Innovation Drivers and Regional Innovation Strategies: Territorial and Business Insights

As a consequence of the rapidly globalizing world economy, regions and countries of Europe are facing increasing competition and development challenges. The concept of innovation systems emerged along with related concepts such as clusters and industrial districts in the 1980s and 1990s to highlight the systemic interplay between firms and other economic agents in promoting or deterring innovation. The importance of knowledge for regional evolution is emphasized in different phases of the cluster life cycle literature. This literature is based on a wider economics literature on innovation that highlights a number of partially overlapping concepts and drivers. Firms are conceptualized as part of the knowledge application subsystem within the regional innovation systems. Local and international business networks emerge as the crucial means for developing positive knowledge spillovers across firms. Globalization has been accompanied by increasing urbanization, which creates a paradox: while information technology has reduced the costs of communication across distances.