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Guest lecture on Knowledge economy and Urban Transformation

Guest lecture on Knowledge economy and Urban Transformation

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    Guest lecture - J Blanco - 9sep2010 Guest lecture - J Blanco - 9sep2010 Presentation Transcript

    • LECTURE KNOWLEDGE-BASED KNOWLEDGE BASED ECONOMY AND URBAN FABRIC TRANSFORMATION Crossroads between innovation and urban policies in US, Finland, Singapore and Chile GUEST LECTURER: Juan Bl J Blanco LECTURER: Jennifer Day ‘The Economies of Cities and regions’ The University of Melbourne Melbourne, Victoria 9 September, 2010
    • Silicon Valley Historic Development In Silicon Valley appears a new territorial location system, based in the proximity of  local actors. Those actors are highly dependant on face to face contacts to continue their process  Those actors are highly‐dependant on face‐to‐face contacts to continue their process of knowledge that characterize high technology industries  By the year 2008, it contained the most highly‐concentrated area of innovative firms  worldwide (More than 20.00 high‐technology firms are located in the area and  ld d ( h h h h l f l d h d several services and supports firms are ‘clusterized’ in the area).
    • Multimedia Super Corridor, MALASYA Corridor Singapore Science Park, SINGAPORE Dublin, IRLAND Guadalajara, MEXICO Kansai Science City, JAPAN Otaniemi Science Park, FINLAND Park Route 128 Massachustes, EEUU Illinois Technology and Reseach Stanford Research Park, EEUU Corridor, EEUU Bangalore, INDIA Campiñas, BRASIL Sofía Antípolis FRANCE Antípolis, Dalian Software Park, CHINA Dresden, GERMANY Taguspark, PORTUGAL Shanghai, CHINA Cambridge T h l C b id Technology park, UK k Telecom Corridor Dallas, EEUU Research Triangle North Carolina, Tel Aviv, ISRAEL EEUU Zhon Guan Cun, CHINA Chennai, Chennai INDIA Casablanca Techno Park, MORROCO Park Melbourne, AUSTRALIA
    • Globalization and Urban Transformation Nowadays, the most competitive metropolitan areas has been converted into complex  services platforms (De Mattos, et al. 2005) In that context, competitive cities has developed specific structures for those processes  In that context competitive cities has developed specific structures for those processes that are setting new challenges for its urban development:  Its leadership is highly‐dependant of the innovation capacity within its territory  This has accelerated the introduction of new building typologies that are affecting  the configuration of the pre existent urban fabric.  One of the most important outcomes of this process is the emergence of highly‐ concentrated productive processes in specific areas of the cities. In that context: a) What is the role of the urban fabric in fostering and improving such  concentrations? b)  What are the critical characteristics that allows the innovation process? c)  At what point is it possible to improve its strengthens? From which urban policies? 
    • Researcher in R&D Students Number of computers in 1998 per 1000 inhabitants Number of cellular phones in 1998 per 1000 inhabitants
    • Knowledge‐based Economy and Localization theories The localization of productive activities has been treated from different approaches ‐ sociological, geographical or economical, due to the understanding that a process of  profound transformation has been carrying out in recent years, affecting the  organization of production activities, where old hierarchical models has been  organization of production activities where old hierarchical models has been replaced for flexible and decentralized structures of organization (Vázquez‐Barquero,  2006).  This shift has been strongly accelerated in the 21st century, and could be described by  two stages:   A first stage where the knowledge is discovery as a determinant factor for the A first stage where the knowledge is discovery as a determinant factor for the  development of the enterprises; and  The current stage, initiated in the end of 1990s, where the role of knowledge is  directly related with the innovation capacity of the enterprise, putting strong  emphasis in the processes that allows its diffusion in an specific environment  (Dunning, 2001). 
