Collective entrepreneurship: the Basque model of innovation

ABSTRACT

The Basque Country enjoys a distinctive status as an old industrial region that successfully met the economic challenges of the 1980s and 1990s, so much so that today it is lauded by the Organisation for Economic Cooperation and Development as a regional transformation success story. The article seeks to explain this experience and assess its implications in and beyond the Basque Country. Firstly, it defines the Basque model and traces its institutional evolution from the 1980s to the present day, highlighting the strengths and weaknesses of the model. Secondly, it examines how the Basque model is adjusting to and addressing the challenging agenda of smart specialization, the latest regional innovation programme in the European Union. Finally, it uses the Basque experience to illuminate four key issues in regional innovation policy studies, namely the balance between continuity and novelty, the policy complexity problem, the interplay between intra-regional and extra-regional learning and state-centric versus network-oriented approaches to place-based innovation.

KEYWORDS:

• Basque Country
• RIS3
• entrepreneurship
• innovation

Acknowledgements

I would like to thank the following for comments on an earlier version of the article and/or for discussions about the history of regional innovation policy in the Basque Country: Marijo Aranguren, Gorka Espiau, Juan Jose Ibarretxe, Mikel Landabaso, Edurne Magro, Mikel Navarro, Cristina Oyon, Carlos Pena and James Wilson. I would also like to thank Elvira Uyarra for hosting the ‘RSA Conference on Regional Innovation Policy Dynamics' at Manchester University (23–24 September 2013) where some of the arguments of the article were first presented. None of the aforementioned is responsible for the views expressed in this article.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. Until the financial crisis hit in 2007–2008, successive Basque Governments were able to draw on a highly devolved and extremely favourable fiscal settlement in which they even raised their own taxes. This fiscal settlement enabled Basque Governments to invest in a publicly funded regional innovation ecosystem, at the heart of which was the network of Technological Centres (see OECD, 2011).

2. The Department of Industry has traditionally been the most powerful department within the Basque Government. Under the current government, its name has been changed to the Department of Economic Development and Competitiveness. For the sake of consistency and clarity, I use its original name throughout this article.

3. Although the Commissioner has nominal control of the Basque S3 strategy, his power is compromised in practice by the fact that it is a part-time responsibility as his other duties include running the presidential office.

4. This is not to deny that the Basque Government has sought to benefit from international experience at many points in its history. For example, its regional development agency, SPRI, was inspired by the Scottish and Welsh Development Agencies; the Technological Centres were inspired by the Fraunhofer model in Germany and the Cluster Policy was inspired by and designed in association with Michael Porter. I am grateful to an anonymous referee for some of these examples.