and better jobs.

At the same time, all member states agreed Community Guidelines as an instrument to co-

ordinate their economic policies across the Union. These apply to all member states and to

the Community as a whole, and stipulate how specific macro-economic, micro-economic(including research and innovation) and employment policies can contribute towards growth

and creating jobs. Each member state brought their commitments and measures together into

a three-year National Reform Programme, while the Community measures were brought

together in the Community Reform Programme 2005-2008. An annual monitoring mechanism

was set up to follow progress at the community level.

Progress in achieving the Lisbon targets is measured by several publications. The main

instrument for cross-European benchmarking of policy performance and meeting Lisbon

commitments is the European Innovation Scoreboard (EIS) (latest edition available for 2007)

supported by the Commission. There are also annual assessments by the EuropeanCommission itself (see EC 2007) and independent assessments such as the Lisbon scorecard

compiled by the Centre for European Reform (see Barysch et al 2007).

The state of innovation and research in the EU

So how well are the EU and its member states performing against the targets they set

themselves, and are they on course to achieve their commitments? Two policy spheres of the

Lisbon Strategy are particularly important: research and innovation. Data from the EIS,

Eurostats Community Innovation Survey (CIS), and a few other sources can be used to

provide some answers to this question.

Investments in R&D are usually used to measure the scale and effectiveness of state research

and innovation policies be that government investments, business investments or

investments by higher education institutions. The scale of investment was also selected as a

key target for achieving the Lisbon Strategy when the EU committed to reach 3 per cent of

R&D expenditure as a share of GDP by 2010.

The EU as a whole traditionally lags behind its main competitors the US and Japan in the

scale of both government and business R&D investment. Within the EU, however, levels of

investment are quite diverse. Some countries are already investing above this threshold (see

Table 1), while others are lagging well behind (new member states) or invest below their

potential (the UK, France and Germany) though many low-performers at least have highergrowth rates of R&D investment, which could be explained by their catch-up innovation and

research strategies (Table 1).

As this is an area which is mainly regulated by national legislation, countries often chose not

to follow community-set standards and priorities. For example, the UK has declined to set a

2010 national target like all other EU countries did, and its national policy agenda (the Science

and Innovation Investment Framework 2004-2014) is underpinned by a target of spending 2.5

per cent of GDP on R&D by the year 2014. The EC continues to press the UK Government to

use the Lisbon Strategys 2010 target so that the UK can feed more coherently into the overall

Lisbon process.


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Intensity of investment is not everything, however, and experts argue that innovation

efficiency1 is no less important (INNO-Metrics 2008). If a country has trouble transforming its

inputs into meaningful outputs and increasing the productivity of its outputs by applying

innovation, then pouring more money either into R&D or into education and science might not

resolve the problem. Different countries have different approaches to transforming innovation

inputs (education, investment in innovation, innovation activities at the firm level, etc.) intoinnovation outputs (firm turnover coming from new products, employment in high-tech sectors,

patents, trademarks, designs etc.) and policy responses should thus be different as well

(Hollanders and Esser 2007).

Based on these differences, the ECs policy recommendations are either concentrated on

increasing inputs if the country already has a high level of innovation efficiency (like Germany

or Luxembourg) or increasing innovation efficiency if this level is low (for example in Poland,

Greece or Hungary). There are also countries that lag behind in innovation efficiency only in

certain areas, for example the UK has low efficiency of intellectual property outputs and needs

improvements specifically in this area, while Norway and Spain should improve their efficiencyin the application of innovations (see Hollanders and Esser 2007).

According to the EIS, EU countries are divided into several groups depending on their

performance in innovation over the last five years (Figure 1 in Addendum). This classification

is based on the Summary Innovation Index (SII), which consists of 25 innovation indicators

grouped into five dimensions: (1) innovation drivers; (2) knowledge creation; (3) innovation

and entrepreneurship; (4) applications; and (5) intellectual property. As well as data from the

27 member states, this scoreboard also includes data on other developed economies, such as

the US, Japan, Canada, Australia, Israel, Iceland, Norway, Switzerland, and the EU candidate

countries (Croatia and Turkey).

These countries are split into four groups2 depending on their SII score (INNO-Metrics 2008):

- innovation leaders: Sweden, Switzerland, Finland, Israel, Denmark, Japan, Germany,the UK and the USA;

- innovation followers: Luxembourg, Iceland, Ireland, Austria, the Netherlands, France,Belgium and Canada;

- moderate innovators: Estonia, Australia, Norway, Czech Republic, Slovenia, Italy,

Cyprus and Spain; and

- catching-up countries: Malta, Lithuania, Hungary, Greece, Portugal, Slovakia,Poland, Croatia, Bulgaria, Latvia and Romania.

