Developing Regions - Regional Studies Association



Developing Regions - Regional Studies Association
This way!
No way!
Safe way
What way?
Yes way!
Developing Regions for
Regional Development
– Towards a new Swedish model
Editors: Fredrik Rakar & Pontus Tallberg
Developing Regions for Regional Development
– Towards a new swedish model
This way!
No way!
Safe way
What way?
Yes way!
Developing Regions for
Regional Development
– Towards a new Swedish model
Editors: Fredrik Rakar & Pontus Tallberg
Publisher: Reglab
© Contributing Authors
Editors: Fredrik Rakar and Pontus Tallberg
Graphic Design: Christer Wigerfelt
Cover Illustration: Jesper Fermgård
Printed by Linderoths, Sweden 2014
ISBN 978-91-9821-220-4
Developing Regions for Regional Development
The Logic of Regional Growth
The Mountain Package
E-health in Norrbotten
From Rivalry to Cooperation in Östergötland
Analytical work as an instrument for collaboration in Scania
Regions as gap fillers: Building a cluster commons
The role of institutions in regional development
Notes on Contributors
This book came about as a project within Reglab Sweden. As all our
activities, it is firmly based on our members’ ownership and participation, with most of the chapters written by persons connected to our
member-organizations, which now include the 21 regions (or equivalent), the Swedish Agency for Economic and Regional Growth, the
Swedish Governmental Agency for Innovation Systems (VINNOVA)
and the Swedish Association for Local Authorities and Regions.
The book is based on a Swedish version published last year
(2013), titled “Behövs regioner?”, which literarily means “Do we
need regions?”, as this was a question our members felt they had to
address given the prolonged state of constitutional transition that
Sweden seems to be trapped in. It was an opportunity for our members to analyse and reflect on their role as an actor in the regional
development system, a role that in itself still is evolving through their
day-to-day work, trying to navigate between the national and local
level of governance, and the growing demands on their organizations.
Through the process of writing and disseminating the Swedish
version of this book, our members have now moved past that question, and therefore thought that it might be interesting for a wider
audience to know a little more about what’s going on in Sweden;
how the regions are forming and institutionalizing despite the painstakingly slow constitutional reform.
Traditionally the Swedish model of governance has an hourglass
figure, with a strong national state at the top and autonomous mu7
nicipalities at the bottom. The relatively thin middle section occupied
by the counties/regions has historically only been responsible for the
health care system, but is now slowly moving on to handle issues of
regional development, which includes policy areas like skilled labour
supply, public transportation, innovations systems, culture, clusters,
and infrastructure. Some of our members have elected bodies and
taxation rights, but have never played any significant role part from
the provision of advanced health care – especially not in regional
development, which up until now has been a national matter. This,
however, is for various reasons changing fast, and much like the
population in general, the Swedish model is now growing a much
wider waistline.
Unfortunately, the much needed constitutional reform codifying
the mandate and responsibilities of regions has grinded to a halt,
leaving most of our members in a institutional void with unclear
directives, rights, mandates, powers, and very limited resources. More
than half our members are after more than 10 years of deliberation
still not regions in a constitutional sense, but rather proto-regions,
working in parallel with the county administrative board and the
county councils. Organizationally this means that some of our
members are associations of municipalities within the region, some
are divisions within the county councils, and just a few are fullyfledged regions with the official commission to work with regional
development on behalf of the national government.
But this state of transition and confusion also harbours an opportunity for the regional system to grow incrementally, developing
functional solutions, strategic alliances between regional actors, and
necessary resources bottom-up, in a white space claimed by no-one.
As the national government is hesitant to take an active regional role
and the municipalities already have difficulties owning up to their
present responsibilities, the regional level is there for the taking. The
opportunities are endless and strategic partners like universities,
SMEs, multinational corporations, regions around the world, EU
institutions, and the civil society, are abundant, and sometimes already
interconnected through globalization. So, developing a regional role
might actually be easier in an arena where the rules are not yet set,
the mandates not yet fixed, and plenty of regional resources are yet
to be discovered and unlocked through fruitful cooperation and
coordination. Without being able to force other actors to cooperate,
and with virtually no resources of their own, our members can take
on a strategic role to tend to the commons and bring others to the
negotiating table, without any other institutional interest than the
development of the whole region.
As the chapters in this book will show, our members are on the
right track to form the capacity for this meta-governance, becoming
more capable of taking the lead in creating a fertile environment for
growth and development in the regions. The first chapter, written by
the editors of the book, gives a thorough background to the creation
of Reglab and how we work with capacity building together with
our members, and in chapter 2 we get an overview of the national
logic of regional growth, how the policies of regional development
have evolved and devolved during the last decade, and how the different levels of governance can complement each other. In chapter 3
Region Dalarna, known for its beautiful landscape and vast cultural
resources, describe how they have built strategic alliances within
the region through various “packages” for regional development, a
method traditionally used as a way to compensate regions during a
structural crises, but seemingly just as effective as a tool for getting
all the right actors involved in complex processes like destination
development, and big infrastructural projects.
Chapter 4 shows how the region of Norrbotten, in the very
north of Sweden, has been forced to innovate out of necessity, turning what can be seen as a natural disadvantage (wide and scarcely
populated areas) into a resource, and a point of departure for a well
coordinated project of re-shaping the health services entirely, drawing on the unique research competence in the region to produce an
internationally acclaimed E-health programme as a regional growth
area. The delicate task of handling local rivalry within a region is
the theme of chapter 5, which shows how the dynamic energy of
such rivalry should not only be harnessed, but also harvested, and
used as a driving force for large scale regional development projects,
strengthening the regional position in relation to the national level
of governance if handled correctly as in the case of Ostsam.
One of the few actual instructions from the national government
to regional bodies responsible for growth and development policy
is that they are obliged to form a regional platform for ensuring the
regions’ skilled labour supply. This platform has no official powers
or duties, but should serve as an arena for coordinating the current
and future needs of skilled labour supply in the region with the higher
education system and other relevant national authorities. Chapter
6 shows how Region Skåne has used its analytical capacity as a
tool to bring the other regional actors to the table and participate
in the work of the platform, a soft power approach that has made
the region gain trust and confidence from the other actors, thus also
increasing its reach in other policy areas. Similar to this, chapter 7
shows how the region can be an active part in building cluster commons, facilitating regional cooperation and bridging gaps of trust and
innovation between the large industrial conglomerations and their
regional partners, with the example of Värmland in mid Sweden.
The book concludes with a chapter from the internationally
acclaimed Professor Andrés Rodríguez-Pose, explaining why institutions matter for regional development and how institutional
capacity and strategy formulation can strengthen each other. It gives
a theoretical framework for understanding why the Swedish regions
have decided to set up a permanent capacity building arena called
Reglab, through which they can share experiences (good and bad),
design joint learning projects, develop necessary analytical tools, and
navigate the white spaces of meta-governance together, in order to
avoid the shallows and tidal waves of national policy shifts. And by
writing this book, we invite you all to share these experiences as a
large international community of practise within regional development. We hope you will enjoy it.
Eva Moe
Director, Reglab
Developing Regions for Regional Development
Since the 1970’s, regional policy in Scandinavia has shifted from
handling mainly infrastructural and industrial projects towards more
fuzzy and disparate policy areas like promoting regional attraction,
functional clusters, skilled-labour supply, innovation strategies and
culture. The role of national government in regional development
is devolving, allowing more decentralised strategy- and decisionmaking by regional bodies, and therefore pushing the demands on
their organizational capacity and capability.
In order to overcome regional disparities in capacity and resources,
intra-regional laboratories for capacity building and knowledge
sharing called Reglabs have evolved. The two existing Reglabs in
Denmark and Sweden differ somewhat in organisation and focus,
in order to accommodate for the different structural contexts in
the two countries, but share common traits like a participative approach to learning, strong ownership by members and a bottom-up
perspective to regional development.