    • Knowledge Economy and Territory Definition: The concept of Knowledge Economy seeks to describe the major  dependency on knowledge, information and skills from the public and private sectors.  (OECD, 2005) This definition derives from the role of knowledge in the majority of the contemporary  economic theories, where stands‐out:  Growth Poles Theory (Perroux): that bring forward the attraction capacity of those  enterprises with the ability of spread innovative practices and knowledge  Innovation Clusters Theory (Porter): reinforce the role of interaction between firms Innovation Clusters Theory (Porter): reinforce the role of interaction between firms  within a cluster to overcome technological needs (which give them an competitive  advantage)
    • 2002 PROXIMITY  KNOWDLEDGE  NATIONAL AND  DYNAMICS ECONOMY AND  REGIONAL  Rallet / Torre / Gilly /  LEARNING REGIONS INNOVATION  Pecquer / Bellet / Grosetti Pecquer / Bellet / Grosetti Mansell / Machlup /  p SYSTEMS Florida / Antonelli / Ferrao Lundvall / Cooke / Silva 1995 COMPETITIVIE  INNOVATIVE MILIEU  ADVANTAGE OF  INNOVATION  AND INNOVATION  NATIONS AND  +  NETWORKS REGIONS TERRITORIAL  TERRITORIAL Aydalot / Mailiat /  Porter / Dunning /  DEVELOPMENT Camagni / Storper /  Alburquerque Crevoisier 1985 INDUSTRIAL  LOCAL AND  DISTRICTS AND  ECONOMIC THEORY  REGIONAL  LOCAL PRODUCTIVE  OF INNOVATION AND  DEVELOPMENT SYSTEMS INNOVATION CYCLES INNOVATION CYCLES h / / Sthor / Quevit / Max‐Neef f Becattini / Bellandi /  Freeman / Soete / Dosi /  / Friedman / Boisier /  Garafoli / Pyke / Sforzi /  Pavitt / Rosenberg / Perez Vazquez‐Barquero Ybarra 1975
    • National Diamond (Michael Porter) Integrate previous works in competitive five forces theory (determine the competitive  intensity and therefore attractiveness of a market), value chain framework (chain of  activities for a firm operating in a specific industry) as well as his theory of  competitive advantage (position of a company in a landscape that allows higher  competitive advantage (position of a company in a landscape that allows higher return earnings).  Analysis of patterns of comparative advantage among industrialized nations.   Looks at the sources of competitive advantage derived from the national context.  It can be used both to analyze a firms ability to function in a national market, as It can be used both to analyze a firms ability to function in a national market, as  well as analyze a national markets ability to compete in an international market.  It recognizes four pillars of research (factor conditions, demand conditions,  related and supporting industries, firm structure, strategy and rivalry) l d d i i d i fi d i l ) SOURCE: Michael E. Porter (1990), The Competitive Advantage of Nations, New York: Free Press
    • FACTOR CONDITIONS RELATED AND SUPPORTING DEMANDS CONDITIONS INDUSTRIES S S STRATEGY, STRATEGY STRUCTURE AND RIVARLY
    • The Innovative Milieu* … the set, or the complex network of mainly informal social relationships on a limited  geographical area, often determining a specific external ‘image’ and a specific  internal ‘representation’ and sense of belonging, which enhance the local innovative  capability through synergetic and collective learning processes capability through synergetic and collective learning processes (Camagni 1991, 3). According to this theory, three main sets of elements mark creative/ innovative  milieus:  l  Effective actor relationships within a regional framework;   Social contacts that enhance learning processes,   And image and sense of belonging. External effects, favorable to creation, to location and to firms rooting ‐leading in fact  to regional growth‐ are due to the existence of a dynamic and located productive  system, of an innovative milieu. system, of an innovative milieu. * The notion of the innovative is mainly associated with the Groupe de Recherche Europeen sur les Milieux  Innovateurs (GREM I).  Innovateurs (GREM I). SOURCE: Camagni, R., 1991, 'Introduction: from the local ‘milieu’ to innovation through cooperation networks', in: Camagni, R. (ed.), Innovation Networks: Spatial Perspectives. Belhaven Press, London, 1‐9.
    • METROPOLITAN AREA Effective actor relationships within a regional framework Social contacts that enhance learning processes gp Image and sense of belonging. INNOVATIVE MILIEU Private Structure High‐Technology Firms Risk Capital Firms I+D Structure Industry Associations Technology Parks Business Parks Higher Learning  Institutions Government Structure Public Research Centers Government Administrative Bodies Public Financing Bodies
    • Knowledge and Territory Nowadays, the prominent role of exchange and learning processes in addition to the theoretical contributions of diverse disciplines has pointed to the relation between innovation and territory as the key factor to understand the success or failure of countries and regions in the knowledge economy paradigm paradigm. This relationship has been defined by the role granted to geographical and institutional proximity, as a facilitator factor for exchange and diffusion of knowledge:  Allows the reduction of transaction and negotiation costs  Favored the improvement of profitability of its enterprises (Vázquez‐Barquero, 2006). Despite of that, most of those approaches have developed a strongly deterministic view, since the success of a specific territory can not be exclusively associated to its learning and knowledge capacity (Hudson, 1999).
    • Spatial characteristics of Innovation The geographical and institutional proximity allows to improve the critical knowledge  and information transference to continuous innovation of its productive structures.  This characteristics are translated in diverse spatial configurations: a) Knowledge generation poles: higher education institutions, public and private  research centers, science cities, etc. b) Production hub of knowledge application: high‐technology firms, new industrial  districts, etc. c) Technological and firm concentration areas for knowledge spreading: technology Technological and firm concentration areas for knowledge spreading: technology  parks, new business centers, productive corridors, etc.