One important trend in the SII over the last 5 years is that there is a gradual convergence

between different groups of countries, and the gap between innovation leaders and moderate

innovators/catching-up countries is reducing. This is because the catching-up countries have

the highest dynamics of SII growth and there is some progress in moderate innovators while

the innovation leaders and followers are effectively treading water.

1Innovation efficiency is the ability of firms to translate innovation inputs into innovation outputs. The

concept of innovation efficiency is used in the EIS and defined as the ratio between the composite indexfor inputs and outputs, assuming linear relationships between them.2

Turkey is not included as it performs very lowly on all indicators and represents a separate cluster ofunder-performers


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According to the EIS, there is also another challenge which requires immediate action from

member states and the EC. Innovation and research activities have traditionally been stronger

in the manufacturing sector, which has also spurred policies targeted at increasing the

innovativeness of manufactured goods. Innovations from the manufacturing sector were also

often used in services. Consequently most of the data which is used for analysing the level of

innovativeness in the EU covers the industrial sector and pays considerably less attention toservice sectors. For example, until recently most of the data in the Community Innovation

Survey, (the most important company-level source of information on innovation in the EU) was

about manufacturing, as it was designed to measure innovation in this sector. Yet the

importance of services, especially knowledge-intensive business services (KIBS)3, for the

performance of national economies is already large and is growing continuously. In 2004,

services contributed 40 per cent of all employment in the EU254 and 46 per cent of all value

added in the EU25, and the share of KIBS in value added grew by 6.8 per cent from 1999 to

2004 (INNO-Metrics 2008). This is a global trend: in the US, for example, services contributed

three-quarters of the increase in national productivity since 1995 (Bosworth and Triplett 2007).

There are also a growing number of innovations which are services-specific, for example inthe areas of logistics, software, etc.

There are also distinctive differences in sector innovations across the EU countries: evidence

from the CIS and the EIS suggests that the innovation performance of several new member

states in services is much higher than in overall innovation. More developed countries

innovative performance is still stronger in manufacturing, which is already not enough to

achieve a high overall level of innovativeness of the economy where the share of

manufacturing is continuing to fall. Hence if new member states continue their existing positive

dynamics in service innovation, in the mid-term perspective their overall level of innovation

might catch up with the old member states which are better at innovation in other sectors. Inany case, there is a strong need for policies aimed at promoting and nurturing innovation in

services, especially KIBS. This is also confirmed by the opinions of managers of service

companies (from the CIS), who are more concerned than their peers in the manufacturing

sector with inadequate intellectual property regimes, poor access to public science and the

lack of financial support (Eurostat 2007). The EC is thus trying to focus its efforts on promoting

this policy area as a high priority for community and national action.

Policy responses

There has been substantial progress towards achieving national and community targets on

innovation and research policies5, which are an integral part of the Lisbon Strategy, but this is

still not sufficient to meet the final goal. Furthermore, progress has been patchy since

countries that are at different stages of integration into European governance structures and

the Single Market have responded differently to their obligations.

3KIBSincludes Computer and related activities, Research and development, Architectural andengineering activities and consultancy, and Technical testing and analysis4

EU25 all EU member states except Romania and Bulgaria

5Research policyis predominantly directed at attracting more investments into R&D, including from

the private sector, while innovation policyaims to enhance the capacity to produce and commercialise

innovations and create the right business environment for the diffusion and adoption of newtechnologies (EC 2007)


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The picture becomes even less optimistic in the light of the recent global financial crisis, which

is leading most of the developed economies of the West into an economic slowdown with the

potential of recession. This means that there will be less public funding available, and meeting

the target for R&D spending will be even more challenging, especially for those states which

are lagging furthest behind (Table 1). Some EU states, such as Portugal, Latvia and Denmark,have nonetheless committed themselves to increase R&D spending despite these financial

constraints, while others have not made the clear budget commitments which would be

necessary to meet the 2010 target (EC 2007).

Most member states have developed coherent innovation strategies in line with their

obligations in the National Reform Programmes 2005-2008. They are also changing

governance structures in order to create more integrated and coherent research and

innovation policies, engaging a wider circle of sector government agencies and social

stakeholders. Some countries progressed well in the area of using public procurement policies

to stimulate greater innovation (e.g. the Netherlands and Lithuania), or even to promote anenvironmentally-friendly procurement system through innovation (e.g. Greece). In turn, the EC

is in the process of completing a handbook which will guide member states on how to use

public procurement rules to stimulate innovation (EC 2007). Most member states made great

efforts to simplify access for businesses to domestic and international capital, especially risk

capital. This is particularly important for new member states. The EC has also amended its

State Aid Guidelines for risk capital in order to simplify access to finances.

