Inter-city competition has intensified and entrepreneurial regimes have become more popular for urban governance in the age of globalization. It is generally assumed that cities are in competition resulting in a zero-sum game. With a few exceptions, inter-city competition is considered a negative phenomenon, which can affect both cities and their wider regions negatively. But there is inadequate explanation for the emergence of such keen competition or solutions to such a situation. Indeed, cities often have close demographic, social and economic relations. They may also cooperate to enhance the competitive advantage of both cities. Currently there is no integrated study on inter-city competition and cooperation within a region. Furthermore, previous studies on inter-city competition and cooperation have focused on the initiatives led by city governments, whilst ignoring social relations and market-based economic relations. This chapter provides a holistic perspective in the examination of inter-city competition and cooperation that accounts for inter-city social, economic and governmental relations. The relations between Hong Kong and Shenzhen provide a good case for detailed study of inter-city competition and cooperation under regionalization and globalization. The chapter attempts to address a number of questions relating to inter-city competition and cooperation by differentiating inter-city relations at the macro level and firm level and separating the roles of firms and the city governments. This is achieved by reviewing the development of Hong Kong and Shenzhen and developing a conceptual framework to analyse the inter-city relationships. From this analysis implications for policy and future development are produced.
Browse by title
During the last few years research in regional economics has shown an eager interest in regional competitiveness, with policymakers also taking an interest in measuring and improving it. However, since the notion of regional competitiveness can be seen as defining that of economic growth, one can often observe that proposals for improved competitiveness combine traditional economic policy derived from endogenous growth theories with regional policies, primarily place-based economic development strategies. Therefore, there is a great need for synthesizing regional competitiveness and endogenous growth theories as well as providing an empirical framework for policy-oriented analyses. This chapter examines how regional competitiveness may be defined and conceptualized. It then concentrates on existing models of competitiveness and proposes a renewed pyramid model of regional competitiveness as a synthesis of endogenous regional growth theories. The competitiveness of 93 NUTS 3 level regions of four Central European countries (Czech Republic, Hungary, Poland, Slovakia) are empirically examined with the help of the pyramid model and a regional competitiveness function based on this model. This analysis is of considerable importance in the Central European post-socialist countries due to the gap in competitiveness that exists within the European Union between longstanding members and those countries joining in 2004.
Ron Martin and Peter Sunley
As is often the case with new ideas, both the notion of ‘regional competitiveness’ and regional economic ‘resilience’ have found currency among those interested in policy. Alongside the competitiveness concept, resilience has emerged as an imperative ‘whose time has come’ in policy debates around localities, cities and regions, propelling a new discourse of ‘constructing’ or ‘building’ regional and urban economic resilience. Indices of local and regional resilience have been compiled, akin to those for competitiveness. This chapter explores the issues that need to be meaningfully addressed before the concepts of local and regional resilience can be used in a productive manner within policy agendas and practices. Firstly there is a need for a clear definition, conceptualization and understanding of precisely what it is that the concept is trying to foster. In particular, there is as yet no theory of regional economic resilience, and relatively little discussion of how the notion relates to concepts such as regional competitiveness. Also, there is the issue of what determines the resilience of a regional or local economy: what is it that makes a local economy more or less resilient? Given these and other concerns, some economic geographers have questioned the applicability and relevance of the concept in regional and urban settings, and queried whether it adds anything new to our existing theoretical and explanatory schemas. These are all issues that need discussion and resolution before we can talk meaningfully about ‘building’ local and regional resilience.
The notion of competitiveness is widely used in economics and in regional sciences. Policymakers are also embracing and employing the concept of competitiveness as a principal objective of policies. There is general agreement that the definition of the competitiveness which matters in today’s economy is no longer a static concept, but rather an intrinsically dynamic one which stems from the renewal of advantage over time in order to maintain it through various types of innovation. Despite this, the dynamics of regional competitiveness are still relatively unexplored. There is insufficient awareness of how those factors associated with competitiveness are normally different not only in their essential characteristics, but also in how they deploy their effects over time. This implies that the study of regional competitiveness would benefit from a deeper understanding of how the regional economy works and the manner in which what happens in a node of the regional economy deploys its effects through second- and third-order impacts, often recursively, before its full impact can be detected. This is especially important for the policymakers expecting to achieve an outcome after a policy initiative, who are rarely aware of the time impact of policies. To show how the dynamics of regional competitiveness can be modelled using an intrinsically dynamic methodology, this chapter uses the one of the dynamic systems. In order to examine the evidence for the dynamic approach, example simulations are used to show how policies can achieve different impacts depending on the context in which they are applied. Conclusions for the use of this approach are then considered.
Edward J. Malecki
For many business leaders and policymakers, innovation and knowledge typify the characteristics of a knowledge economy and represent areas in which places compete. Rankings and comparisons among national and regional economies are now common. This chapter reviews the research on competitiveness, and demonstrates that knowledge, innovation and innovative capability are the core of economic competitiveness. The global innovation networks that enable creativity and innovation are formed in – and are attracted to – some places and not others. Although there are multiple dimensions of competitiveness, innovation is the fundamental dimension, comprised of local, global and virtual networks and systems of innovation.