    • CLUSTERS: The Silicon Valley in the San Francisco Bay An spontaneous concentration of activities due to urban development regulations, land availability and local factors. It presents a high technological content following with an use of research and content, innovation centers located in the area It emerged from the incentive of professor from Stanford University towards its students to form its own enterprises in the surroundings of the university, with the aim to respond military research demand Nowadays, it operates through the recognizable centrality of the Stanford University,  Nowadays it operates through the recognizable centrality of the Stanford University in Palo Alto, connected with San Francisco and San Jose through the 1001 Highway,  airports and urban centers.  Gather more than 9.000 electronic companies and more than 5000 scientist, creating  an excellent innovation capacity that involves the whole region.
    • SAN FRANCISCO BAY METROPOLITAN AREA OF SAN FRANCISCO BAY, CALIFORNIA, US HIGH TECH FIRMS LEISURE FACILITIES HIGHER EDUCATION INSTITUTIONS INNOVATION SERVICES UNIVERSITIES
    • CLUSTERS: TI Cluster in Helsinki, Finland Clusters systems established above a regional structure designed in a national level, that includes university cities and fast‐growing areas In its beginnings it was almost entirely focused in communication technologies due to the complicated geography of the Finland territory. In later years, it has covered several related technologies (micro electronics, mostly) The parks networks of Helsinki covers a greater part of its urban area, mostly closed to university, research and transport centers. It represents a mix model within a metropolitan location but planned from the local model, government. Based its strengthen in the promotion of leading national firms (NOKIA), supported by a network of subsidiary firms and specific research centers. It is financed with investment from big firms, the government and risk capital. Most of the R&D activities are covered by the universities universities.
    • METROPOLITAN AREA OF HELSINKI, FINLAND HIGH TECH FIRMS LEISURE FACILITIES HIGHER EDUCATION INSTITUTIONS INNOVATION SERVICES UNIVERSITIES
    • CLUSTER: Singapore, the TI Island Public‐Private Model, planned, implemented and managed by the government,  supplying  to the country with the necessary R&D infrastructure to attract high‐ technology firms The innovation capacity is low, and most of them comes from foreign firms and big  government institutions. It has been developed from the ‘Technological Corridor’ initiative, with an extension  of 15 kms. in the southern part of the island, planned to be implemented in three  stages. The model it is supported with the lease of spaces within the Technology Parks, public  investment and return from R&D activities.
    • PORT METROPOLITAN AREA OF SINGAPORE, SINGAPORE HIGH TECH FIRMS LEISURE FACILITIES HIGHER EDUCATION INSTITUTIONS INNOVATION SERVICES UNIVERSITIES
    • The Role of Urban Planning The learning capacity of a territory is a strong factor in the competitiveness of cities and regions, but the role of the urban development, the change and adaptability of its institutions are also been considered key factors too (Vázquez Barquero, 2006). (Vázquez‐Barquero 2006) In that sense, the actors related with the production of knowledge, where outstand Higher Education Institutions, had had a strong prominence since the emergence of new policies and private initiatives based in strengthen those entities to encourage a knowledge‐based development.
    • Table 2 – Expenditure on R&D and Patents (selected countries) Patents granted by Patents granted by Total R&D Business R&D Effectiveness of USPTO USPTO per expenditure as % expenditure as % R&D expenditure million people of GDP of total (cost of each expenditure patent in US$ millions) CHILE 15 1.0 0.5 35 36.4 G-7 23.152 153 2.2 - - AUSTRALIA 1.047 53 1.5 48 5.8 N.Z. 165 41 1.0 37 5.0 CANADA 3.893 123 1.9 55 4.1 FINLAND 944 181 3.4 70 6.0 MALAYSIA 63 3 0.5 - 10.6 Source: Machinea and Vera (2006)
    • The Chilean Case: Santiago as innovative Milieu Santiago, the capital city of Chile, has undergone numerous changes in its urban  fabric due to the process of liberalization and globalization of its economy since mid  1980s.  The urban structure shows the consequences of this accelerated process of  development, affecting its social, physical and economical configurations, involving  the form and internal configuration of the city.  These processes, has been denominated by numerous authors (Castells, 2005, De  Mattos, 1999) as the 'globalization stage of Santiago'.  Even though the city has increased it competitive indexes[1], some authors are  concern with the real effects of this process, arguing that there is no real adoption of  'new leading activities' in its structure of production and that the city continues to be  a point of departure of commodities with few aggregate value (de Mattos, 2004;  Fuentes y Sierralta, 2004).   [1] Santiago has been named 'Gamma City' by the Gawc in 2001; Ranked 3rd in living quality in  Latin America by MHRC (2003 y 2004); and ranked 1st best city for doing business (America  Economia, 2004).
