Theory and Practice in Private and Public Sector Spatial Planning

James SimmieDownloaded by [James Simmie] at 03:09 21 May 2012that, if anything, these gaps were ‘diverging’ rather than ‘converging’ (Chatterji &Dewhurst, 1996; Dunford, 1997; Martin & Sunley, 1998; Rowthorn, 1999;Roberts, 2004; Henley, 2005; Simmie & Carpenter, 2008). In the face of suchevidence, new polices were clearly required. These sought to address the issue ofhow to accelerate the generation of knowledge and innovation in LFRs. It wasargued in this context that what they needed was a set of institutions that couldgalvanize local learning, knowledge and innovation.Starting from this policy perspective, a second policy definition of the learningregion has emerged. This is that ‘A learning region can be defined as a regional (orurban) innovation strategy in which a broad set of innovation-related actors(politicians, policy-makers, chambers of commerce, trade unions, higher educationinstitutes, public research establishments and companies) are strongly but flexiblyconnected with each other and who stick to a certain set of ‘policy principles’’(Hassink, 2001 quoting OECD, 2001, p. 24). Here, the focus is on regional andurban innovation strategies.Thus, there are two distinct definitions of the learning region. The first is atheoretical definition that focuses on the processes of regional learning and howthey may lead to regional economic renewal. The second is a policy-baseddefinition and focuses on strategies needed to generate innovation and itsunderlying learning requirements as new practical bases for the redevelopment ofregional economies. The first offers an alternative understanding to that of neoclassical,free market economics on what drives regional economies. The secondsuggests policy principles that follow from this alternative theory for thedevelopment and renewal of regional economies based on the encouragement ofendogenous innovation and learning.Critics of the Theory and Policy of the Learning RegionThe learning region both as a concept and as a policy prescription has attractedconsiderable criticism. Critics include Hudson (1999), Simmie (1999, 2003),Hassink (2001) and Cooke (2005). Hudson (1999) argues that the social andstructural constraints imposed by the capitalist system of production set the limitsof what is possible in such a system. One important feature of this system isspatially uneven economic development. This is partly based on carefully guardedeconomically valuable tacit knowledge. Hudson (1999) sees the development andthe use of new knowledge in a capitalist system as a zero sum game in which onefirm or locality’s gain is another’s loss. He argues that the prospect of generatingconvergence between different regions (or cities) on the basis of a policy focus onlearning is unlikely to succeed in the face of the forces driving uneven economicdevelopment.Hassink (2001) argues that, from a conceptual perspective, the learning regionsuffers from definitional fuzziness, its normative character, the fact that it overlapswith other TIM concepts and its uncertain position between national innovationsystems and global production networks.Cooke (2005) argues that the learning region is unlikely to last as a policyframework because of asymmetries rather than equality in local collaborationsusing different forms of economically valuable knowledge. He distinguishes6

James SimmieDownloaded by [James Simmie] at 03:09 21 May 2012institutions interact with other actors in the region. Such multiple institutions andinteractions between them have been described as ‘institutional thickness’ byAmin and Thrift (1995)This theoretical and policy focus on purely local knowledge networks andinstitutions as key features of learning regions/cities tends to ignore the possibilitythat they can lead to the negative ‘lock-in’ of outdated practices and industrialdecline. They also do not account for the importance of external knowledgenetworks to local learning.With respect to the first problem, Grabher (1993), for the heavy industries of theRuhr Area, and Maillat (1996), in the case of the Swiss mechanical watch industry,have shown that thick institutional tissues can also develop into political andeconomic lock-ins. In both cases, they aimed at preserving existing industrialstructures and had the effect of slowing down industrial restructuring andindirectly hampering the development of indigenous potential and the creation ofnew pathways of economic development.With respect to the second problem, Simmie (1999) found in a study ofinnovative firms in the South East of England that they learned as much fromnational and international networks as they did from their local regional networks.He argued (Simmie, 2003) that, far from regions relying mainly on the transfer ofknowledge