In general, it is agreed that highly innovative regions in developed regions—like Silicon Valley, Route 128, North Jutland and Baden-Württemberg—have a big impact on the economic growth of their countries and generate positive externalities for the global economy. They do so through disruptive innovations that result mainly in strong and frequent interactions between key regional actors like universities, companies, research centers and governments.1
In the case of such regions in developing countries like Mexico, the experience is very different, both in terms of technological maturity and of innovation processes. It is common to see regions with a significant level of industrialization and competitiveness coexisting with other regions that showcase obvious technological lags. Also, there are structural failures in regional innovation systems, which opens a big gap—in this field—among regions of developed and developing countries. In Mexico, some regions lack organizations, companies, institutions and links that are key in creating robust innovation systems. Additionally, links between actors are weak in existing systems, which gives rise to systemic failures in the accumulation processes of technological capacities and innovation.2
It is worth evaluating the theoretical-analytical approach of regional innovation systems (RIS) when faced with this panorama. This approach has been used in Mexico for some years now to explain—mainly—the location and socio-economic impact of the high-tech industry on different regions, mainly the center-west and north of the country. The analysis has focused on the links and interactions established by actors and in science, technology and innovation policies (STI) that are implemented to drive or trigger endogenous processes (top-down strategy). Numerous studies show that this has been the way to address the issue: the analysis of the software industry in the states of Baja California and Jalisco3, the experiences of regional innovation systems in Guanajuato and Queretaro4, and the state and regional innovation agendas created by the National Council of Science and Technology (CONACYT)5 and—in terms of state and cross-border innovation experiences—by Carrillo and Contreras6.
Despite its widespread dissemination by organizations such as the Organization for Economic Cooperation and Development and the Inter-American Development Bank, the RIS approach is critical due to its application in regions of developing countries, when in fact it emerged from the longitudinal analysis of regions in developed countries, such as Japan, Germany and the United States. According to these studies, RISs developed—thanks to dynamics fostered by their own actors (bottom-up strategy)—mainly the liaison between universities and companies, and only afterwards were boosting or promotion public policies developed. Below, is a summary of the innovation systems approach at the regional level, and then some thoughts on one of the key processes in the system, namely university-company interactive links.
According to Christopher Freeman7, the first time the concept of national innovation system (NIS) was used was in a book published by Bengt-Åke Lundvall in 1992, while Lundvall8 states that Freeman himself proposed it in 1987 in his study on innovation in Japan. In any case, the innovation systems (IS) approach arises in developed economies like Japan and research teams in more advanced countries, like the Science Policy Research Unit in England and the IKE Group in Denmark. In other words, this approach was created to analyze processes in economies characterized by being highly industrialized, with strong networks of actors who cooperate and build trust, and by efficient institutions and functional structures.
The core of these systems is innovation, understood as “new combinations.” We only speak of innovation when an entrepreneur introduces an invention in the market and creates new companies, or when a company, with R&D capacity, seeks new technologies and implements them.9 For Lundvall10, innovation is a process that goes from introducing the solution in the market, to the dissemination and use of new combinations; while the Oslo manual11 establishes four types of innovation: product, process, organizational and marketing.
The key elements of the IS approach are:
Freeman13, Lundvall14 and Edquist15 agree that an innovation process is systemic: it results in complex interactions. The main interactions occur (1) between companies, (2) between companies and universities, (3) between companies and research centers, (4) those due to policies to transmit knowledge and technologies, and (5) those linked to the movement of people.
Once the regions of a country are recognized as heterogeneous, the socio-economic and economic analysis of innovation from the perspective of the RIS is more appropriate. Regarding this, Cooke16 states that key RIS elements include:
Below are brief thoughts on some of these elements, highlighting the links between university and company.
For Cooke and Morgan18, the region is smaller than the state it belongs to, and has significant supralocal power and cohesion. This power and cohesion can be of an administrative, cultural, political and economic nature. A region—then—is different than its state and other regions. Region borders are not static across time, and regionalist processes do not necessarily obey differentiating traits like history, culture and language. They are imposed—rather—by an administrative-political entity.19
In Mexico, using the RIS approach is problematic, as also stated by Contreras and Carrillo20, since relevant information is organized by federative entities, i.e. regions are defined in an administrative-political manner, instead of resulting from economically, socially, functionally and culturally linked localities and areas.
