On the policy space of smart specialization strategies

ABSTRACT

This paper is about ‘smart specialization strategies’ as an innovation (or industrial) policy approach. Being a sector non-neutral policy, while promoting a bottom-up principle of entrepreneurial initiative and dynamics, ‘smart specialization strategies’ occupy a particular place in the innovation policy space. This place is naturally not only filled with ‘smart specialization strategies’, but also several other approaches in development policy and industrial policy share similar goals and logics. In the paper we will build the innovation policy space, emphasize two important bifurcations within it and explain why various policy approaches are located in the same subspace and what makes them rather similar in terms of governance principles.

KEYWORDS:

• Smart specialization
• new industrial policy
• policy design
• entrepreneurial discovery

Acknowledgements

I am grateful to the two anonymous reviewers for their comments and suggestions and I thank Henning Kroll and Roberta Capello for their encouragement and persistence.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. A very simple figure placed at the end of the paper supports our argument in both Sections 1 and 2.

2. A sector-neutral (horizontal) policy is a policy that addresses problems that are similar to any company and other innovation actors across sectors and fields. Such policy aims at improving general conditions and fixing generic problems, while minimizing the risks of distortions and government failures.

3. David and Metcalfe (2008) suggest that the term ‘innovation system’ has been misleading in directing attention to static and durable institutional structures, and argue for greater empirical and policy relevance of their conceptualization of ‘micro-systems of innovation’ as emergent properties of interactions among firms, research, suppliers and so on which develop (often only transiently) for the purposes of solving specific innovation problems. They write: ‘In a healthy ERA there would be countless numbers of specialized innovation systems generated at the micro-level; systems that are born and decay as new innovation problems are posed and solved’.

4. Setting up such a process in every European region has become an important objective of EU cohesion policy – known as RIS3 (see Foray, 2015; Foray, David, & Hall, 2009; McCann, 2015; McCann & Ortega-Argiles, 2015).

5. As a lesson from the first years of practical implementation in EU regions, it seems that in most cases, regions proceeded the other way: starting with the predetermination of domains and areas of potential specialization (based on different types of statistical representations or problem setting), they then hoped to find entrepreneurial discoveries within these domains (if they are lucky, they will find a few)! See Foray and Frenken (2016) to learn under what conditions such a reverse sequencing is relevant (which is notably the case in regions with poor entrepreneurial capabilities).

6. In ‘Choosing races and placing bets’ (Hughes, 2012), Alan Hughes reports on a policy proposal of the Council of Science and Technology (CST, UK) which shared at least the starting point of smart specialization. Through this proposal, the CST's objective was to advise the Government on ‘what would be the best areas to focus resources for science, technology and innovation, which could lead to applications with commercial or social benefits in around 5 years’. The proposal involved various steps to identify priority' areas, but it did not refer to any kind of self-discovery principle. I am grateful to one of the anonymous reviewers who mentioned this reference.

7. I am grateful to Dieter Ernst who mentioned to me the relevance of Hirschman's works to the analysis of RIS3 as a policy approach.