Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

Abstract: Continuous product and process innovations are prerequisites for sustainable competitiveness of both nations and regions. How such innovations are created and how successful innovation processes can be initiated are therefore extremely important questions. In recent years, it has been recognized that innovations are localized. They are now believed to be the result of ongoing and prolonged collaboration and interaction between firms and a variety of actors around them within what has been termed regional innovation systems. The actors in the regional innovation systems include customers, producers, subcontractors, consultants, governmental institutions, research institutes, universities, etc. Most of the research on regional innovation systems has focused on high-tech clusters in large metropolitan regions well equipped with a broad spectrum of all kinds of actors that are strategic in the innovation process. Much less interest has been devoted to regional innovation systems in small and medium-sized regions that are less diversified as regards strategic actors in the innovation process. The purpose of the current paper is to provide a critical state-of-the-art review of current research on regional innovation systems in small and medium-sized regions. In particular, we focus on what should be meant with a regional innovation system in this context and the possibilities to identify regional innovation systems that are typical for different types of industrial clusters and regions. Regional innovation policies in small and medium-sized regions are also discussed.

Keywords: cluster; innovation; innovation systems; knowledge; proximity; regional innovation systems

JEL-codes: O18; O31; R11

25 pages, November 23, 2004

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