This chapter aims to show how this relatively inexpensive model
of capacity building and knowledge-sharing between regions has
been developed and adapted to the Swedish context, and how it can
facilitate policy implementation and contribute to a more inclusive
and participatory approach towards regional development, thus
both strengthening the capacity of the various regions, as well as
functioning as a redistributive measure between them.
Principles of learning
Reglab’s capacity building activities all start with the assumption that most of the experience and knowledge the group needs to
move forward is already represented in the room, and it is therefore
essential to build up a climate of trust and sharing within the group,
as both good and bad experiences are equally (if not more) important to use as examples. By sharing experiences through dialogue
and trust, Reglab can function as a community of practise, setting
aside the more theoretical approaches of how to improve regional
development, and instead focussing on the practical ways of making it work. The goal is to always have a lot of learning going on in
Reglab activities, but very little teaching.
There is no single theory, method or formula we use to ensure
effective capacity building. Instead, Reglab is built around a stringent
set of principles, all related to an idea of learning through dialogue,
sharing of experiences, participation, ownership, and that capacity is
built through a collective process of exploring and reflecting, rather
than by sending individual employees on a course to improve their
individual skill sets. It may sound very straight forward and in line
with progressive thinking around the process of peer-to-peer learning, but it is actually quite difficult to adhere to these principles,
even when everybody agrees with them.
There are many mechanisms at work when it comes to initiating, organizing and executing learning activities, which all can lead
to the pit-falls of more traditional teaching. There could be clicks
forming within the members, with the same individuals being part
of initiating and organizing activities over and over again; the secretariat could try to co-opt the design process of the learning activities
through planning; participants as well as organizers of workshops
and seminars can fall back into traditional teaching modes as we
all have been programmed into this relationship through at least 12
years of school; the national agencies can try to push their agendas
of “needed” activities to make implementation of national policies
easier; the stronger regions could push for activities that are far
beyond the level of institutional capacity in the weaker regions;
and so on. The principles of dialogue, participation and ownership
throughout the whole process are easy to agree upon in theory, but
much harder to adhere to in practise, which requires a degree of zeal
and vigilance from all actors.
But there is help from an unexpected source to stick to the participatory principles of learning – scarcity. Given that the policy area
of regional development is very broad and seems to be somewhat
changing, especially in the state of “regional mess” Sweden is stuck
in, it is near impossible for an arena of capacity building in regional
development to have all the expertise needed to respond to the needs of
its members. So far, Reglab has offered activities within such disparate
areas as monitoring & evaluation of projects and programmes, communication and public relations, cluster management, demographic
challenges, physical planning & infrastructure, culture & growth,
innovation in public sector, diversity management, procurement &
innovation, smart specialisation, social entrepreneurship, beyond
GDP, process management & leadership, digital agenda, skilled labour supply etc, each of these areas containing multiple subtopics,
research fields and required skill sets in themselves.
Accordingly, Reglab would have to be an institutional behemoth
in order to match the expertise needed in the various and growing
number of areas of learning asked for by the members. Instead, by
keeping Reglab as small as possible and with scarce resources, it
has to depend on the members to function, constantly forcing it
to involve its members, guarding the principles of ownership and
participation. The tiny and understaffed secretariat can therefore be
seen as an advantage, as it has no means to capture the process and
ownership of Reglab activities. The agenda is set by the members,
the methods used during workshops and seminars are based on
dialogue, and the content by enlarge delivered by the participants
themselves, part from the experts they chose to invite to the sessions.
As Sweden entered the European Union, it had just barely made it
out of the great economic crisis of the early 1990’s, fully comparable
with what many countries are going through today due to the 200809 crises. This relatively large structural adjustment coincided with
a string of political reforms launched by the conservative party-led
government, reforms that transformed the Swedish welfare state and
economy drastically. De-regulation and liberalization were keywords
during the brief, but transformative years under the conservative
government, and they were complemented by entering a new supranational system of agreements, markets, regulations, and funds
being made available to various actors in Sweden.
Government agencies could partner up with their equivalents in
other European countries, municipalities could find friends across
the Baltic Sea, and regions suddenly became real political actors,
with not only new funds, but also a whole new European vocabulary available to them. They could start looking across the national
borders and build alliances all over Europe, and they could also get
a direct line to Brussels, instead of taking the detour over Stockholm.
In this climate of new opportunities at the regional level, the national government decided to take a look on how to reform the 24
existing counties into a few larger European style regions, in order
to adapt to this new reality. The demands on the health care systems,
with an ageing population and ever more costly demands for advanced
specialized care in hospitals, and growing functional labour market
regions around metropolitan areas, pushed the issue of a structural
reform in Sweden. As health care and public transport are the two
main responsibilities of the counties in Sweden, the socioeconomic
as well as political development seemed to make larger regions inevitable. It’s just simple math – in order to finance a modern state of
the art health care system, you need a certain amount of tax payers
within your region, and good tax payers have good jobs in dynamic
labour markets, depending on good public transport and commuting systems. This, together with the trends of regionalization that
swept through Europe, drummed up enough parliamentary support
for trying out new EU style regions as a pilot project.
Two rather distinct and industrially important regions were chosen
as pilots during the end of the 1990’s: Skåne and Västra Götaland.
In Skåne they merged two counties and in Västra Götaland four,
making them a model for the remaining 18 counties, as both of them
had more than a million inhabitants. The initial time-frame of the
pilot was prolonged and at the end it lasted for almost 10 years, but
it was thought that other counties might see the advantages and start
negotiations of merging voluntarily during this period. At the same
time, a government commission was launched to give the administrative division of power and responsibilities between the national
and the regional level a good overhaul, as its basic structures still
were deeply rooted in the 17th century, when Sweden ruled both
sides of the Baltic Sea.
After the initial years as a member, Sweden was getting better at
accessing European structural funds during this period, which helped
change the mode and direction of regional policy in Sweden from
a more compensatory industrial policy of the 1970’s, to a growth
and innovation oriented EU style of policy. The toolbox for regional
development policy was growing, containing a whole new set of
tools like forming clusters, linking Universities and business through
innovation systems and science parks, and supporting entrepreneurship. Some of these tools had of course existed before in Sweden,
but they were now accentuated and applied in a regional context,
making room for regional authorities and other regional actors to
take on more responsibilities and letting the national government
and its agencies withdraw to a mainly financing role.
These processes jointly changed the way regional organizations
and their civil servants acted, demanding new type of competences,
capabilities, and modus operandi to deal with the emerging role of
regions in Sweden. They were not only supposed to do more of the
same, but also act in totally new policy areas, and in very different
ways than traditional administration, policy implementation, and
just handling fund applications. They could now take on a more
coordinating role, and, in order to make things happen, to identify
new areas of growth, the development of new businesses in new
sectors, to encourage co-operation between existing actors in the
traditional sectors, improving the skill sets of people already in the
workforce; to take charge in the process of creating a dynamic and
attractive region – attractive to skilled labour, investors, entrepreneurs and tourists.
Identifying a growing need for capacity building
The changing role of the regional administrations created a demand for new and broader skills, and the first ones to notice were
of course the consultants that had started to flourish around the
management of EU funds and new approaches in supporting local
and regional growth in Scandinavia through policy tools like clusters and innovation management systems. To sell the same type of
affordable analysis and advice to the various regions did not move
the regional innovation and economic growth systems forward as a
whole, and as the demand of their services grew, and many customers
seemed to need the same set of new skills and approaches, it seemed
only logical to create an arena for joint sharing and learning within
the system. By pooling their resources, the regions could also order
more comprehensive and technically advanced analyses from the
consultants, maybe even construct jointly agreed-upon rating and
benchmarking tools, for the benefit of the whole system and not
only for the stronger regions.
