Path Creation: Co-creation of Heterogeneous Resources in the Emergence of the Danish Wind Turbine Cluster

Abstract

This paper employs path creation as a lens to follow the emergence of the Danish wind turbine cluster. Supplier competencies, regulations, user preferences and a market for wind power did not pre-exist; all had to emerge in a tranformative manner involving multiple actors and artefacts. Competencies emerged through processes and mechanisms such as co-creation that implicated multiple learning processes. The process was not an orderly linear one as emergent contingencies influenced the learning processes. An implication is that public policy to catalyse clusters cannot be based on an assumption that linear learning dynamics will unfold.

Notes

Several other devices framed the economics of wind power. For instance, wind turbines were classified as a building. Consequently, wind entrepreneurs could get a 20-year loan rather than a loan for 4–6 years if it had been classified as a machine.

Stoddard (1986) noted that, of the 25 most important research reports of the 1980s on wind turbine designs, 12 came from the Danish TRC.

The Public Utility Regulatory Policies Act (PURPA), part of the National Energy Act of 1978, attempted to eliminate barriers for wider adoption of renewable energy sources in the US. Utilities were compelled to buy electricity from independent power producers at fair prices. Jointly with federal and California tax credits amounting to some 40–45%, these incentives encouraged the use of alternative energy (Gipe, 1995). In fact, tax credits were so high that profits were made even from wind turbines that generated hardly any electricity.

Interview with James March by Diane Coutu (Harvard Business Review, October 2006, p. 88).