Furthermore, federal and state governments have carried out a “regionalization” with 32 state innovation agendas and three regional innovation agendas created by the National Council for Science and Technology,21 i.e. they have applied a top-down approach. These agendas aim to support states and regions in defining specialization strategies that can drive scientific, technological and innovation processes based on their economic vocations and local abilities. Even though key actors—like companies, universities and local governments—were identified to define specialization niches and lines of action, this procedure contradicts experiences seen in developed countries, where they have sought to improve “naturally” existing interactions between actors to—thus—drive radical innovation processes and help the region and country to upkeep their leadership.
Also, the top-down approach was adopted in Mexico in order to trigger interactions and links between actors that do not necessarily have the abilities, incentives or interests to cooperate. The result of these—uncertain—efforts could even be counterproductive given the allocation of technical and financial resources to actors and sectors whose innovations have low social impact and rate of return. When trying to emulate the experiences of advanced regions, the science, technology and innovation (STI) policy instruments that have been used end up being incompatible with the territory, history and culture of the regions, which translates into an alienation process. Quite the opposite of what is sought, a kind of dismantling of regions takes place, however incipient they may be.
In Mexico, state and regional innovation agendas adopted a broad definition of innovation, which not only includes creative destruction or radical innovations, but also innovations that can arise in low and medium technology sectors, stretching the concept to the point of including process, organizational, market and social innovations. Using a broad definition of innovation, instead of the limited one, like the one used in developed countries, means that innovation processes that are primarily incremental, not radical, can be seen. Radical innovation processes result from research, development and innovation (R&D&i) work carried out by companies and universities that have technological capabilities and whose interactions drive disruption.
More than plans, state and regional innovation agendas in Mexico seem to be descriptions of potential disruptive innovations of high socioeconomic impact, based on the idea that incremental innovations will eventually produce radical innovations, contrary to what the experience in developed country regions indicates.
The system concept has been particularly problematic in the analysis of RISs in Mexico. According to modern system theory, Bathelt22 points out that systems must be defined first in terms of the potential to reproduce their basic structure and the ability to actively distinguish interior from exterior. Regarding this, it has also been pointed out that national innovation systems are characterized by the ability to reproduce their basic structure and distinguishing their internal structure and the environment. However, it is not simple to define system in a similar manner for RISs given that regional production and innovation configurations rarely maintain their independent structure, especially when key institutions are identified at a supra-regional level or from centralist or national policies.
This does not deny the existence of amalgamated bottom-up RISs in Mexico. On the contrary, it acknowledges the existence of dynamics that allow the emergence, strengthening and maturing of some RISs (center-west, Bajío and northern regions of Mexico), mainly driven by the links between universities and companies. Moreover, the formulation of industrial, commercial and STI policies are experiencing significant changes in this federal administration.
Despite the disarticulation among most actors, whose interactions and links are weak, collaboration between companies and universities in RISs produce positive economic externalities, like the emergence of knowledge-intensive SMEs, with incremental innovation dynamics resulting from the detachment of big companies, mainly due to technological transfer processes. Recently, university-company interactions have produced interesting initiatives: technological and business innovation observatories, business competitiveness centers, living labs or business design and innovation laboratories, curricular maps that incorporate university-company dual training, business and engineering undergraduate degrees mainly in medium and high technology sectors, and technology transfers from multinational companies that link RISs with global knowledge networks and create conditions for the formation of business spin-offs and technological startups.
1 Philip Cooke and Kevin Morgan, “The Regional Innovation System in Baden-Württemberg,” International Journal of Technology Management, Geneve, vol. 9, issue 3-4, 1994, pp. 394-429; Anna Lee Saxenian, “Inside-Out: Regional Networks and Industrial Adaptation in Silicon Valley and Route 128,” Cityscape: A Journal of Policy Development and Research, vol. 2, issue 2, May, 1996, pp. 41-61; Martin Kenney and Urs von Burg, “Technology, Entrepreneurship and Path Dependence: Industrial Clustering in Silicon Valley and Route 128,” Industrial and Corporate Change, vol. 8, issue 1, 1998, pp. 67-103; Steven Klepper and Sally Sleeper, “Entry by Spinoffs,” Management Science, vol. 51, issue 8, 2005, pp. 1291-1306, and Michael Dahl, Christian R. Østergaard and Bent Dalum, “Emergence of Regional Clusters: The Role of Spinoffs in the Early Growth Process,” in Ron Boschma and Ron Martin (editors), The Handbook of Evolutionary Economic Geography, Cheltenham, Edward Elgar Publishing, 2010, pp. 205-221.