and learning within locally confined networks, the more innovativeamong them formed nodes in global systems of learning, knowledge generationand innovation. In this respect what distinguished successful regions from LFRswas often not only their local networks but also the level and quality of theirinternational linkages as well.Spatial Planning and the Learning City-RegionCase Study SelectionIn this article, the role of spatial planning in the creation and maintenance oflearning city-regions is analysed from the perspective of the significance of bothlocal and international networks as the key to the development of continuallearning, adaptation, and local economic change and growth. It is argued that thenature, geographic characteristics and substance of knowledge networks are akey basis of both the theoretical concept and policy prescriptions. It is alsoargued that both the theoretical understanding and policy prescriptions will, inprinciple, be different in leading as opposed to LFRs. For this reason, some ofthe key differences between such contrasting city-regions are illustrated bycomparing and contrasting two case studies of a leading and a laggingcity-region.The two case studies are drawn from a sample frame of all British city-regions(Travel to Work Areas; TTWAs) with populations of more than 125, 000 (Simmieet al., 2008). The empirical justification for the selection is based on theassumption that innovations are a significant output from the development andcommercialization of valuable new economic knowledge and are therefore astrong indicator of the historical development of learning as opposed to nonlearningeconomies, leading as opposed to LFRs.8

Learning city regionsThe data on innovation outputs were drawn from the geographically codedresults of the Fourth Community Innovation Survey (CIS 4). This covered theperiod from 2002 to 2004. Relatively non-learning and LFRs are identified asthose with the lowest rates of innovation, and relatively learning and leading cityregionsare identified as those with the highest rates of innovation during thisperiod. Table 1 shows that the city-region of Cambridge appears three times in thetop decile of cities while Swansea appears four times in the bottom decile. The twocities are selected for analysis in this article because of these contrasting results.Downloaded by [James Simmie] at 03:09 21 May 2012Historical Development of Learning in Cambridge and SwanseaThe analysis turns first to the different historical development trajectories oflearning in the Cambridge and Swansea city-regions. Table 2 shows that the keylearning difference between the two cities has been that the successivedevelopment pathways in Swansea have needed the learning of new forms ofknowledge. There have been few opportunities to transfer tacit knowledge andlearning as the local mining pathway decayed and was eventually closed downaltogether to be replaced by the creation of a new pathway in consumer electronicsthat has, itself, also decayed and closed to be followed by a more eclectic set ofhigh-technology SMEs.In Table 2, it is also suggested that sequential waves of development in Swanseahave required discontinuous sets of relevant knowledge that prevented cumulativeknowledge transfer and learning taking place over time. Thus, firms in Swanseawere required to be more radical in the learning of entirely new forms ofknowledge than the path-dependent development of the economy would allow.This contrasts with the history of path development in Cambridge. Thesesuccessive knowledge intensive new pathways of development have been createdin electronic equipment and instruments, biotechnology, application software andlatterly clean technologies. Each of these new pathways has been created beforethe preceding one has reached its decay phase. They have also been built on acumulative knowledge base of advanced mathematics and computing for whichthe university is world renowned.The problems confronting LFRs like Swansea in breaking out of their long-termpath-dependent development trajectories using policy tools, such as the learningTABLE 1. Cambridge versus Swansea as learning and non-learning city-regionMeasure of innovation % Top decile Bottom decileFirms introducing novel products Cambridge 35% Swansea 6%Firms introducing novel processes Cambridge 10% n.a.Firms introducing new or improved products Cambridge 45% Swansea 18%Firms introducing new or improved processes n.a. Swansea 16%Firms implementing changes in marketing conceptsor strategiesn.a. Swansea 16%Source: CIS4 dataset at city level, for GB cities with a population above 125, 000 and a sample sizeof at least 75 firms in CIS4.9