Simplification of the legal system in the area of intellectual property rights (IPR) has been

identified as one of the main priorities of revamped Lisbon Strategy, and some member states,

in particular Finland, Belgium, the Netherlands, and Latvia, have achieved good progress inthis area (EC 2007). Others are still lagging behind, especially in areas such as accessing

university inventions and strengthening universities capacity in patenting. The UK is one of

the countries which face big challenges in this area. At the same time, the EC needs to do

more to create a more coherent and harmonious environment for IPR across the Union in

order to promote greater exchange of ideas and cross-fertilisation.

It is important to look at the regional aspects of innovation policies and their impact in different

countries. There was definitely more co-ordination between national and regional innovation

policies across the EU over the recent years. More localised approach to stimulate innovative

businesses was strengthened by newly introduced community instrument called JEREMIE

(Joint European Resources for Micro to medium Enterprises) funded jointly by the EC and

European Investment Fund. Most EU member states have also developed national

instruments aimed at closing the technological gap between regions by bringing together

universities, research institutions and businesses either in the form of technological poles

(i.e. science cities, science parks), networks, incubators or clusters (EC 2007). Yet very few

have genuinely regional innovation policies or systems, rather concentrating on small-scale

reactive (rather than proactive) measures to complement the national agenda. There is also

not enough cross-border innovation collaboration, which will be essential if the EU is to be

truly united in achieving high innovation productivity and efficiency.

In general, there are three main types of regional innovation system (Cooke 2004): (1) agrassroots systemwhere innovation is generated and organised locally and where finances


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and competences are diffused locally without much national and regional intrusion. This

system is typical for Italy; (2) a network systemwhere there is close interaction between the

tiers of government and different sectors (business, government, research), shared

competences and a good mixture of exploration and exploitation innovation activities.

Germany is one of the best examples of this system; and (3) a dirigistesystemwhere

innovation occurs as a product of central government policy, funding is centrally driven, andresearch competences are linked to the needs of large companies whose sphere of interest

expands beyond the regions borders. France is a good example of such system.

In all of the above systems, national governments have attempted to create local or regional

growth poles for research and innovation which would promote scientific and research

excellence, lead to higher rates of science commercialisation and attract both domestic and

foreign investment. The Sophia Antipolis science city in the Alpes-Maritimes region of

France already mentioned above is an example of long-term national policy aimed at

decentralising the research and innovation capacities. Established around a newly-created

university, this science city after many years of targeted state and regional support hasachieved recognition of a genuine innovation pole from both local and especially foreign

businesses. It is not only financial incentives which now attract here the highest amount of

foreign direct investment in R&D among French regions. A large number of solid innovative

companies from around the globe, mainly specialising in ICT, environmental and life sciences,

satellite navigation and service innovations, making a base there are also drawn by the

richness of the innovative milieu and the proximity of like-minded businesses.

Germany has created its own science cities initiative, but on a very different, purely

competitive basis. Since 2004, the German Science Foundation has selected a City of

Scienceeach year a city or town which submits the most convincing bid to use theirpotential in science, research and technology to full capacity, to inspire the regional public with

science and to forge links between science, economy, culture and the municipality. The

financial support received by the winner is rather small compared to other available resources

in R&D, but is effective since the process spurs partnership between research institutions,

businesses and local authorities who must collaborate effectively to develop and implement

the proposal. This creates a base for further partnership, and after the annual term cities are

usually well-prepared to extend their innovation activities by tapping into public (mainly from

the Lnder) and private sector money. Among the cities and towns which have so far won the

title of science city are Bremen, Dresden, Magdeburg and Jena.

There are very few cases of trans-border collaborative networks in the EU aimed at

enhancing the economic growth of the area through greater emphasis on innovation and

research. The EC is trying to stimulate more such networks to be established across the

Union, but the process is far from straight-forward. One of the most successful examples is

the Meuse Rhine Triangle (MRT) a joint initiative of four regional development agencies

from Germany, Belgium and the Netherlands. Building upon its high education and research

potential (there are seven universities in the area), its industrial past and innovative present,

its extensive transport infrastructure and its prime location in relation to big consumer markets,

the MRT has managed to attract a substantial amount of domestic and foreign investment and

now houses many large innovative companies in sectors such as automotive industries, life

sciences, ICT and logistics. The MRT receives funding and support both from national and

regional governments and from the EU.