2 Charles Edquist, “Design of Innovation Policy through Diagnostic Analysis: Identification of Systemic Problems (or Failures),” Industrial and Corporate Change, Oxford University Press, vol. 20, issue 5, 2001, pp. 1725-53; Gabriela Dutrénit, et al., El sistema nacional de innovación mexicano: Instituciones, políticas, desempeño y desafíos, UAM/Textual, Mexico, 2010; Óscar Contreras, Jorge Carrillo and Jaime Olea, “Desprendimientos de las multinacionales: ¿Una vía para el aprendizaje y la innovación en empresas locales?,” in Jorge Carrillo, Alfredo Hualde and Daniel Villavicencio (Coord.), Dinámicas de la innovación en México: Dinámicas sectoriales, territoriales e institucionales, El Colef/Conacyt, Mexico, 2012, pp. 303-336, and Óscar Contreras and Jorge Carrillo, “Los enfoques analíticos y las políticas de innovación en el norte de México,” in Jorge Carrillo and Óscar Contreras (Coord.), Experiencias estatales y transfronterizas de innovación en México, El Colef/Comecso, Mexico, 2015, pp. 25-50.
3 Alfredo Hualde Alfaro (Coord.), Pymes y sistemas regionales de innovación: La industria del software en Baja California y Jalisco, Universidad Autónoma Metropolitana/Textual, Mexico, 2010.
4 Juan José Llisterri, Carlo Pietrobelli and Mikael Larsson (Eds.), Los sistemas regionales de innovación en América Latina, IDB, Washington, D.C., 2011.
5 Agendas estatales y regionales de innovación, National Council for Science and Technology, Mexico, 2015.
6 Óscar Contreras and Jorge Carrillo, “Los enfoques analíticos…, op. cit.
7 Christopher Freeman, Technology Policy and Economic Performance: Lessons from Japan, Pinter Publishers, London, 1987.
8 Bengt-Åke Lundvall, Innovation, Growth and Social Cohesion: The Danish Model, Cheltenham, Edward Elgar Publishing, 2002.
9 Joseph A. Schumpeter, The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle, Harvard University Press, Cambridge, 1934, and Joseph A. Schumpeter, Capitalism, Socialism and Democracy, Harper & Brothers, New York/London, 1942.
10 Bengt-Åke Lundvall, “National Innovation Systems–Analytical Concept and Development Tool,” Industry and Innovation, vol. 14, issue 1, 2007, pp. 95-119.
11 Oslo Manual: Guidelines for Collecting and Interpreting Innovation Data, Organization for Economic Cooperation and Development, 3rd ed., European Communities/OECD, Paris, 2005.
12 Bengt-Åke Lundvall, “National Innovation…, op. cit.
13 Christopher Freeman, Technology Policy…, op. cit.
14 Bengt-Åke Lundvall, “National Innovation…, op. cit.
15 Charles Edquist, 2006.
16 Philip Cooke, “Regional Innovation Systems: Competitive Regulation in the New Europe,” Geoforum, vol. 23, issue 3, 1992, pp. 365-382.
17 Philip Cooke, Mikel Gomez Uranga and Goio Etxebarria, “Regional Innovation Systems: Institutional and Organisational Dimensions,” Research Policy, vol. 26, issue 4-5, 1997, pp. 475-491; Cooke and Morgan, 1998.
18 Philip Cooke and Kevin Morgan, op. cit.
19 Philip Cooke, “Regional Innovation Systems, Clusters, and the Knowledge Economy,” Industrial and Corporate Change, vol. 10, issue 4, pp. 945-974, 2001.
20 Óscar Contreras and Jorge Carrillo, “Los enfoques analíticos..., op. cit.
21 Agendas estatales y regionales de innovación…, op. cit.
22 Harald Bathelt, “Geographies of Production: Growth Regimes in Spatial Perspective. 1. Innovation, Institutions and Social Systems,” Progress in Human Geography, vol. 27, issue 6, New York, 2003, pp. 763-778.