James SimmieTABLE 2. Development pathways in Swansea and CambridgeDownloaded by [James Simmie] at 03:09 21 May 2012Source: Author’s ownregion are illustrated in Table 2. It is argued that their characteristic legacy of oldindustrial structures, restrictive business cultures and a limited skill base restrictsthe scope to create new economic pathways. This leads to a lack of economicmomentum for change and a consequential inability to attract a highly skilledworkforce capable of leading the development of knowledge-based learningeconomy. In turn, this limits indigenous innovative capabilities and the capacity tonetwork with and learn from external sources of knowledge. Feedback loops fromthese limitations further reinforce both the limited potential for the creation of neweconomic pathways and restrict the scope and scale of local economic growth.Spatial Planning and NetworksThe roles of private and public spatial planning in the development of both hardand soft networks as the basis of connectivity and learning economies inCambridge and Swansea are illustrated by two reports on the respective cities. Thefirst provides an analysis of Cambridge as an ‘ideopolis’ (The Work Foundation(WF), 2006). The second is the proposals contained in the update of the WelshSpatial Plan (Welsh Assembly Government (WAG), 2008) for Swansea Bay—Waterfront and Western Valleys. Both plans include the important assumption thatwhat is required is ‘leadership around a knowledge-city vision’ in Cambridge(WF, 2006, p.14) and ‘developing a cutting edge knowledge economy’ in Swansea(WAG, 2008, p. 140). In both cases, the respective planning policyrecommendations recognize the importance of learning and networks.10

Learning city regionsDownloaded by [James Simmie] at 03:09 21 May 2012There have been, however, major differences in the ways in which learningnetworks have been developed in the two city-regions. In the case of Cambridge,much of the success in creating a learning economy has been led by the privatesector. The private sector, for example, has initiated and led the ‘CambridgeNetwork’. Local entrepreneurs started the network as a private businessnetworkingorganization. It is funded by their subscriptions rather than publicfunding. This kind of privately funded networking differentiates cities likeCambridge from those where networks have only been established as a result ofpublic funding (WF, 2006, p.10).In Cambridge, a distinctive style of networking has developed. It involves acombination of private sector leadership, networking and consultancy that is ableto take advantage of the research base provided by the University (WF, 2006, p.3). The economic success of the city-region has been led by networks ofentrepreneurs, consultants and scientists working in collaboration to create the socalled‘Cambridge Phenomenon’ (Segal Quince Wicksteed, 1985, 2000). Thesenetworks have been built organically and, so far, have been proved adaptable tochange (WF, 2006, p. 14).In contrast to Cambridge, such knowledge networks as have developed inSwansea have mostly been instigated by the public sector. They have alsoinvolved a higher proportion of public sector actors than in Cambridge. Oneexample of this is the South West Wales Knowledge Economy Steering Group.Although this is a private sector led partnership, its main actors are the local higherand further education institutions, local authorities and the WAG (2008, p. 148).This reflects the fact that many of the high-technology actors in the city-region arelocated in the public sector. They include the Blue-C life science supercomputer,the Institute of Advanced Telecommunications at Swansea University andexpertise in digital media at Swansea Metropolitan University. Private sectoractors include BT and their 21CN test bed at their Swansea centre (WAG, 2008, p.147). The WAG freely admits, ‘The challenge is to further develop . . . this sector’(WAG, 2008, p. 147).These two case study examples illustrate the radically different initial conditionsconfronting spatial policy-makers concerned with enabling the development oflearning economies and knowledge networks in leading and LFRs. The formertends to start with more knowledge intensive private sector actors than the latter.These actors may also take the lead in forming collaborative networks to servenational and international markets. The relative lack of competitive private sectoractors in LFRs is one of the major causes of their poor economic performance. Insuch conditions, spatial planners are hamstrung by their lack of powers andfunding to stimulate new entrepreneurial activities and to enable collaborativenetworking between them. This raises a major question mark over the degree towhich learning region policies based on the development of relevant private sectorknowledge networks and soft infrastructure can be employed to accelerateeffectively economic growth in LFRs.As noted above, connectivity is a key driver of economic growth in cityregions(Simmie et al., 2006). Despite the contribution of the ICT revolution todigital connectivity, all the TIMs, including the learning region version, arguethat the development of trust and the exchange of tacit knowledge through11