The first RegLab was set up in Denmark through the initiative
of Jens Nyholm, then at Inside Consulting, who is credited for
the idea of creating a new type of arena as a node for Learning,
Analysis and Benchmarking around regional development – a
REGional LABoratory for knowledge sharing, resource pooling and capacity building. At first RegLab was established as a
project formally owned by Inside Consulting, and in 2007 it was
transformed into a non-profit foundation with a much broader
scope and membership-base. Through one of the early reports on
cluster management and innovation systems using the example of
Värmland (as we have done in this anthology), the idea spread to
the Swedish market as it was facing more or less the same challenges as in Denmark.
But like many innovative ideas slightly ahead of its time it did
not materialize until years later, as the system did not seem to be
ready for such a creative solution. There already existed a slightly
similar organization in Sweden called the Dahmén Institute, which
handled issues around regional innovations systems and industrial
cluster development, financed by VINNOVA and harboured at
the University of Örebro. But with its limited scope on regional
development, it never really took off as a node for general capacity
building in the field.
Losing pace and patience
In the few following years, the regionalization process in Sweden
grinded to a halt. The government commission set up in 2003 to
give the Swedish governance structure an overhaul, had made its
recommendations already in 2007, but the government seemed to
hesitate to re-draw the regional map of Sweden, and hesitated even
more to devolve any more significant power or policy areas to the
regional level. Instead a painstaking bottom-up process ensued,
where all elected municipalities and county councils jointly tried
agree on whether, and with what other counties, they should merge,
practically asking a large number of elected individuals decide to
give up their own authority, take away their territorial and political
responsibilities, and make themselves redundant. Adding to this, the
largest party of the ruling coalition in Sweden at the time, made it
clear that it did not believe in the regional level, as it historically has
been arguing for abolishing the counties altogether, leaving only the
municipalities and the state in the Swedish model.
As the probation period for the new EU-type regions Region
Skåne and Västra Götaland Regionen came to an end after more
than 10 years, the parliament finally decided make the two enlarged
EU-type regions permanent in 2011. At the same time, any other
county or constellation of counties were now free to apply to the
national government to become this new type of region, taking over
the policy area of regional development from the national level,
besides keeping their traditional responsibilities within health care
and public transport. The first new regions to apply and be approved
were Halland (population of 300.000), and Gotland (pop 57.000),
two relatively small regions in Sweden and hardly complying with
the recommendations made in the government commission’s report.
This decision effectively torpedoed any idea of creating 6-9 EUstyle regions with a tax base of over a million inhabitants, and with
the economic activity and labour market large enough to sustain
today’s level of healthcare and services. Instead, it was a clear signal
that any county from now on could become a region without meeting
the commission’s requirements, and that the largest constitutional
reform in two centuries was being reduced to the re-branding the
county councils into regions. After all deliberations and commissions, Sweden could end up with maybe 20 regions instead of 6-9,
by just changing the denomination of its counties and transferring
the responsibility of regional development policy from the county
administrative boards (representing the national government) to the
newly formed regions.
It is in this environment of lacking political will to reform the
regions of Sweden that the idea of a RegLab in Sweden was revived.
The realities on the ground demanding a new role for regional administrations were still at play, and having gone through a decade of
institutionalisation, Region Skåne and VGR had a lot of experiences
(good and bad) to share with the prospective and newly formed
regions. The activities of the Dahmén Institute had slowly withered
away, and there was no arena for joint learning and sharing of experiences for the regions and prospective regions in Sweden. An eager
group of 10 regions and proto-regions therefore decided that it was
time to take matters in their own hands and finally form a Swedish
Reglab in 2010, as a pilot project together with the two most relevant
state agencies in the policy area (VINNOVA and Swedish Agency for
Regional Economic Growth) and the association of municipalities,
counties and regions in Sweden (SALAR).
Formative years
From the very beginning, Reglab was set up jointly by the members to have an arena of sharing and learning. Although there was
an asymmetry in power between the two state agencies and the
regional organizations that joined Reglab, it was decided right from
the start that this arena should have a strong regional ownership,
not to become yet another channel for dissemination of policies
and funds from the state to the regions. Compared with the Danish RegLab, which is open to any organisation relevant to regional
development and therefore has over 100 members, the Swedish
Reglab was designed as a more closed group, owned and run by the
regions and agencies directly involved in the implementation of the
regional growth policy, and only at the administrative side of those
organizations, not the elected politicians.
In the beginning, most of Reglabs activities were revolving in
the field of innovation systems and cluster management, as this
dominated the regional growth agenda during the 00’s. This changed
gradually, partly because the EU funds and the national policy has
shifted towards more holistic approaches to growth and development, partly because the regions themselves were answering to local
conditions and demands, and taking on a broader role than might
initially have been intended (well described in the following chapters
of this anthology).
After a initial trial period of 18 months, more regional organizations decided to join and the Reglab project was prolonged for
another 3 years, with the clear intent of becoming a permanent organization after the project period was over. As all regions/counties
of Sweden eventually had become part of the project, the structure
of the project organization was transformed to mimic a membership
association, complete with a board, annual membership assembly
and members’ representative group in 2012. During the following
year Reglab was evaluated by Ramböll Management, and as all data
showed Reglab to be a very effective capacity building programme,
the board decided to prolong the project and ask all members to
renew their initial 3 year commitment.
Organizational structure
As a membership organization, Reglab helps to coordinate the
learning, sharing and capacity building activities of the emerging
regions. It has a secretariat, a board and a members’ representative
group. The member-organizations pay a fixed annual fee according
to size of population (most pay between 15 000 – 25 000 USD)
which covers the secretariat and overheads, and then each learning
activity carries its own costs by charging a participation fee, usually
around 2 000 USD per organization, allowing them to send up to 4
individuals to each activity. With a total annual turnover of around
USD 500 000 and several hundred individuals passing through its
activities each year, Reglab can be considered an inexpensive model
for capacity building in a high-cost country like Sweden.
To run the whole operation, Reglab has a small secretariat
comprising only of one director, one programme manager and
one administrator to run the day-to-day work. The board has 9
members, representing the 2 national agencies, 1 from SALAR, 3
regional development directors from the regions (of which one is
chair), 1 from the members’ representative group, and 2 external
board-members from research and society. Its main function is to
make strategic, long term decisions, to make sure Reglab delivers
towards the goals of the organization, and to mitigate between the
members’ long term interests in Reglab, particularly between the
state and the regions.
The role of the members’ representative group is key in understanding how Reglab works. Each member organization appoints
a Reglab representative who functions both as a resource in driving
projects within Reglab jointly selecting, designing, producing and
participating in activities, but also as a contact point for Reglab to
reach the relevant participants from other parts of the regional system.
So the representative is vital in deciding, designing and (sometimes)
performing in Reglab activities, but also in “selling” the projects to
other members of staff in their region, or to staff in other relevant
partner organizations. They are the channel of communication
between Reglab and its members in a wider sense, ensuring that
Reglab offers activities that are relevant to their work, and that the
right individuals actually sign up and participate in the organized
activities. Without the right individuals participating, all learning
activities are futile, regardless of how well designed and executed.
A typical Reglab activity is initiated by members of the representative group, designed by a planning group consisting of a few
representatives from the regions and the secretariat, then executed
by the secretariat relying heavily on using member organizations’
resources in the form of expertise, partners and sometimes venues.
The core of Reglab’s activities are so-called “learning projects”, in
which the group over a period of typically 6-9 months will meet
4-6 times to explore and share knowledge within a clearly defined
area. Beside the participators, outside expertise can also be invited
by the group to complement, fill in the gaps, and assist in reflecting
on the shared experiences.
Reglab also organizes seminars and two major conferences in the
field of regional development each year: the annual Reglab conference in the spring and the Reglab Research Forum in the fall. The
annual Reglab conference is a two-day event and draws up to 300
participants, mainly from the members’ organizations. It is the major
conference within regional development in Sweden. Day 1 usually
opens with a key note speaker and followed by various arenas set
up to deepen the discussion around the conference theme using
different ways of learning, so that participants can chose the most
suitable way of learning for them. Day 2 is usually dominated by
workshops in various areas of regional development, most of them
held by the members themselves, sharing projects and experiences
with each other.