    • The Issue: A stagnation in the competitiveness performance of the country (Chile) and its capital city (Santiago): The Good YEAR UNIT RANKING SOURCE 1990 CHILE 6,000‐12,000 USD CNIC 2005 (National Council of * In 15 year has double the income per capita Innovation for  Competitiveness, Chile) Competitiveness Chile) 2001 SANTIAGO GAMMA City GaWC 2004 (Globalization and World  * Level of globalization Level of globalization Cities Research Network)) 2003 SANTIAGO 3rd MHRC 2004 Quality of living in Latin America (Mercer Human  Resources) 2004 SANTIAGO 1st America Economia City for doing business (Magazine) 2005 CHILE 27th WEF  2006 Global Competitiveness Ranking (World Economic Forum)
    • The Issue: A stagnation in the competitiveness performance of the country (Chile) and its capital city (Santiago): The Bad * Source: Banco Central de Chile GDP GROWTH RATE, CHILE 8.00 7.00 6.00 5.00 TAGE 4.00 PERCENT 3.00 2.00 1.00 0.00 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 -1.00 YEAR
    • The Issue: A stagnation in the competitiveness performance of the country (Chile) and its capital city (Santiago): The Ugly YEAR UNIT RANKING SOURCE 2004 CHILE 0,68%  0 68% CNIC (National Council of Percentage of the GDP for R+D Innovation for  Competitiveness, Chile) 2007 SANTIAGO 1st America Economia (Magazine) * Lowest levels of intellectual productivity  and innovation in Latin America   2007 CHILE Public research system scarcely linked  OECD with the market 2008 CHILE 53rd WEF  WEF (World Economic  State of Cluster’s development Forum) 2008 CHILE 51st WEF  WEF (World Economic Forum) Quality of scientific and research institutions
    • Moving towards a Knowledge‐Based Economy In the Chilean case, the promotion of knowledge‐based activities is based in the  'cluster' approach, and can be seen in the preliminary objectives of the National  Council of Innovation for Competitiveness  (Eyzaguirre, 2007).  (Eyzaguirre 2007) Based in the understanding that clustering –particularly clustering of biotechnology and ICT activities, is not related to physical comparative advantages, as one might find  with natural resource clusters, e.g. salmon aquaculture or mining, the case of high  technology enterprise concentrations in Santiago could prove the emergence of a  innovative milieu (Castells y Hall, 1994), where its competitive advantage came from  unexpected urban interactions between private agents, minimum regulations and  unexpected urban interactions between private agents minimum regulations and localization advantages.  “We understand the innovative milieu al the system of social, institutional,  organizative, economical and territorial structures that create the conditions for a  continuum generation of synergies and its investment in a process of production that  emerge from that synergic capability, as well as its units of production that are part of  this milieu as for the milieu as a whole this milieu as for the milieu as a whole”  (Castells y Hall, 1994: 363)
    • In search for a Chilean‐Model: recent initiatives In recent years, numerous initiatives intended to capitalize high‐technology  concentrations helped by the framework given in the National Innovation System  initiative.  The typology of those projects has been:   Research and Development Centers (R&D)  Research Universities  Public Research Centers  Venture Capital firms  Innovative Firms Innovative Firms  Business Incubators The ones related with the high technology sector are mainly clustered in Santiago,  and has been based in the 'Technology Park' typology, located in suburbs,  disconnected from the traditional networks of research and knowledge that the city  had developed. 
