Economic development and evolving state capacities in Central and Eastern Europe: can “smart specialization” make a difference?

Abstract

We position “smart specialization” (SS) as the third external and conditionality-based reform of economic policy rationales – after Washington Consensus and Europeanization – in Central and Eastern Europe (CEE). We discuss what kind of state, policy, and administrative capacities, or routines, SS presumes. We show that over the years CEE economies have built very different routines, especially for policy coordination and public–private interactions. Design and implementation of functional SS strategies requires critical attention and development of these routines through contextual policy experimentation in all CEE regions. We provide some general guidelines for this.

Keywords:

• smart specialization
• state capacity
• policy implementation
• Central and Eastern Europe

JEL codes:

• L52
• O25
• O38
• P20

Notes

1. In this article, we limit our discussion to the CEE economies that entered the EU in 2004: Estonia, Latvia, Lithuania, Poland, Hungary, Czech Republic, Slovakia, and Slovenia.

2. The analysis is based on participant observations carried out in the framework of Innovation Policy Monitoring Programme of the Estonian Ministry of Education and Research (See: www.tips.ut.ee).

3. See article “Slovenian Competence Centers: A Tool for the Implementation of Smart Specialization Strategy.” Accessed May 15 2014. http://www.sure.si/en/obvestila/item/153-kompetnecni-centro-orodje-za-izvajanje-pametne-specializacije.

4. See article “Smart Specialisation Strategy – platform for a new chapter for innovativeness, entrepreneurship, development, research and innovation development.” Accessed May 15 2014. http://www.svrk.gov.si/nc/en/media_room/news/article/1328/5730/. Also, see the EU peer-review process of Slovenian SS strategy. Accessed May 15 2014. http://s3platform.jrc.ec.europa.eu/portoroz-may-2014.

Additional information

Funding

This work was supported by the Estonian Research Council under institutional grant [IUT19-13] and grant [ETF 9404], and by the European Social Fund through the Research and Innovation Policy Monitoring Program.