The Reglab Research Forum is a slightly smaller one-day event
with 70-100 participants, and has the objective of bridging the
gap between the members and the research community through
dialogue, using a relevant theme within regional development as a
back-drop each year. This year’s Research Forum had the theme of
Recently Reglab has also been used as a platform to develop jointly
owned analytical tools within the area of regional development, like
the regional innovation index and the skilled labour statistical indicator set; enabling all regions to benchmark in strategically important
areas like regional innovation capacity and the dynamics of functional
labour markets. Once developed, all results from learning projects
and analytical tools are made available to the public for anybody
to use, either through printed material or through the internet. Of
course, the bulk of meaningful learning and capacity building happens
through participating in the learning processes, i.e. by being there,
which is hard to capture and disseminate through written reports.
The complex institutional and operational landscape of regional
development has increased the demands on the frontline bureaucrats,
as well as on the analytical, coordinating and planning capacity
of the regions. The organizations responsible for development in
the regions are themselves developing their role, as well as in their
capacity to live up to this role. With very limited resources they are
moving from a traditional Weberian bureaucratic role of just dispersing funds and dealing with applications, into a coordinating role in
the region that can best be described as meta-governance. They are
bringing different actors within the regions together to cooperate and
offering analytical tools to benchmark their regional development
in a national and European context. Learning and capacity building is becoming more important than ever just to keep up with the
developing role of the regions in this new institutional environment.
To face this dual development process as a community of practise
makes both economic sense and opens up the possibility to tailor
capacity building activities, coming together as peers that have
encountered similar challenges across the country, and sharing
their own way of dealing with them. Pooling resources and creating networks of peers sharing knowledge and experience can be of
tremendous help in a situation where most regional organizations
are still in their formative stages, yet dealing with highly specialised
functions. Analysts, for example, can be quite alone within their own
organization, with no colleagues to discuss or reflect over technical
issues at work, no help to develop new analytical tools or learning
new analytical methods, something they can do with other analysts
in other regions through their Reglab network.
Administrative tools and practises can be jointly developed, helping
the not-so-well-off regions to the same state-of-the-art products that
otherwise only the larger metropolitan regions would have access
to, making it possible to benchmark and standardise development
analysis across the country, and having a re-distributive effect at the
same time. It also avoids the risk of each region being “trapped” by
the local supplier, whether it may be a consultancy firm with a strong
regional presence, or the local university that “usually” supplies
analysis and research within the field. Sweden is a small market and
only a handful of suppliers offer products within regional development, so by using joint procurement the regions can standardise the
products, be more in charge of what they order, and collectively save
a lot of money at the same time as they statistical analysis that are
comparable across the regions.
The Reglab model is actually quite simple and relatively inexpensive compared to more comprehensive national capacity building
programs. It reaches hundreds of individuals within the regional
development system each year, has been externally evaluated and
shown very good results (and effects), and does not require any
special expertise to set up. Based on strong ownership, participation
and alignment it actually corresponds to the OECD DAC principles
set in the Paris Agenda for international development cooperation
(2005), and with its relatively low cost structure, would probably be
very suitable for EU-enlargement capacity building programmes, and
World Bank capacity building programmes in Asia, Latin America
and Africa. Instead of flying in expensive international consultants
for a couple of days every year, the professional civil servants working and living in these countries could come together and share their
knowledge and experiences, enabling each other to devise practical
solutions for complex problems, preventing their colleagues from
making the same mistakes they have by sharing knowledge deeply
rooted in their every-day experience, and through egalitarian dialogue.
Having professionals come together and sharing knowledge does
of course in itself not replace the value of higher education and
training, but complements it as an ever on-going learning process,
firmly rooted in the every-day experiences, needs and practises of
the regional organizations. As the following chapters in this book
will show, working with regional development requires a readiness
for constant organizational learning, and setting up a community
of practise like Reglab, is an effective and efficient way of making
this happen.
The Logic of Regional Growth
Globalization leads to a heavily increased specialization of global
production. The large differences in employment costs between
countries result in tough competition between products that used
to be made in high-wage countries and are now mostly produced
in low-wage countries. Since high-wage countries have a hard time
competing when it comes to employment costs, they need to compete
with productivity, knowledge and uniqueness.
The pursuit for uniqueness causes companies to search for innovations, new products and production processes, which are difficult to
copy, especially if they are protected by patent. With an innovation
based economy, companies will turn much more to researchers at
universities and research institutes for knowledge.
However, uniqueness does not always mean that companies
need to produce more advanced technological products or systems.
Unique business models bring large advantages in competition, too.
IKEA and H&M are two examples of Swedish companies that have
built their positions on two Swedish primary industries (furniture
and clothing manufacturing). Both of them have combined Swedish
design with overseas low-wage production and worldwide logistics
to be able to promote and sell their products on a global market.
Competitive Regions
In an economy where companies specialize in unique products
and business models, sophisticated regional networks of knowledge
are created. Companies work together in clusters and cooperate with
subcontractors, consultants, universities and research institutes. The
relations are often frequent and informal, which require vicinity.
The cooperating companies and organizations demand available,
competent labour which in turn puts high demands on education,
labour market policys, public transportation etc.
Thus, the global specialization brings not only a redistribution
of the production between countries, but also the increasing importance of functional, industrial regions based on geography. Regions
in Sweden where vehicle and food dominate, or where financial
services are a field of expertise, compete with equivalent regions in
other countries.
In order to be competitive, it is becoming increasingly important
for companies in a region to cooperate through joint efforts in research
and development, successful business models, and profitable export.
Through cooperation, companies can take on challenges that each
company would have a hard time managing on its own. Together,
they can accept an order which they would have no capacity for on
their own. They can supplement each other when it comes to skills
and expertise. They can finance and carry out innovation and development projects together, and as they do, they become more attractive
as partners for universities. When cooperating, the companies have
more power to carry out export investments as they can offer tenders
with complex systems, compared to the single components which
each one of the companies can produce. Clusters may be the beginning of constellations in which companies are merged.
Universities and research institutes need to cooperate even more
with companies close by. They need to provide education and research
to large companies, but also to small and mid-sized companies to
a much greater extent. When striving for uniqueness, those companies will need the knowledge of the researchers regarding material,
production processes, etc. Universities and research institutes can no
longer be ivory towers. However, they do have problems cooperating
with small and mid-sized companies.
When companies work in clusters, the chances of cooperation
are enhanced, but in the long run, intermediaries such as industrial
research institutes and product development consultants need to
participate as the mouthpiece between business and academia.
The global specialization puts high demands on the political bodies.
Besides education, medical and health care, regional authorities are
now expected to make long and short term political decisions about
trade industrial policy, education, the labour market, infrastructure,
etc. Many of these matters used to be dealt with on national decision
making levels, but specialization becomes more and more refined,
and different regions develop different needs. Thus, decentralization
towards functional regions is necessary.
In order for a region to become more competitive, efforts in business as well as academic organizations and policys are required. These
three parts are usually called “triple helix”. Coordination between
them is necessary, especially in matters concerning long term investments for competence maintenance, infrastructure efforts or growth
projects. One way to help accomplish that has been the “Regional
Growth Programmes” and “Regional Development Programmes”,
which are produced under the supervision of regional authorities,
and/or county authorities. Unfortunately, this planning tool is more
to the concern of civil servants and politicians than to business
representatives and academics. So far, business representatives and
academics have participated less, probably because the regional
political authorities still lack funding, and that the political power
over decisions still is in the hands of national public authorities with
regional responsibilities such as the Swedish Rail Administration,
the Swedish Public Employment Service, the Swedish Transport
Administration etc.
Functional and Administrative Regions
Functional regions do not have any clear administrative borders.