James SimmieDownloaded by [James Simmie] at 03:09 21 May 2012networks remain highly dependent on ‘regular’ face-to-face contacts. These arefacilitated by high levels of connectivity. This type of physical connectivitybased on hard infrastructure is one of the main responsibilities of public sectorspatial planners.The importance of connectivity and hard infrastructures is recognized forCambridge by both WF (2006) and for Swansea by WAG (2008). The formerrecommends both ‘leveraging strong connectivity’ in the form of hardinfrastructures (p. 3) and the provision of ‘soft infrastructure’ (p. 3) forCambridge. With respect to its external connectivity, Cambridge again startswith advantages over Swansea. It has good road and rail links to London. Thefastest train time to London is around 45 min. International connectivity to andfrom Cambridge is also relatively good. Stansted airport, which is close by, just offthe M 11 motorway, offers good European and UK flights. Luton, Heathrow andLondon City airports are also relatively accessible from Cambridge.The internal connectivity of the Cambridge city-region, however, gives rise tosome public sector spatial planning problems. The local transport infrastructurehas found it difficult to cope with the results of economic growth. There isconsiderable congestion in and around the city and no effective public mass transitsystem (WF, 2006, p. 11). These problems have been exacerbated by the fact thathigh house prices in the central city have driven workers to seek accommodationin the surrounding towns and villages thereby adding to the volume of commutingand congestion (WF, 2006, p. 9).Some attempts to ameliorate the internal connectivity of Cambridge have beenmade. One example is the development of 8, 000 houses at Oakington togetherwith a link to central Cambridge by a controversial guided busway. But inadequatephysical infrastructure and congestion continue to impose time constraints onconnectivity and face-to-face interactions within the city-region.As in Cambridge, the relevance of public sector spatial planning policies toconnectivity are recognized early in The Wales Spatial Plan (2008). In theMinisterial forward to the plan, it is asserted that ‘The spatial planning approach inWales is a key mechanism in joining up our activities: nationally, regionally andlocally’ (p. 2). With respect to the external connectivity of Swansea and theWestern Valleys, it is argued that ‘Connectivity to Cardiff, Bristol, London andinternationally is essential to attract inward investment and for the Area to appealto a high-skilled, high-paid workforce’ (WAG, 2008, p. 146). But it is alsoadmitted that currently ‘the city region needs to improve its internationalconnectivity to attract new investment’ (WAG, 2008, p. 141).Compared with Cambridge, the external national and international connectivityof the Swansea city-region is relatively poor. London is some three hours away bytrain. Cardiff is the nearest airport but does not provide the multiple businessconnections of Stansted. Cardiff can be accessed by train from Bridgend. But thereare no direct connections by rail to Heathrow airport. In contrast with land-lockedCambridge, there are important port facilities in the Swansea city-region. Theseconnect Swansea with southern Ireland and there is also the potential for links withthe South West of England (WAG, 2008, p. 146). But these links are relativelyslow and support the tourist industry rather than the high-tech knowledgeeconomy.12

Learning city regionsDownloaded by [James Simmie] at 03:09 21 May 2012Such deficiencies in the hard infrastructures, that facilitate external connectivity,impact negatively on the development of important soft infrastructures and thedevelopment of trust and exchange of tacit knowledge through face-to-face basedknowledge networks. This confronts spatial planners seeking to develop learningnetworks in lagging regions with significant problems because learning firms gainas much key knowledge from national and international networks as they do fromtheir local regional networks (Simmie, 1999). In addition, one of the key featuresthat distinguishes leading city-regions like Cambridge from lagging areas likeSwansea is often not only their local networks but also the level and quality oftheir international linkages as well (Simmie, 2003).Despite this, the WAG (2008) spatial plan for Swansea and the Western Valleysfocuses more on intra-regional connectivity rather than external linkages. Thisfollows the focus on the first part of the overall