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

Part 3: Cambridge and Swansea: contrasting path
dependent economies
3.1 A Tale of Two Cities
In this chapter we turn our focus from a multicity
statistical discussion to a more detailed
examination of two particular case-study cities
selected on the basis of their very different
experiences – Cambridge and Swansea. The
former, as our analysis of CIS data showed,
has been one of the best performing British
cities for innovative activity; indeed it regularly
ranks as one of the most innovative places
in Europe. Swansea, on the other hand, has
been one of the worst performing cities, with
a very low rate of innovation. The value of this
‘contrastive case-study’ methodology is that
it helps to reveal how locally-specific path
dependence processes and histories condition
local innovation outcomes and developments
– either positively (as in Cambridge) or
negatively (as in Swansea). As our discussion
below reveals, the two cities have followed
very different development paths over the last
three decades, producing different and selfreinforcing
innovation trajectories.
3.2 Path dependent development
The theoretical model outlined in Part 1 posits
that the main sectoral development pathways
that emerge over time within a city-region
economy collectively determine its relative
capacity (more precisely, of course, the
capacities of its firms, workers and institutions)
both to create new knowledge indigenously
and to absorb new knowledge from external
sources, and thereby to shape its propensity
to innovate. History – or place-specific
history – matters. The past development of
a local economy and its legacy condition the
scope and opportunities for new pathways
of technological and industrial development.
Cambridge and Swansea illustrate this process
in significant ways: the two cities have had
quite different economic histories (see Table
1), and their quite disparate innovative
performances over recent decades have
reflected these differences.
Swansea: the legacy of an old industrial
past
Swansea has seen three main phases in its
development. Historically, the city was heavily
dependent on extractive industries and the
production of coal, iron, copper, tin and zinc,
earning it the moniker ‘Copperopolis’ in the
19th century, when at its peak, Swansea was
producing 60 per cent of the world’s copper
requirements. However, by the 1960s and 70s,
many of these heavy industries had closed,
with the last local coal mine closing in the early
1980s.
The second phase of development was
triggered by the decline of these industries.
Attracted partly by the pool of low-skilled lowwage
labour released by deindustrialisation,
multinational companies identified South Wales
as a location for their assembly branch plants.
One of the first significant inward investments
in the electronics industry was the Sony facility
in Bridgend in 1973, east of Swansea. This
was the first major Japanese investment in
Wales, and acted as a catalyst for other inward
investors, particularly in the electronics sector.
At the height of production, 50 per cent of
televisions and 75 per cent of video cassette
recorders (VCRs) produced in Europe were
made in Wales. These markets have both now
effectively disappeared with technological
change.
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