Instead, borders change constantly according to what companies
and organizations happen to be included in the cluster at present.
A number of functional regions can be found in different parts of a
county. E.g., a county can maintain a wood cluster, an aluminium
cluster and an electronics cluster; each and everyone its own functional region. Other functional regions stretch across several county
borders, and sometimes across national borders (e.g. the south of
Sweden, the Copenhagen area in Denmark and the sound in between,
i.e. the Öresund region).
Functional regional clusters change over time. As big companies
become more and more international, they search for new subcontractors and consultants in the countries where they expand. The
consequence is that former partners lose their important customers.
In the region of Gnosjö in Sweden, there is a project about redirecting companies to new branches which can attract new categories
of customers. Coordinating companies with different skills, in production industry as well as the service sector, is one way of meeting
new challenges.
Considering the volatile character of a functional region, it can
never be expected to be able to make any political decisions. Such
decisions need to be made by congregations that comprise a well
defined geographical area – an administrative region. The counties
are administrative regions that were formed for other purposes than
contributing to global competitiveness. They derive from old war
and tax policys, and now serve as administrative borders for health
care policys, public transportation policys etc. County borders do
not correlate with functional regions of industry and business, or
labour market regions. Moreover, most counties are too small to
handle the necessary decentralization of decision making from a
national level to a regional level.
In many countries in the “old world”, new administrative borders for promoting regional competitiveness are being discussed;
in Sweden, 6-8 regions of about 1 million citizens each are often
mentioned. Region Skåne and Region Västra Götaland are two examples of that size. These regions used to be pilot schemes, but were
recently made permanent. The Swedish government has also given
Halland and Gotland the status of Regions, despite their relatively
small populations and in other parts of Sweden, the process has been
put on the backburner.
Whether the investigation of the governmental regional classification will spread light upon which responsibilities that will fall on
the national level, and which will fall on the administrative regional
organizations, remains to be seen. If the regionalization process is not
precipitated, there is a tangible risk that Skåne and Västra Götaland,
that are regions with their own power to collect taxes and a relatively
far-reaching delegation, will continue to distance themselves from
the weak regional compositions without such power. This process
can already be seen throughout Sweden.
All of Sweden will not live
The global competition has affected different parts of Sweden
in different ways. The regions that have been prepared by replacing
industrial production with production which is more technologically advanced and becoming more focused on service and on a
global market, are the ones that are doing best. Without a doubt,
the big universities of technology played an important part in this
development, but regional universities have served as magnets for
people and companies as well. We are also starting to see how the
universities are specializing on education and research of relevance
to the regions where they are located.
The big city regions are the ones that do best. The Gothenburg
region continues to be one of the strongest industrial regions, which
has a lot to do with an advanced specialization and a broadening
from traditional industry to industry that to a large extent includes
services. The Malmö region is about to merge with Copenhagen.
The special mandate of Region Skåne to conduct regional development policys has been crucial to this merging. It hardly would
have been possible for two regions in two different countries, had
Skåne been given a limited mandate, allowing other players, such
as municipalities, to intervene because of a right of veto. Stockholm
is about to become one of the leading service industry regions in
Europe. Stockholm holds many international companies that focus
on Scandinavia and the Baltic countries. Other parts of Sweden,
e.g. Mälardalen, Östergötland, Småland and Norrland have also
developed in a positive direction, both in population and growth.
However, large parts of Sweden are experiencing globalization as
a negative phenomenon that is mostly leading to companies closing
down, a decreasing population, and as a result, worse economy and
service. The unemployment rate is higher here, as well as the rate of
long-term disability, early retirements, and the use of labour market
policy. Regions that used to be very important to the economy and
employment rate of Sweden are stagnating now. E.g. Dalsland,
Värmland, Bergslagen and parts of Norrland are developing in a
negative direction, even if there are municipalities breaking this
pattern and doing well. Parts of Norrland (the northern most part,
making up more than half the area of Sweden) are experiencing an
economic and employment boom thanks to the global demand for
mining materials.
Not being able to attract jobs in weak regions is immensely
expensive for Sweden as a whole. The total transferral due to unemployment and long term disability in Sweden tallied up to 20
billion USD in 2004. Furthermore, regional policys, EU funds and a
realignment of taxes for weak regions costs almost another 8 billion
USD annually. In total, 6.5% of the GNP was spent on different
measures associated with groups excluded from the labour market.
These costs must be financed jointly by all regions, which means that
the costs compete with investments in growth-making activities, e.g.
education, infrastructure, research and development etc.
When more people work, and when needs for individual and
regional transferrals are low, the prerequisites for making the kind of
public investments that strengthen the competitiveness of a country
increase. Bigger and stronger regions bring the critical mass that is
necessary for making weak regions equipped to participate in the
global race, and thus, for them to contribute to the growth of the
whole country.
University cities and towns, and certain centres that are important to commercial trade, will have the best conditions to take part
in the global competition, but there is still hope for other kinds of
places, too. Suburbs of big cities are prone to become attractive for
those who work in the global competition. That goes for recreational
places, too, where city citizens can catch their breath. Even more
remote towns can establish as recreational places for a wide target
group, e.g. the mountainous regions of Jämtland and Dalarna, and
the example of the ice hotel in Jukkasjärvi, in the very north of
Sweden. When studying these regions and towns, it is evident that
their success is based on the ability of companies to cooperate and
work in clusters where hotels, ski lifts, transport etc around activities like dog sleigh riding and restaurants are organized in the name
of internationally known brands and common reservation systems.
However, there will be places that will never find the ability to
participate in the global competition. Younger generations will move
away from here to more dynamic regions, and the public as well as
the private service sector will slowly deteriorate before they go down
totally. This happened e.g. to Birka, the first city of Sweden that
existed between the 8th and 10th century. The time is gone, when
Swedish political parties followed the principle of “All of Sweden
shall live”, which often meant that promises of public service and
jobs were made for each and every farm, even in the very outback
of the country.
New goals of Swedish Regional Development Policy
Following the principle of “All of Sweden shall live”, Sweden
has conducted regional policy that can be compared to old poverty
policies. It has all been about compensatory payments to regions
that were doing badly. The new principle “Life and growth in all of
Sweden” has totally different preconditions. Now it is about creating
conditions for regions to develop by their own capacity and their
own possibilities. The new regional policy aims first and foremost
to create competitiveness in the whole country, but at the same time
include an emphasis on strengthening the regions that need more
than just market investments.
•The regional development policy must focus on raising an awareness of economic responsibility and independence rather than
instituting different kinds of financial support for regions and
• The regional development policy must focus on lasting structures
for business development. Occasional efforts on solitary projects
that are not part of an elaborate regional strategy, e.g. regional
growth programmes, should be avoided as far as possible.
• A main goal for the regional policy should be to increase the weak
regions’ ability to connect to the global economy and the export
•Another goal should be to increase the economic integration in
weak regions. The resources of business, universities and research
institutes, and the public sector should be coordinated in order to
strengthen regional competitiveness. This is done by making sure
that there is available expertise and skills that match the needs of
the companies. Furthermore, that the innovation infrastructure,
research and development, and physical infrastructure match the
needs. Small and mid-sized companies can enhance their research
and development, and increase their export through the support
of different regional programmes comprising such coordination.
The programmes should also support the companies’ integration
of modern business systems.
• The supporting and developing programmes should strive diligently
to be incorporated in modern ways of financing, which facilitate
returns of the investments and, thus, a longer lasting economic
support. Venture capital, loans against efforts, seed capital funds,
should as far as possible be connected to different kinds of rules
for write-offs and royalties.
• In the long run, the support that Sweden obtains from the EU must
be coordinated with regional development policies so that efforts
are directed towards the goal of creating 6-8 strong regions with a
bigger economic autonomy. The structural and social funds of the
EU should be coordinated so that regional development activities
for training and persons of different needs are adjusted to each
Time to put the regions in charge
By decentralizing different kinds of decision making from the
government level to a regional level, new possibilities are created to
adjust the decisions to regional prerequisites, and to use the advantage
of coordinating different political fields. Decentralizing also makes
it more interesting to business and academic institutes to participate
in the development and growth plans of the regions.
