Dr. Vassil Kirov’ BEYOND4.0 presentation at the “Regional Development and the Factors of Success: Education, Economy and Social Policy in the Regions” conference organized by the ISSK-BAS and Konrad Adenauer Stiftung.

1. How Digital Transformations Impact Regional
Ecosystem: The Case of Sofia
Regional Development and the Factors of Success: Education, Economy and Social Policy in the Regions,
ISSK-BAS and KAS Conference, Sofia, 25 October 2019
Prof. (Associate) Dr. Vassil Kirov

2. The Main Objective
Is to find, describe and assess digitalization’s specific role in
transformation, and its impact on Sofia regional ecosystem.

3. The Research Focus
Focused on the economic impact of digital transformation on 6 regions.
It assesses how digital transformations impact regional ecosystems,
economies and societies, now and in the future. For six different
regions, the social and economic impacts are analysed, building on
possible future development paths

4. Addresses the
general priorities of
H2020 Programme
(2018-2020)
future of
business
models
Studies the
new
technologies
impact on
future of
the jobs
welfare
BEYOND4.0
project

5. The Regions/Industries Under Scrutiny…
• Selection of regions and business ecosystems by partner

6. The Research
1. Will assess the inclusive-growth related impacts of digital
transformation at ecosystem and regional level now and in the future
2. Will analyse how ecosystems and regions can respond and adapt to
future changes and to investigate how inclusive-growth regional futures
can be achieved

7. The Research
3. Will assess how the EU could help and support regions and regional
eco-systems in adapting and changing course: what are the ingredients
needed for a suitable EU strategy at regional level

8. Exploring
the Digitalization-driven Restructuring
• Digitalisation is not new as such, but what is new is its pace and scope…
(Meil and Kirov, 2017)
• Pessimistic vs Optimistic scenarios about job destruction / job creation /
job change / job replacement
(Frey & Osborne 2013 vs. Rifkin; Degryse 2016)

9. Exploring
the Digitalization-driven Restructuring
• Digitalization matters, but other factors also play a role (globalization,
ageing, climate change and so on).
• Technology is not deterministic but socially negotiated by key social
actors at various levels: firms, industry, regional, national and EU.
(Berting, 1993; Bijker et al., 2012; Child, 1972; Noble, 1984)

10. Theoretical Concepts
Two central concepts - Entrepreneurial and Business ecosystems.
The ecosystem perspective is used to analyse, interpret and explain how
digital transformation in industry/services has taken shape and what its
effects/impact have been, are and will plausibly be at regional level.
The notion of entrepreneurial ecosystem, defined as “a set of
interdependent actors and factors coordinated in such a way that they
enable productive entrepreneurship within a particular territory” (Stam
& Spigel, 2017).

11. Methodology
1. Quantitative methods.
Identification of main variables for analysis and related indicators, based
and building on Stam and Van de Ven (2018); Data retrieval: collection of
relevant data, notably the aforementioned indicators, and as much data
points over time to enable a time-series analysis by region; time series.

12. Methodology
2. Historical perspective - long-term analysis (together with UCL) – few
decades.
3. Qualitative research - interviews, company based surveys, workshops
with stakeholders (economic data, data on collaboration).

13. The Case of Sofia
• Population of 1,325,429 (2018), NUTS 3 region
• GDP (PPS) per capita - 15 181 Euro in 2018 (one of the lowest for a capital region in
the EU, but well above other cities in the country)
• Major economic transformation during the post-communist period (80% of the
GDP of Sofia is provided by services in 2018)
• Highest educational level in the country and 75% employment rate
• Rapid growth of IT and outsourcing industries over the past few years (even if IT is
path-dependent, TACTICS)
• The first Bulgarian municipality to adopt and implement Strategy for Smart
Specialization (2018), ICT being the one of its two focuses

14. The Incumbent Ecosystem - ICT
(software industry)
• Post-communist path dependence and integration in the GVC (Mako et
al. 2010).
• Best Performing Industry in BG – 600% Income Growth for 10 Years.
• 14% of Sofia’s exports have been produced by the IT sector, itself with
about 50 000 employees (2018).
• EU based and other support instruments (VC, angels, accelerators, tech
park).
• Concentration of universities.
• One of the most vibrant start-up and entrepreneurial ecosystems in
Central and Eastern Europe.

15. Some First findings…
• Digitalization (old and new) as a vector for the socially inclusive ecosystem
development (but also strong impact on globalization, EU membership).
• Long path-dependency and integration in GVC.
• Recent strategic positioning and mobilisation of EU/national support
instruments, still not sufficient to overcome policies gaps.
• Difficulty to evaluate spill-over effects (on other sectors/regions).
• An ecosystem beyond the ‘captured state’?

16. THANK YOU
For more information:
Http://beyond4-0.eu/
https://twitter.com/Beyond4_0