History Matters: Path dependence and innovation in British city ...

Figure 11: Change in proportions of employees classified to R&D and higher education in
selected cities 1981-2005
6
5
4
Percentage of
employees
in R&D or
higher
education
3
2
1
0
1981 1991
2005
Years
Reading Leeds Oxford Aldershot Cambridge
Northampton Warrington Great Britain
Newport
Swansea Wakefield Norwich Middlesbrough
Reading this declined during the 1980s and
recovered during the 1990s. At the same time
capacity in Warrington declined steadily over
the entire period although it remained just
above the British average in 2005. Newport
and Wakefield failed to register any research or
higher education employees over the 24 years.
The difference between these two city-regions
at the bottom of the ranking in 2005 with
no employees in R&D, and Cambridge at the
top with 4 per cent employees in R&D, was
considerable. They represent a major difference
between the relative capacity of these cityregional
economies to identify and assimilate
new knowledge. It is also of some concern
that only Cambridge among the top ranked
economies has a higher proportion of R&D
employees in 2005 than it had in 1981. This is
one indicator of the structural changes taking
place in the local economies.
One might expect R&D or other knowledge
assets to affect the output of local high-tech
manufacturing. But the evidence suggests
no such correlation. Where there has been a
decline in the proportion of R&D employees
this has indeed often been the case. So, cities
with significant R&D employment in 1981
that subsequently declined – as in Reading
and Warrington – saw a relative decline in
employment in their high-tech manufacturing
sectors including computers, electronic
components and scientific instruments.
(Aldershot saw a decline in computers and
electronic components). But output also fell
in Cambridge, the only city to experience
an overall relative increase in R&D and HE
employees; yet in Oxford, the resurgence of
R&D during the 1990s was marked by similar
growth or resurgence in all of its main hightech
manufacturing sectors. It is difficult to
explain from available secondary data these
differences between the two university cities.
An equally complex relationship exists between
knowledge workers and output in those cities
with consistently below average proportions
of R&D employees. In most cases this
deficit was reflected in declines in high-tech
manufacturing: this was generally the case in
27