It is well known that exclusion from the labour market in weak
regions is related to a weak business climate in the region, bad public
transportation between places where people live and places where
people work or study, and the fact that people who lose their jobs
have no education. In these fields, regions should consider different interests, set goals, make priorities, allocate money, and be the
driving force. By combining an industrial and business development
policy, an infrastructure policy, and an education policy with a labour
market policy and rehabilitation measures, a region can be much
more effective than today’s uniform sector policies. Decentralization
should take place where there is a regional logic, and where synergies
can be made on that level of policy.
The Mountain Package
In the midst of an international recession, large companies are investing heavily in Dalarna, a mountainous region in Sweden bordering
to the county of Hedmark in Norway. The international giant ABB
is expanding within power transmission, Spendrups, one of Sweden’s largest brewery houses is also expanding its production and
IKEA just opened a new site in Borlänge, which will attract further
growth in the retail industry. More mines are preparing to re-open
and Boliden is investing close to 700 million USD in their Garpenberg mine. At the same time, major investments are being made in
the tourist industry, especially at our mountain destinations. Tourist
enterprises in Dalarna have forecasted that investments will be made
equivalent to several thousand new “beds” in the next few years.
Good infra-structure will be essential for transporting goods out of
the region to national and international markets, and at the same
time bringing foreign visitors in to our tourist destinations. Several
actors need to co-ordinate their efforts to ensure the breadth and
excellence of skills supply and to be sensitive to other issues needing
solutions which allow for a sustainable development and growth.
How does the regional administration answer to that? What are
the implications for infrastructure, public transport systems and skilled
labour supply? Region Dalarna, the administrative body responsible
for promoting and coordinating regional development in the county
of Dalarna, of course wants to exploit all these opportunities in order
to further regional development, and at the same time make sure it
is done in a way that is sustainable and generates employment. The
combination all of these investments demand co-ordinated efforts
and actions to be taken above the local level, but below the national
level, and sometimes, across the national level between the counties
of Dalarna in Sweden and Hedmark in Norway.
Creating the conditions for the future growth of businesses is a
challenge which has been met by the Region by establishing so-called
Packages. Region Dalarna has in practise developed a method of
administrative work, leadership and capability to make decisions
in a multi-level governance environment, where local, regional and
national actors are integrated into these packages, like the Mountain
Package and the Industrial Package. In this chapter, we will use the
development and impact of the Mountain Package, its consequences
for regional development and the dissemination of its methodology
to other areas as an example of how the regional level can meet these
challenges. It clearly shows how the public sector can be a driver for
innovation and growth by coordinating multiple levels of government and private investors to mobilize for regional development.
A large tourist industry grows further
The tourist industry is rated among expanding sectors, in Sweden
and globally. Compared to other Swedish business sectors, the export
value of the tourist industry exceeds that of the car industry and the
turnover as well employment figures are higher than for agriculture,
forestry, fishing and mining combined. From a regional perspective,
calculated on the basis of the number of guest nights per region,
Dalarna with 12 million guest nights per year is only surpassed by
the major cities of Stockholm and Gothenburg in terms of size.
Dalarna has an advantageous situation with mountains and
cultural treasures easily reachable from major cities. The strong
winter season with all forms of skiing is a stable attraction, but the
summer season also offers a host of sporting and cultural activities. Many celebrate Midsummer around the great lake of Siljan.
There is a long history of tourism in Dalarna; indeed, the first time
the word ”tourist” was used in Sweden is claimed to be in a 19th
century drawing depicting visitors to the Falun coppar mine in the
region. The arrival of the railway also added to the flow of tourists,
soon transporting royalty, artists and celebrities to guest houses and
hotels in Tällberg and Rättvik.
Tourism has grown into a significant industry offering a range of
experiences to Swedish and international visitors such as Dalhalla,
Santaworld, Sommarland and Orsa Bear Park. Cultural and creative
businesses develop new products based on hiking, handcrafts and
sports. The tourism industry has generally found it difficult to assert
its importance in relation to other sectors. It is mainly composed of
a number of small enterprises that, together, provide visitors with
an experience including food, accommodation and travel – but not
as one single entity. One could say that the “tourism factory” is less
visible than other factories, and has a multitude of owners, but no
“captains of industry”. Region Dalarna’s development programme
has pinpointed tourism as a prioritized sector – an area of strength
just as important to the region as steel and manufacturing.
When Region Dalarna conducted a Regional systems analysis
in 2008, it was noted that enterprises in the Dalarna Mountains
were planning an expansion totalling 27,000 new beds during the
coming 10–15 years. This was a significant addition to the 75,000
beds already existing in the area, and would turn Dalarna into the
largest winter destination in Northern Europe. The scale of expansion implied the establishment of a number of new facilities and
work places, as well as the development of new line of products for
future guests. Thanks to the recognition of the tourist industry as a
significant sector, attention is also given to important pre-requisites
for growth in the industry. The Mountain Package discussed below
is an example of how local, regional and national stakeholders can
mobilise on the basis of the needs of the tourism industry.
Composing a well “packaged” solution
The establishment of any new factory or production unit sets of
a number of other necessary processes in the vicinity of the site, and
this also applied to a tourist destination, supporting expansion of
a number of small businesses stretching across four municipalities,
two in Sweden, two in Norway. A signal that something needed to
be done was registered during work on the present regional transport plan for Dalarna. The groundwork was done there, aiming for
a regional transport infra-structure that could handle the growing
export industries – the export of produced goods and travel for tourists to the area. Stocktaking of planned investments by businesses in
the mountain areas was an eye-opener. Expansion of the number of
beds leads to more restaurants, ski-lifts and other activities, more
investment in construction and in turn even more jobs. Investment in
the tourist industry provides more jobs, since increased production
implies more visitors being taken care of by more employees and/
or entrepreneurs, so the Region actively supports the Destination
Dalarna Cluster. But the present transport infrastructure was already
strained, raising questions on how increased tourist travel can be
managed in a sustainable manner. It was the basis for an approach
where public sector players at a local, regional and national level as
far as possible should facilitate for businesses to realize their plans.
Apart from increased traffic to and from the mountain destinations, it was also soon clear that a number of construction plans
were under way, requiring a support structure for their realisation.
Preliminary discussions with the business community pinpointed
three areas that needed particular attention. First of all, how transport infra-structure could handle increased traffic to and from the
mountain areas, and what solutions were conceivable for transport
other than by car. Secondly, the issue of skills supply – the increased
number of beds meant the recruitment of new staff. New facilities
and activities during most of the year imply a need to attract new
staff and new entrepreneurs. Thirdly, there was a discussion on how
to solve the provision of local infra-structure such as accommodation, schools, child care, supply of electricity and other utilities. The
four municipalities will be transformed into a year-round destination
for Nordic and international visitors. This transformation affects
issues on a local, regional and national level, but also individuals
and businesses.
Early on, a fourth area was discussed: institutional regulations
in areas such as environmental conservation, planning and licensing
laws. Originally, representatives for these areas were to participate
as consultants during the process to legitimize later rulings, but in
the finalized plan for the Mountain Package it was felt that it would
be too difficult to know in advance which authorities would be
involved, so they were invited as ad hoc experts instead.
The formation of the Mountain Package was inspired by how
traditional crisis management packages are constructed in cases when
large industrial site is closed down and a whole region is affected by
high unemployment rates and loss of investments. These compensatory crisis packages were translated into a development package
instead, gathering the public sector actors who ”own” the solutions
that can contribute to providing the right pre-requisites for further
expansion. Stakeholders were gathered in a coordinated effort where
each partner contributes their expertise and shares experiences of
value for the others. It was important to establish a working method
where discussion and priorities were created jointly with the tourism
industry in the mountains of Dalarna. In the Mountain Package,
business representatives serve on the coordinating committee, but
they are also the target group for the practical developments achieved
in the Destination Dalarna cluster.