Jan Fagerberg and Martin Srholec
How should differences in regional economic performance be explained? This chapter examines the different approaches to this question, including their empirical underpinnings, which have developed in the scholarly literature, with particular emphasis on identifying issues that continue to be of central importance for scholars in the field today. It is noted, however, that as far as theories and perspectives are concerned, the research area under scrutiny here is a highly porous one. In fact, the theoretical perspectives guiding researchers in this area usually apply to other spatial levels as well. For this reason, a very sharp distinction between the bodies of knowledge on, for instance, national and regional economic performance may not be very fruitful. The chapter presents an overview of how theoretical and applied work of relevance for the analysis of regional economic performance has evolved to its present stance. This leads to the identification of two central factors for regional economic performance, that is, capability building and specialization. Issues concerned with the availability of relevant data for exploring the relationships between these factors and economic development are then considered. The analysis shows that regional economic performance and capability building does indeed go hand in hand, while the evidence regarding the impact of specialization is more mixed. The chapter then concludes by considering lessons and implications for policy and future research.
Explaining the growth and change of regions and cities is one of the great challenges for social science. Cities or regions have complex economic development processes that are shaped by an almost infinite range of forces. The frames of reference employed to think about such processes are mostly borrowed from the ‘long view backward’, that is, to how the now-developed economies generated their urban systems at the time they developed, but such an approach must ‘average’ over many development experiences and hence may err in its attribution of causes or in the relationship between universally present causes and nationally or regionally specific contexts. Instead a focus on change and causality, studying cities and regions as forward-moving development processes, should determine what is most relevant in defining the ambitions of the field. This chapter, therefore, seeks to establish how future research investigating regional growth and change might best be adapted to meet the challenges outlined above by outlining the existing branches of spatial economics and their contribution to the debates on regional growth. In particular, attention is paid to the perspectives taken by the New Economic Geography and New Neoclassical Urban Economics branches of the discipline. The focus then turns to exploring the difficulties in identifying the direction of causal relations between the locational choices of firms and workers, as well as the limitations of the methods currently employed. The response of Economic Geography to these difficulties is considered, with the chapter concluding by outlining a framework intended to yield greater insights into processes of regional growth and change.
Contemporary Theories and Perspectives on Economic Development
Edited by Robert Huggins and Piers Thompson
Andrés Rodríguez-Pose and Callum Wilkie
The European Union (EU) is confronted with a host of ‘knowledge-related pressures’ from an evolving geography of innovation. Simply stated, the EU is in the unenviable position of losing ground to the United States in terms of knowledge production, research and innovation, whilst becoming increasingly susceptible to competition from emerging economies. The EU has responded to these pressures and the need to foster innovation by prioritizing research and development (R & D) investment. Such a strategy, however, may benefit some member states to a greater extent than others. More developed, ‘core’ territories are more conducive to knowledge-intensive, innovative activity and can better capitalize on increased R & D expenditure. Lagging, peripheral territories, on the other hand, are burdened by a host of structural, socioeconomic and institutional deficiencies that may inhibit the emergence of knowledge-intensive activity. The distance between the capabilities of peripheral regions and the technological frontier may be too great to overcome. The aim of this chapter is to address these concerns and assess the effectiveness of the EU’s approach. It explores whether increases in R & D investment have enhanced the innovative capacities, impelled economic growth, or improved labour market outcomes in the peripheral regions of the EU. The chapter undertakes an exploratory analysis of the correlations between increased R & D investment and changes in innovative capacity and socio-economic development within the EU. Factors which may explain these limited returns to R & D expenditure in peripheral territories are explored. The chapter concludes by introducing a series of policy implications formed on the basis of the analysis.
Robert Huggins and Piers Thompson
The field of regional development is subject to an ever increasing multiplicity of concepts and theories seeking to explain uneven development across regional contexts. One concept and theoretical tool that has endured and remained keenly discussed since the 1990s is ‘regional competitiveness’. Indeed, the rise of the concept has led to many frameworks and applications emerging and being employed in various contexts. Such variety has been both a blessing and a curse, with the notion of the ‘competitiveness of regions’ remaining an area of contested theoretical debate, especially arguments concerning the extent to which places actually compete for resources and markets. This chapter presents a broad overview of the evolution of regional competitiveness thinking, and aims to make clear the connections across a variety of contemporary regional development theories. The chapter firstly introduces the regional competitiveness concept and discusses its close association with schools of endogenous growth and development theory. The potential for measuring regional competitiveness is considered, before the chapter turns its attention to providing an introduction to some key contemporary theoretical perspectives on regional development. In particular the ideas of regional growth systems, institutions, ‘upstream’ behavioural theories of regional development concerning both cultural and psychological explanations, and concepts of regional ‘resilience’ and ‘well-being’ are considered. The chapter concludes by considering how the differing theoretical perspectives can be integrated, as well as providing an outline of the volume as a whole.