Arne Isaksen: Industrial development in thin regions

Industrial development in thin regions: trapped in path extension? 

Recent theorizing of path dependence supplements the traditional view of regional path-dependent industrial development characterized by lock-in effects with paths dealing with change, that is, path renewal and path creation. Few studies, however, examine why different types of regions experience diverse path-dependent development. This article examines why organizationally thin regions are much less likely to achieve path renewal and path creation than core regions. By use of a case study of industrial development in an organizationally thin and rather peripheral region in Norway the article contends that thin regions often need external investments to avoid being trapped in path extension.

Isaksen A. (2014) Industrial development in thin regions: trapped in path extension? Journal of Economic Geography, 15(3), 585-600.

Arne Isaksen

Professor of Economic Geography

Department of Working Life and Innovation, School of Business and Law, University of Agder, Norway

Hi, welcome to Coffee Break with Researchers.

Today I’m at the Regional Innovation Policies Conference in Florence and I’m having a coffee break with Arne Isaksen, he is a professor of economic geography at the University of Agder in Norway. Thank you very much for accepting this invitation to have a coffee break with me.

How are you doing?

I’m doing very well, very well.

We are both having Colombian coffee today. How do you like it?

It is very good I like it very much.

Great, happy to know it. I would like to talk with you about a paper you
wrote in which you analyze how industrial development is implemented in
thin regions, could you please tell me what the paper was about?

The paper is about how firms and industries in thin regions often have problems with doing more than path extension, so path extension is that firms have incremental innovations to do what they can even better, so thin regions have few industrial clusters, might be non- industrial clusters, few are not universities they are dominated by incremental innovations and an experience-based skills, so they have problems of doing more than doing what they do or even better.

I understand that the key notion or a key notion of your paper is path
extension, which you just defined shortly but could you please elaborate more on how you understand path extension?

A path is about that history matters, so path extension is to strengthen the already strong industries and ways of working and technologies in a region so it’s being better in what you can, which is good, but it can lead to lock in and then close your last industries in the end.

Thank you for clarifying that and could you please tell me which ones were
the main findings of your research?

The main finding is that based on both theoretical reasoning and case study or a peripheral region in Norway, that firms in thin regions have drawbacks when it comes to doing more than path extension. The case I used was a region where the Industrial Development more or less started by externally in the investment that needed to hydroelectric power stations and the in the location of two big factories, which then led to to supply us and and another and a new industrial development. So based on the fact that the firms are located in thin regions they have to build up more expertise inside the firms because they couldn’t find expertise and knowledge sources just outside their office or factory doors and they have to link up to international and national experts when doing business and innovation activity.

I am also interested in knowing what was your main motivation to do this paper?

The motivation was based on kind of frustration because much of the theorising and also empirical examples in this field of research was based on what’s happening in big core regions, which are thicker regions, where there are a lot of firms, firms in different industries, lot of research going on, so then firms can combined knowledge in much other ways than they can in thin regions so then much of the industrial development in core regions is based on knowledge already existing in these regions but I know thin regions both from my research and from the place I live, so there we have to have other explanations for industrial development. Firms as I said to build up more knowledge for industrial development. Firms as I said to build up more knowledge internally and have to build on knowledge that they can find in other places than this region. So it was frustrating because the much of the existing theories didn’t fit these cases in thin regions, and so I had to find other explanations and build up other kind of understandings.

Thank you for sharing and finally which ones would you say are
the main policy implications of your paper?

Two may be simple policy implications, the first is that policy should not only focus on the firm level it’s often just based on this kind of theories, it should also focus on the system level or build up systems, policies that can help firms in thin regions to to be more innovative and the other is to attract resources from outside the region, this is quite simple policy implications but it has to be said that firms and policy makers who think outside firms and also outside the region that they are trying to develop and drag in investments and knowledge and so on.

Great, thank you for clarifying that and those were all my questions, thank you once again for having the time to chat with me and I wish you all the best in future research and hope to see you again soon. Thank you.

Thank you for watching if you are interested in more details about this academic publication find here the link below and see you next time!

Tags: change, Development, Environmental Issues, Growth, Regional Economic Activity