Region Dalarna as coordinating regional player
Region Dalarna is a municipal association founded in 2003 by all
the municipalities and the County Council of Dalarna. Its mandate
was to take responsibility for the coordination and streamlining of
regional development issues, comprising business development and
intelligence, project funding, infrastructure and European cohesion
funds, as well as tourism and public transport. Formal responsibility
for regional development is delegated by Parliament and the government has appointed Region Dalarna in this role. Region Dalarna,
like similar regional associations in Sweden, has been forced to
grow into its role of regional leadership fast, from a beginner into
an established and recognized player in less than a decade. Leif Nilsson, chairperson of Region Dalarna, underlines this in a newspaper
article, stating:
Region Dalarna’s mandate is described by the national government
but also by our members, municipalities and the county council.
Our national mandate is augmented by our right to take political initiatives and act on those issues we consider to be important
without asking for governmental or other permission first. With this
strength we are prepared to take on such responsibility, just as we
take responsibility for regional leadership in Dalarna.
Region Dalarna’s mission is that it should play an active role in
Dalarna’s development, coordinate and streamline work on regional
development, and be a forum for creative and progressive discussion
and developmental initiative. Any approach and method should
be implemented to make an immediate difference. The Mountain
Package is an example of the way the political leadership and staff
of Region Dalarna initiate and pursue cooperative working methods. The deeply embedded cooperative nature of Region Dalarna’s
approach comes from the fact that the regional leadership role was
assigned to the organization by other public sector players in the
region: the Municipalities, the County Council, the University, the
County Administrative Board, and others.
Göran Carlsson, regional director, says: “The pre-requisites in
Dalarna may not be at fault when companies are making decisions
based on commercial assessments.” In other words, packages are an
expression of regional leadership, taking initiatives and coordinating
public stakeholders, the keyword in this approach being that Region
Dalarna is a provider of pre-requisites for growth and development,
enabling other actors in the region to fulfil their visions and plans
for growth.
How was the Mountain Package organized?
Mountain Package Dalarna is not a traditional project in terms
of financing or personnel. In the Mountain Package three separate
processes are intertwined and organized in “blocks” to prepare the
destination area for the expansion at hand. One block handles planning issues from a regional perspective. This includes local transport
infra-structure for visitors and goods, as wells as the supply of utilities to buildings and facilities. Another block develops conditions
for tourism enterprises using a regional cluster model developed
by the traditional manufacturing industry. This supports learning
processes for small businesses aimed at refining products, improving
distribution channels and intensifying national and international
marketing and sales efforts. The third block handles accessibility
issues to and from the destination and involves national actors on
both side of the border.
Each project block is set up according to a specific theme, with
a common goal to create conditions for expansion in the mountain
areas. Projects are funded by the EU Interreg programme or Structural fund, and co-financed by project funds from Region Dalarna.
The coordinating committee is informed of the development of the
various projects and problems are continuously discussed, leading
to guidelines being given by the committee to the projects. It is not
easy to discern whether results of the Mountain Package can be attributed to input and decisions, to inspiration for new processes, or
to the working method itself. Each project is reported in the usual
way, but several significant results have been achieved alongside or
between projects.
The three blocks with local, regional and national stakeholders are
coordinated by a group under the administration of Region Dalarna
(see figure below). Region Dalarna was responsible for setting up the
projects and for the cohesion of the Mountain Package. The public
sector stakeholders were gathered in a coordinating committee, with
participation from the three municipalities directly concerned (Mora,
Älvdalen and Malung-Sälen), Region Dalarna, the Dalarna County
Administrative Board and the Swedish Agency for Economic and
Regional Growth. It is vital that the coordinating committee can
take executive decisions during their discussions and decide priorities
together with business representatives. Göran Carlsson emphasizes:
“We had our opinion on which individuals should participate. We
let municipalities know that they could appoint whomever they
wanted as long as s/he is chairman of the municipal council, and we
said the same to the County Administrative Board, as long as s/he is
County Governor”. The committee also comprises as chairperson
(the chairperson of Region Dalarna), the director of the central region
of the Swedish Transport Administration and the national manager
for tourism at the Agency for Economic and Regional Growth. The
business community of Sälen was represented by the CEO of Skistar,
and the CEO of Idre Fjäll was selected to represent Idre businesses.
Project block: Local and municipal context
Sälen, Idre, Trysil and Engerdal are the four municipalities on the
Swedish and Norwegian sides of the border that aim to be a cohesive
international tourist region. The future destination comprises winter
sports facilities among the largest in northern Europe. There are approx. 100,000 beds for visitors and annual tourism turnover in the
area amounts to more than 3.5 billion SEK, offering approx. 3,000
job opportunities. Tourist businesses plan significant expansion;
apart from new accommodation, there is heavy investment in skiing
facilities and other attractions and a desire to develop the area into
a year-round destination. Securing this development and the plans
for business expansion requires cross-border cooperation between
the four municipalities, and places demands on other regional and
national stakeholders.
Skills Supply
Skills supply is a challenge for the business community: recruitment opportunities but also developing the competence of employed
staff. Ambitions to develop into an international winter destination
require a professional reception for international guests and an attractive product mix for new groups of costumers. International
visitors often expect a higher quality of service, a good reception
and some background knowledge of various cultures. English is of
course obligatory, but language skills for guests from Eastern Europe
and the Baltic states will also become important. The project aims
to improve knowledge of new markets, trends, communication and
product sales to various groups. Hosting skills among municipal
representatives and the local general public will also be targeted.
One problem is that the destination is in an area of depopulation,
implying that skills need to be recruited from other parts of Sweden
and Norway in fierce competition with other regions and business
New methods will be tested to train existing staff and to attract
new groups to the service industry by offering higher education
schemes close to the skiing facilities. Bridging courses for university
entrance and ”start your own business” programmes will strengthen
opportunities to establish the new businesses and services needed as
the destination expands. An old tea-room on a ski-slope now hosts
Campus Sälen with distance studies at university offered for the local
population and seasonal employees, thanks to modern technology
and distance learning facilities offered by Dalarna University. Further
down the slope is staff accommodation which serves as student flats,
and student union activities are easily arranged with discounts at
local restaurants.
Dalarna University has been a positive force in offering tourism
programmes in this novel form and provides a good example of
how the tourism sector can secure a skills supply whilst employees
have the opportunity to enhance their competence with academic
studies. Educating young people for direct entry into employment
in the tourism sector is another form of skills supply, offered by
upper secondary schools in the region cooperating with business
in a “Tourism College”. A model is also being tested for offering
seasonal employment in hotels and restaurants to migrant workers,
with a basic training financed by the Employment Service followed
by more specific vocational training offered by the Tourist College.
Public services and technical infrastructure
Public service provision differs between Swedish and Norwegian
municipalities, implying an intrinsic challenge to overcome differences and obstacles in order to create a satisfactory level of provision
for the entire region. Traffic in the region is due to expand, with
increased coordination required between police, fire and ambulance
services. There will be growing demands on the health care system
from those staying in cabins and hotels. Overall, there are a number
of pressing public service issues for employees, visitors and the local population which also involve the regional and national levels.
One example is the current discussion between police authorities in
Hedmark and Dalarna in preparation for a large number of overseas
visitors, if and when the projected airport is built.
One of the biggest challenges in this project is to examine whether
there is a basis on which to establish an airport with direct connections
to the European market. The Sälen-Trysil Airport which is envisaged
will require adjoining roads and available transport for those arriving
by air: taxis, car hire and public transport. It is also important to
examine the consequences of expanding accommodation supply for
the local communities within the destination. At present the major
hotel facilities and cabin villages are close to the ski slopes, with a
large number of private cabins scattered across the mountain region.
