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

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Figure 22: Cambridge annual employment change 1981-1991 and 1991-2005 Two-digit 1992 SICs Decline and Resurgence 36: Manufacture furniture; Manufacturing n.e.c. 90: Sewage/refuse disposal, sanitation, etc. 29: Manufacture machinery and equipment n.e.c. 73: Research and development 75: Public admin/defence; compulsory SS 45: Construction 51: Wholesale trade/commission trade, etc. 93: Other service activities 34: Manufacture motor vehicles, trailers, etc. 31: Manufacture electrical machinery/apparatus n.e.c. Ascendant 91: Activities membership organisations n.e.c. 55: Hotels and restaurants 85: Health and social work 25: Manufacture rubber and plastic goods 70: Real estate activities 52: Retail trade, except of motor vehicles 71: Renting machinery/equipment, etc. Decline 40: Electricity, gas, steam/hot water supply 18: Manufacture apparel; dressing/dyeing fur 19: Tanning/dressing of leather, etc. 32: Manufacture radio, tv/communications equipment 15: Manufacture food products and beverages 26: Manufacture other non-metallic products 21: Manufacture pulp, paper and paper products 33: Manufacture medical, precision instruments, etc. 14: Other mining and quarrying Loss of Dynamism 72: Computing and related activities 67: Act auxilliary financial intermediation 30: Manufacture office machinery and computers 74: Other business activities 92: Recreational, cultural and sporting 20: Manufacture wood/products/cork, etc. 28: Manufacture fabricated metal products, etc. 63: Supporting/auxilliary transport, etc. 65 : Financial intermediation, etc. 37: Recycling 41: Collection, purification/distrib. of water 24: Manufacture chemicals and chemical products 22: Publishing, printing, repro recorded media 80: Education 64: Post and telecommunications 27: Manufacture basic metals 66: Insurance and pension funding, etc. 35: Manufacture other transport equipment 50: Sale, maintenance/repair motor vehicles 17: Manufacture textiles 60: Land transport; transport via pipelines 1991-2005 1981-91 -20 -10 0 10 20 Percentage employment change per annum 30 40 50 Note: Excludes all sectors with < 100 employees; Excludes agriculture, etc.; Excludes forestry, etc. 44
Figure 23: Cambridge and Swansea sources of information for innovation 2002-2004 CIS4 Clients or customers Suppliers Competitors Technical standards Sources of information Professional associations Conferences etc. Publications Consultants etc. Universities Government/ public research 0 10 20 30 40 50 60 Percentage of firms rating sources as moderately or very important Swansea Cambridge Great Britain It is also clear that, during this diversification, the Cambridge high-tech economy also witnessed some relative shifts in fortune across its sectors. Even here, ‘Computing and related activities’ lost their dynamism during the 1990s. Between 1981 and 1991, employment grew by some 50 per cent, but growth slowed to 11 per cent between 1991 and 2005 (see Figure 22). By contrast, ‘Research and Development’ (which covers a range of high-tech and knowledge-intensive activities) stagnated during the 1980s but has been a leading resurgent sector since. As Figure 24 also shows, most of the city’s (relatively small) manufacturing economy has declined – or certainly lost its dynamism – since the early-1980s. Thus Cambridge, too, shows some similarities with Swansea’s development path though the fundamental composition of its economy is clearly markedly different. Some key points emerge from this contrasting of the Swansea and Cambridge economies. First, the economic history of an area can exert an important influence – for good or ill – on its subsequent development: ‘history matters’. Second, the creation of new local economic-technological development pathways reflects the interplay of local conditions and factors. Third, as Cambridge illustrates, even with a favourable mixture of local conditions and events, the development of vibrant new paths of innovative activity takes time (30-40 years in Cambridge’s case). This means that it is difficult for a city with the legacy of an old industrial past to switch quickly into new technologically advanced activities. Fourth, once critical momentum becomes established, new economic trajectories appear to become self-reinforcing and path dependent. Fifth, this path dependent development can itself spawn new technologies and activities as part of an evolutionary diversification process. Finally, growth does not, however, continue unabated without the need for renewal as indicated in Figure 4 (Part 1). 3.3 Absorptive capacity: firms need sources of new external knowledge As we have seen in Part 1, the ‘absorptive capacity’ of a city-regional economy depends on its firms’ ability to identify, assimilate and exploit new external knowledge. Data as well as information from respondents suggest that there is a significant difference between Cambridge’s and Swansea’s ability to absorb new knowledge into the local innovation system. 45
Page 1: Research report: July 2008 History
Page 4 and 5: Executive summary History matters:
Page 6 and 7: 5. Strong local social networks. By
Page 8 and 9: Acknowledgements This report was wr
Page 10 and 11: Part 1: Introduction 1.1 History ma
Page 12 and 13: Figure 2: Three perspectives on eco
Page 14 and 15: Figure 4: Two alternative path depe
Page 16 and 17: In the long-run, city-regional econ
Page 18 and 19: into new practical and commercial f
Page 20 and 21: Part 2: Path dependence and innovat
Page 22 and 23: Map 2: Introduction of novel produc
Page 24 and 25: Figure 8: Selected cities best fit
Page 26 and 27: Figure 10: Change in knowledge-inte
Page 28 and 29: Figure 12: Knowledge partners locat
Page 30 and 31: Figure 14: Change in proportions of
Page 32 and 33: Figure 15: New firm formation in se
Page 34 and 35: Figure 17: New firm formation by in
Page 36 and 37: Part 3: Cambridge and Swansea: cont
Page 38 and 39: Around the same time, the public se
Page 40 and 41: with around 10-12 firms on each of
Page 42 and 43: Figure 19: The growth of high-tech
Page 46 and 47: Figure 24: Cambridge and Swansea em
Page 48 and 49: Figure 25: Cambridge and Swansea kn
Page 50 and 51: Figure 27: The explosion of patenti
Page 52 and 53: Figure 29: Cambridge and Swansea na
Page 54 and 55: average in all forms of innovation
Page 56 and 57: Figure 32: Cambridge and Swansea na
Page 58 and 59: new technologies, products or proce
Page 60 and 61: innovation. The Cambridge cluster w
Page 62 and 63: Part 4: Why do cities differ in inn
Page 64 and 65: of the subsequent construction of s
Page 66 and 67: These two studies illustrate how qu
Page 68 and 69: 68 or technology transfer programme
Page 70 and 71: Map 4: Warrington Master Plan 1972
Page 72 and 73: Map 6: Analysis of innovation outco
Page 74 and 75: Map 8: Analysis of innovation outco
Page 76 and 77: Map 10: Analysis of innovation outc
Page 78 and 79: Map 12: Analysis of innovation outc
Page 80 and 81: Appendix 2: Secondary data indicato
Page 82 and 83: Indicators of path dependent develo
Page 84 and 85: Table 11: GVA per capita Indicator
Page 86 and 87: Table 17: Patent applications per c
Page 88 and 89: Table 22: Geography of knowledge ne
Page 90 and 91: Table 28: Occupational breakdown of
Page 92 and 93: Cohen, W. and Levinthal, D. A. (199
Page 94:
Roberts, M. (2004) The Growth Perfo
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