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The MRT is a great example where several nearby cities/regions with similar specialisation

and research profiles have united their efforts to create more ambitious strategy and facilities

in order to attract a greater number of innovative businesses and strengthen the development

of all partner regions. There is also great potential for developing cross-national networks

between regions/cities located at some distance from each other but specialising in the samearea. There are already some initiatives in this sphere, for example the Networks of

Excellence introduced in the EU Sixth Framework Programme.

Conclusions

There are many examples in the history of research and innovation policy across Europe and

around the globe when governments have used regionally targeted initiatives to address local

economic problems, narrow regional gaps in technology or spur economic growth by

stimulating more innovative activities. There are various different stimuli and drivers behind

initiatives such as science cities or technoparks and there are different innovation systemsunderpinning these policy instruments. Yet the objective is often similar: to reach higher levels

of prosperity and productivity by creating the most beneficial environment for collaboration

between universities, research institutes and businesses, maximising the gains for the local

economy from greater commercialisation of innovation by strengthening collaboration with

local and regional government agencies, and by attracting more investment, both domestic

and foreign.

There are also lessons to be learnt from the various approaches employed in different

countries, though none of them can simply be taken as a model for replication since local

conditions and the specific collaborative links between core stakeholders will differ from placeto place. Nonetheless, science cities in the UK can learn lessons from elsewhere in the EU

and further away, and they should also make the best possible use of the policy framework of

Lisbon Strategy for Growth and Jobs. Through closer engagement with the Government, the

EC or other likeminded science parks in Europe, the UKs science cities could tap into greater

resources and more effective instruments which would contribute to the implementation of

local projects and make their capacities more appealing to domestic and foreign

entrepreneurs.

Central government and regional/local authorities in the UK should work together to create

optimal regulatory and investment regimes to stimulate greater innovativeness in

manufacturing and especially in services, thus securing higher productivity rates and greater

economic prosperity. The diffusion of innovative and research activities outside the Golden

Triangle is a positive and necessary step, but this should be seen as a way to stimulate

greater R&D investment from business (currently insufficient when compared to other EU

countries, the US or Japan) rather than dragging cities into counterproductive competition and

rivalry for scarce state investment. Indeed, science cities should try to engage the business

community as much as possible and should make the most of the opportunities provided by

the European Union: community policy instruments, Single Market initiatives, networks of

excellence etc. While the EU may not yet be the most competitive knowledge-based economy

in the world, over the mid- to longer term the prospects for EU innovation are strong,

particularly if there is continued integration in science and research creating an effective single

environment for innovation and growth.


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employment. Report to the European Commission from High level Group available

athttp://europa.eu.int/comm/lisbon_strategy/index_en.html
http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://europa.eu.int/comm/lisbon_strategy/index_en.htmlhttp://europa.eu.int/comm/lisbon_strategy/index_en.htmlhttp://europa.eu.int/comm/lisbon_strategy/index_en.htmlhttp://europa.eu.int/comm/lisbon_strategy/index_en.htmlhttp://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51http://www.proinno-europe.eu/index.cfm?fuseaction=page.display&topicID=282&parentID=51


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Table 1: Spending on R&D in EU countries, 2005

Country GERD as % of GDP Average annual

growth of GERD, %,

1995-2005

BERD, % of total

R&D expenditure

Sweden 3.82* -0.3 74.7

Finland 3.45* 4.4 62.2

Germany 2.51 2.1 27.2

Austria 2.45 7.2 54.5

Denmark 2.43 5.9 57

France 2.12 3.6 44.2

Belgium 1.83 2.4 57.5

UK 1.76 1.3 49.0

Netherlands 1.72 3.4 26.3

Slovenia 1.59 6.3 54.1

Lithuania 1.57 17.0 16.4

Luxembourg 1.57 5.3 42.6

Czech Republic 1.54 10.3 50.5

Ireland 1.32 10.9 44.0

Spain 1.16 11.8 24.8

Estonia 1.14 22.2 45.8

Italy 1.10 5.8 na

Hungary 1.00 15.5 63.4

Portugal 0.81 3.4 20.8

Latvia 0.69 5.6 36.6

Greece 0.57 4.3 8.0

Poland 0.56 -1.2 65.4

Malta 0.55 na 65.3

Slovakia 0.49 5.1 29.0

Bulgaria 0.48 na 58.7


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Romania 0.46 na 34.3

Cyprus 0.42 17.3 30.3

EU27 1.84 3.4** 39.4

*above Lisbon-2010 threshold, **EU25, na

data not available

Source: Eurostat

Documents

Science Cities, 2008