Several scholars (Castells, Porter etc.) have directed their attention to Finland….
“ Finland in particular appears to be well-positioned to compete in the Creative Age with a high level of overall creative competitiveness and rapid growth in its creative capabilities” (Florida and Tinagli, 2004)
”… whereas cities such as Stockholm, Helsinki and Stuttgart have growing populations, and are known for high skills and good access…”
Indeed the role of knowledge economies (ICT) is important in Helsinki metropolitan area
Employment: The role of creative and knowledge industries is very central ( 18 per cent in the knowledge industries). ACRE industries Sako Musterd 2008 27 Sofia 29 Riga 29 Budapest 18 Poznan 25 Leipzig 22 Toulouse 29 Munich 31 Milan 30 Helsinki 21 Dublin 25 Birmingham 22 Barcelona 26 Amsterdam Employment in creative and knowledge intensive industries (%)
And then, we have Nokia
In 2002 Nokia’s proportion of the national research & development (R&D) in Finland accounted for 63 per cent.
Nokia is also the largest single investor in R&D for
the whole of Europe (Industrial Investment Scoreboard 2008)
So what happend?
It was the year 1879
(Communication capabilities have been central in the Finnish history, especially for its military efforts under the domination of the Swedish and the Russian Empires).
when a political decision by the Finnish Senate under the Russian empire, was made to privatise Finnish telephone activities and to open them to the international market (to keep them locally owned and controlled).
By the late1880s, there were several competing telephone manufacturers in Finland, including Bell, Ericsson, and Siemens.
This created early competitive advantages for the development of advanced communication technologies as well as for sophisticated customer demand
( By 1938, there were already 815 private telephone operators in the country)
The history has also resulted a specific educational ethos
As a part of a long egalitarian tradition
No class divisions
the attendance has been similar across all social strata (Alapuro, 1994; Mäkelä, 1999).
Can also be seen in the labor market participation of the women
Finland could not afford to have any part of its population left out.
The main form of national policy to support the development of creative and knowledge industries has been to raise education levels
Educational institutions were spread to every possible location regionally.
The expansion of the university network from three to twenty
This also helped to establish public financing institutions for business-oriented research and development The National Technology Agency (Tekes), the Technical Research Centre of Finland (VTT) and the fifteen Employment and Economic Centres (TE-centres)
Until 1975, this was mainly done to create an industrial society.
In order to protect itself from foreign pressures, Finland has put a lot of focus on national political integration (Kekkonen, Allardt 1964).
This national integration had to be achieved through consensual solutions, which produced decades of political and social networking, linking all fragments of the Finnish elite (the political, the economic, and the intellectual).
In other words, the networking is not recent but rather a long standing national tradition .
Firms collaborating in innovation with higher education institutions, by size, 2002-2004 Source: OECD Science, Technology and Industry: Scoreboard 2007
This can still be seen in current policy practices
The formulation of the Helsinki Region Innovation Strategy (2005)
Over one hundred actors actively involved
including mayors of cities, heads of educational units and heads of big industries and economies.
The formulation of innovation strategies at the national level
over 300 experts were involved
” Thus, the implementation is easy and fast - as was seen in the last resession – the whole boat was turned over one night ” Eero Holstila, Director the Office of Economic Development, City of Helsinki - interview for the ACRE project
And finally - Early internationalisation
As the domestic market has always been too small for the major businesses (pulp and paper earlier), the country traded globally already long before the era of globalization. Policy-makers learned to pay close attention to the needs of large exporting corporations and to co-operate with them, and vice-versa.
A special challenge - what still is under preparation
the local city-regional policies
City-regional co-operation is looking for its mode
(with a ”help” from the government – a expert group gathered by the Ministry of Finance delivered its study to the Minister just last week on the economic interaction and development factors between the central city and the suburban municipalities).
Also, the first national metropolitan policy document is still in preparation (Asta Manninen has been actively involved).
Problems lie more on the local level…which is also reflected in the ACRE survey: (Kepsu & Vaattovaara 2008)
To conclude: Origins for high education, networking and knowledge industries (telecommunications) were established already way before the current ideas of the new economy or competitive advantages were born – but they do form a solid base for current action
Almost hundred years later – the famous words, by Porter (2004, 16) To succeed in the new economy….
“ The competitive advantage lies increasingly in local things – knowledge, relationship and motivation – that distant rivals cannot replicate …”
The one issue – Conclusion- beyond policies
The structural counterpart of locally constructed historic traditions (networking, education and early internationalisation + telecommunication) and the requirements of new economic success have given a competitive advantage to the rapid rise of Helsinki in Finland as an international hub of the knowledge industries.