aim of the plan which is to create‘A network of interdependent settlements with Swansea at its heart which pulltogether effectively as a city-region with a modern, competitive, knowledge-basedeconomy designed to deliver a high quality of life, a sustainable environment, avibrant waterfront’ rather than the last which is ‘excellent national andinternational connections’ (WAG, 2008, p. 139). The main reason for thisimbalance is the perceived need to spread the prosperity of local key employmenthubs throughout the city-region particularly by linking the Swansea City Centrewith its surrounding communities (WAG, 2008, p. 144). While this bias isunderstandable in the light of the lack of employment and the poverty found insome of the Western Valley communities, it is unlikely to play much of a role inaccelerating economic growth in Swansea itself.In addition to the radical differences in initial conditions found in leading andless favoured city regions, the two case studies of external and internalconnectivities also illustrate the greater difficulties confronting public sectorspatial planners in improving those conditions in the latter as opposed to theformer. First, the theoretical arguments laid out earlier in the article suggest thatinnovative firms gain as much trust and relevant new tacit knowledge from faceto-faceinteractions with national and international networked sources as they dofrom the localities in which they are based. This is facilitated by fast national andinternational connectivity. This also provides them with access to and feedbacksfrom these wider markets. The firms in leading city-regions are often good atdeveloping national and international networks and choose to locate in suchlocalities partly because of the availability of skilled labour and partly because oftheir relatively good connectivity. This is something of a ‘chicken and eggproblem’ for LFRs because in advance of the development of supplies of skilledlabour and fast external connectivity, it is difficult to attract sufficient numbers ofinnovative firms. But without the employment provided by such firms, it is alsodifficult to attract skilled labour. Overcoming such intractable problems in LFRsprovides a major challenge for the learning region as a policy prescription.Secondly, the theoretical arguments also suggest that the development of trustand the exchange of tacit knowledge are also facilitated by the proximity of actorsin knowledge-based economies. To some extent, this may be enabled by internalconnectivity. But this on its own is not sufficient to develop a learning economy inLFRs. This is particularly the case if, as in Swansea, the main aim of13

James Simmieimprovements in connectivity are to spread the benefits of already week economicgrowth from the centre towards the periphery of the city-region. Even if this isaccepted as an important aim of learning region policy, much stronger economicgrowth is required at the centre in the first instance in order to spread the benefitsaround the wider locality.Downloaded by [James Simmie] at 03:09 21 May 2012Summary and ConclusionsThe idea of the learning region emerged in the 1990s. It was based on theoreticaldevelopments in heterodox evolutionary economics, networked economies andrecognition of the importance of the co-evolution of social institutions witheconomic development that emerged during the 1980s. These theoreticaldevelopments were themselves a reaction to perceived inadequacies in orthodoxneo-classical equilibrium and market-based analyses of economic growth. Intheoretical terms, the learning region is thus an alternative way of understandingplace-based economic change and may be applied to most types of regions andcities.In policy terms, the learning region emerged in response to the effects ofglobalization and the new international division of labour combined with theremoval of traditional central state regional policies designed to support decliningindustries in situ. Successive Thatcher governments, inspired by ultra-free markettheories, set about dismantling traditional support for heavy industries andmanufacturing. This threw LFRs back on their own resources or, in some cases,support from European structural funds. As a new form of regional policy,learning regions have been concerned to develop endogenous knowledge-basedinnovation strategies. These have focused on the institutional change and thenetworked economy as ways in which LFRs can regenerate their local economies.The learning region as a policy prescription was illustrated by comparing andcontrasting the long-term economic development trajectories of the city-regions ofCambridge and Swansea. Here, it was shown that an economically successfullocality, such as Cambridge, can be characterized by cumulative learningprocesses. These can lead