    • Table 1 – Territorial projects related with research, business and innovation Year Name Location 1991 Observatorio VLT Cerro Paranal 1995 Parque Científico y Tecnológico UCH UCH* Pudahuel, Pudahuel RM 1997 Ciudad Empresarial* Huechuraba, RM 1998 Parque de Negocios ENEA* Pudahuel, RM 2000 Ciudad de CURAUMA* Placilla, V 2006 Parque Tecnológico Ciencias para la Vida* Ñuñoa, RM 2007 Centro Científico Valdivia, IX 2008 - ongoing Parque Tecnológico U de Concepcion* Concepcion, VIII Edificio del Software GECHS Santiago, RM *Consider the Research Park typology in its master plan design Source: Blanco (2008)
    • High Technology meets Natural Resources The National Council of Innovation for the Competitiveness focused its policies in  adding value to the traditional natural resources sectors that have built the Chilean  economy, through new methods and knowledge.  A special emphasis was given to those economic activities recognized as 'cross‐ cutting' to development of the innovative capacity ‐the Information and  Communications Technologies (ICT) and Biotechnology (BIOTEC).  The main issue in implementing this strategy lays in the disconnection between those  two activities:   Natural resources activities were clustered mainly in the northern (e.g. copper in  Antofagasta) and southern (e.g. salmon and forest Puerto Montt) cities  High technology activities were clustered in the Metropolitan Area of Santiago  (MAS), due to its concentration of Higher Education Institutions (HEIs),  economical power, administrative government and urban services of high  standard  standard (Rosas et. al, 2006)
    • Clusters based in natural  Mining resources promoted in the  Chilean territory Astronomy Biotechnology Winery Forest F t Salmon Eco Tourism 1. Northern System 2. Central System 3. Metropolitan System 4. Southern System 5. Austral System Mining Wine Biotechnology Salmon Eco Tourism Astronomy Wood Astronomy Eco Tourism Energy Eco Tourism Astronomy Higher Education Sea Water Fruit Native Forest Native Forest Agroindustry Source: Ugarte et al (2007)
    • Metropolitan Central region Source: Blanco (2008)
    • Urban and regional structure of the  Metropolitan Central region Source: Blanco (2008)
    • Regional Clusters Winery Valley Transport Hub Agriculture Fruit Culture Port TI industry y Biotech industry Higher Education agglomeration Source: Blanco (2008)
    • Technology Corridor Santiago‐Valparaiso Source: Blanco (2008)
    • Innovation Capacity in the Chilean Territory Several studies detects that “the capacity of innovation of its territories is weak” (Rosas,  et al. 2006). This phenomenon, according to Brunner y Elacqua (2003) it is a  consequence of: i. A precarious common infrastructure of innovation ii.  A weak development of innovation clusters iii.  A scarce linkage between clusters and common infrastructure of innovation In the last years, it has appear a strong drive to improve the innovation capacity of the  In the last years it has appear a strong drive to improve the innovation capacity of the country, through: a) The incensement and strengthen of infrastructure for research b) The development of its most competitive industries through cluster models (Rosas, et al. 2006) (Rosas et al 2006)
    • Knowledge structure of the Metropolitan  Area of Santiago (MAS) Source: Blanco (2008)
    • Enterprise structure of the Metropolitan  Area of Santiago (MAS) Source: Blanco (2008)
    • Mechanism for innovation structure of the  Metropolitan Area of Santiago (MAS) LEYEND Tech. & Business Parks Business Incubators Intellectual and Patents Institutions A Inno. & Tech. Transfer Centers 5b Technological Consortiums Technology Nodes Time access to the New Business Center Source: Blanco (2008) 5 5‐10 10‐20 20‐30 30‐60 60‐+
    • BIOTECH and IT in Santiago: Patterns of Development  The biotechnology activities in the area around Marathon Avenue emerged  during the 1990s as a nascent sector associated with the non‐traditional natural  resource exporting industries and its proximity to Campus San Joaquin of the  Universidad Catolica de Chile, following the pattern of other biotechnology  Universidad Catolica de Chile following the pattern of other biotechnology concentrations in the world (see Farias, 2005).   The concentration of firms in the IT sector was apparent in the historical centre of  Santiago by the end of 1970s. Those early firms help the process of  modernization of the old public enterprises and its conversion into private‐owned  firms. During the 1990s the new IT firms migrate next to the new Business District  in El Golf neighborhood, were the headquarters of global enterprises were  in El Golf neighborhood were the headquarters of global enterprises were attracted in respond of the new policy of open economy of the country.  Due to the relatively recent development of these two sectors in the Chilean case,  and their specifically knowledge‐based components, there are relatively little facilities  to support its development.  In many ways, the current national innovation policy seeks to transform this trend in  In many ways the current national innovation policy seeks to transform this trend in order to create the synergies necessaries to stimulate development in key strategic  technology areas. 
    • Urban Structure TI INDUSTRY Urban Structure BIOTECH INDUSTRY Urban Structure HUMAN, INSTITUTIONAL AND FINANCIAL RESOURCES Urban Structure KNOWLEDGE GENERATION KNOWLEDGE GENERATION Urban Structure MECHANISM FOR INNOVATION Urban Structure Urban Structure METROPOLITAN AXIS
    • Leyend METROPOLITAN AXIS KNOWDLDGE GENERATION TI INDUSTRY BIOTECH INDUSTRY MECHANISM FOR INNOVATION HUMAN, INSTITUTIONAL AND FINACIAL  RESOURCES