to the creation and development of multiple neweconomic pathways drawing, at least to some extent, on endogenously generatednew knowledge. In contrast, LFRs, such as Swansea, can suffer fromdiscontinuous learning with a succession of different development pathways eachbased on different forms of knowledge. Where this knowledge is brought in fromoutside on the basis of FDI, it may not be embedded in local learning processesand therefore not contribute a great deal to subsequent endogenous economicdevelopment. It is also the case that institutional change and networking arenecessary but not sufficient causes of change in knowledge-based economicdevelopment. The scale and scope of investment in new knowledge generatingactivities is also critical in providing the possibility for LFRs to catch up withleading economic regions.The respective roles of private and public spatial planning, in contributing to theemergence of learning economies in Cambridge and Swansea, were examined. Itwas argued that they are both potentially significant in facilitating the developmentof knowledge networks which are regarded as a key feature of learning regions.14

Learning city regionsDownloaded by [James Simmie] at 03:09 21 May 2012Nevertheless, some doubt was cast on the differences that the deployment of thelearning region concept as an intellectual underpinning of spatial planning policiescan make to the initial conditions found in different cities.With respect to the development of soft infrastructures in the form of learningnetworks, questions were raised concerning the ability of spatial planning tofacilitate such networks in the absence of sufficient innovative private sector firmsin the first instance. In the case of Cambridge where such firms had developed,there are examples where they themselves started and paid for the distinctivecollaborative networks that form the basis of successive waves of economicgrowth that has characterized the ‘Cambridge Phenomenon’. In contrast, theeconomic landscape of Swansea is marked by the paucity of such firms as oneeconomic wave after another has developed and declined. The facilitation oflearning networks in the city region is now highly dependent on the emergence, inthe first instance, of spinouts from public sector organizations, such as theUniversity and Technium incubators.With respect to the contributions of hard infrastructures to connectivity and thefacilitation of the development of learning networks, public sector spatialplanning has an important role to play. Questions were raised about the relativeimportance of external and internal connectivity. It was argued that externalconnectivity to national and international trust relationships and sources of tacitknowledge are at least as important as local proximity in the successfuldevelopment of learning knowledge networks. Here again Cambridge enjoysmajor initial advantages over Swansea with respect to external connectivities.Problems exist with respect to internal connectivity and congestion but these arenot insurmountable. In contrast, the focus on internal connectivity in the spatialplan for the Swansea city-region for purposes of spreading weak economicgrowth around the area may not do much to enable the required acceleration ofthat growth in the centre.In conclusion it is argued in this article that, on the basis of the theoreticaldiscussion and the illustrative empirical evidence, the negative path-dependenteconomic development characteristic of LFRs requires both the incentivization ofmore innovative private sector firms and the efforts of public sector spatialplanning in the deployment of learning city-region policies in efforts to catch upwith leading regions. This is because LFRs tend to lack sufficient innovativeprivate sector actors in the first instance, and partly because of their lack ofnetworks and connectivity to actors both within and outside the regions inquestion. In order to incentivize the start-up or re-location of more innovativeprivate sector firms, as the essential building blocks of more learning-basedeconomies in LFRs, it would be possible to identify, from the CommunityInnovation Survey, the regions currently with the lowest levels of innovation andto establish competitive demand side policies, specific to those particular regions,that could incentivize the development of collaborative knowledge networksbetween local actors, such as universities and government laboratories and bothlocal and non-local private sector start-ups and existing firms. Without such majorpreferential development of more private sector innovative firms in LFRs, it willprove exceptionally difficult to accelerate their economic development trajectorieson the basis of learning region concepts and policies.15

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