In addition to hotels and cabins, a number of commercial arenas and
service facilities will be built – in practice entire new communities
within the destination, requiring coordinated planning. Some of the
major challenges for the physical planning process are:
• Development of an effective, safe and environmentally friendly
transport system for the destination.
• Improvement of local transport and other services within the destination in order to facilitate arrivals by public transport.
• Finding solutions for water supply and drainage for buildings,
taking into consideration the protection of the sensitive surrounding environment.
The four municipalities have reached consensus on local planning
issues in a common review document. Efforts have been applied
to create a broad dialogue with citizens and businesses. Realising the ambition of a sustainable destination is as dependent on a
well-grounded democratic dialogue as on protection of the natural
Added value in the border region
Action at a local level of the Mountain Package involves four
municipalities on either side of the national border. Cooperation is
strategic and practical, utilising each other’s capabilities to build
relationships and networks between people hitherto separated by
administrative and psychological barriers. When the relevant players
work together, concrete planning problems become obvious, and the
common ground established for strategic priorities facilitates the
making of operative decisions. Those in charge of policy (including
for the business sector) for each municipality, and for the regional
players Hedmarks Fylkeskommun and Region Dalarna, are all represented in the coordinating committee for the project. Stakeholders in
the project thus have a mandate to make operative decisions on the
spot. Ingemar Kylberg, project manager for the local and municipal
context, says that producing a common factual base is one of the
most important tools for success in a coordinated working method
for making quick decisions. It is vital to make visible what needs to
be done and to take action accordingly. The factual base in this case
comprises a systematic analysis of the entire destination, describing
the importance of a cross-regional development towards a common
Swedish-Norwegian tourist destination with an attractive yearround range of products. The single most important venture is the
construction of a new airport and the corresponding road network.
Project block: Regional context
Clusters are a tool for regional development in Dalarna, and
Destination Dalarna is one of these cluster initiatives, supporting
businesses in the tourism sector in the Mountain Package. Involvement
in the Mountain Package is consistent with the vision of Destination
Dalarna: Dalarna is the leading tourist destination in northern Europe, and the most exciting. The cluster works within the Mountain
Package towards increased sales to international customers, product
development and planning, skills supply and increased maturity for
the export market.
Attracting international visitors
As a major destination, Dalarna has at present a low proportion of international guests. Establishment of the new year-round
mountain area destination will be dependent on attracting far more
guests from foreign markets. Part of this effort involves improving
international business contacts and preparing businesses for growing export. It also requires better market communication from the
destination towards new markets. A sales and booking platform,
45 , is already in place and available for businesses to join in the presentation of the collection of attractions on
offer in Dalarna. Destination Dalarna has also joined forces with
the national player, Visit Sweden. This partnership is appropriate
to the export of touristic products and services for the year-round
mountain area destination which is envisaged. Visit Sweden employs
a proven method to determine if and when a destination is mature
for the international market, including the requirement that products
offered have an international flavour and can make an impact in
the global competition for tourists’ attention. By cooperating with
Visit Sweden, Dalarna has access to long-term partnerships to attract
more foreign visitors and to develop the destination. A destination
that is mature enough for export involves not only the tourism businesses in the area, but also indirectly other players in a long-term
strategic effort. In the Mountain Package, Visit Sweden’s model
will be implemented in businesses in the mountains of Dalarna, and
will also involve other players through Destination Dalarna. Some
examples of activities: skills development in international sales, PR
and communication, campaigning, understanding export maturity,
analysis of new markets.
Common ground for product development
Attracting more visitors means offering interesting products for
tourists, from Sweden and from other countries. Destination Dalarna
is developing methods to create new products and to work in a more
innovative manner. Products in the tourism industry nearly always
consist of services that are produced at the moment of consumption.
It is vital to develop products that are quality assured, packaged and
priced to meet (or preferably to surpass) customers’ expectations. Business models need to be developed to re-invest value in the company.
Destination Dalarna has presented a process based on reciprocal learning by observing how others have acted, after which new products
suited to the specific conditions in Dalarna can be created. A study
trip to Scotland by a number of businesses resulted in new products
for biking enthusiasts in several destinations in Dalarna, “Biking
in the mountains” being one of these. Several products are being
similarly developed and quality assured, suited to Dalarna’s natural
and cultural context. This method has been successful for product
development, but also for mutual learning and cooperation between
entrepreneurs. Lotta Magnusson, process leader for the Destination
Dalarna cluster, emphasizes the learning process and specifically
sees significant potential in Dalarna for biking products. She points
out that being active and biking on holiday is a major global trend.
Dalarna has brilliant biking conditions and facilities in mountain
areas are enthusiastic about a strong product for the green season.
Project block: National context
The road network infrastructure is, in general terms, scaled for
normal traffic flows, and does not take into account the increase
in traffic for leisure trips. During the winter season, especially on
Thursdays and Sundays when rental cabins switch guests, the pressure of traffic increases radically, causing long queues. Most visitors
to the mountain regions come by car, usually for a week, and with
arrivals and departures on the same weekday. On those days, traffic to and from the mountain areas can add 50-60,000 travellers to
normal flows, affecting traffic far down south on both the Swedish
and Norwegian side of the border. With facilities now aiming at
year-round activities, traffic will peak on many more occasions during the year. A major issue is therefore the formation of sustainable
transport provision, since neither existing roads nor railways can
handle increased strain.
At present there is no comprehensive picture of how traffic to
and from tourist facilities can be organised with regard to economic,
social and ecological sustainability. Solutions for tourist traffic to the
major year-round destinations envisaged in Sälen, Idre and Grövelsjön
need to be examined from a holistic perspective with the traveller in
focus. These efforts require the involvement of several players apart
from the tourism and service sectors, specifically municipalities,
regions and the Swedish Transport Administration. Common goals
must be established as well as consensus on ways to reach them.
Within the national block, a developmental project will attempt
to design a holistic plan for sustainable transport provision to the
mountains of Dalarna. One aim is to combine existing projects in
the region for the provision of tourism transport and to integrate
them in the task of the Transport Administration to ensure socioeconomically efficient transport provision. The Swedish Transport
Administration obviously has a role in this, as well as Region
Dalarna with its responsibility for regional transport plans and
public transport. There will be a continuous dialogue and close connection with the implementation of long-term national and regional
transport plans. The advantages of cooperation are the driving force
to participate in this process, even if the various stakeholders have
differing motives and perspectives. The Transport Administration
is expected to participate from the point of view of establishing a
socio-economically efficient and sustainable nationwide transport
supply system. Businesses should be motivated by their need to offer added value to guests, thus improving viability conditions. One
result of the Mountain Package is the regional transport programme
for Dalarna, often regarded as a model for considering the needs of
the tourism sector in transport infra-structure. Region Dalarna and
the Swedish Transport Administration continue their cooperation
towards a special programme for transport provision to the mountains of Dalarna, based on the plans for a year-round destination.
Other concrete results are improvements of the roads to the
mountain areas and the new route E16 which was inaugurated in
the autumn of 2012. Three bottlenecks have also been pinpointed in
the national and regional transport plans. The hub of the problem
for all parties in the Mountain Package is to find sustainable solutions to increase accessibility for foreign travellers. One alternative
is to establish an airport in Sälen providing service to the mountain
region both in Sweden and Norway. Another alternative under investigation is a development of the airport in Mora, with new transfer
solutions to other transport in the region. Either way, Mora will be
an important node for various transport alternatives.
Sälen-Trysil-Idre Airport
In a regional analysis of the SITE-region (Sälen, Idre, Trysil and
Engerdal) there is a special examination of a planned airport in
Sälen. The report concludes that the expansion, functionality and
increased attractiveness of the area cannot be achieved without a
common airport for regular services and seasonal charter services.
Regular traffic is envisaged to and from Oslo and Stockholm with
planes carrying 30-70 passengers and calculations show that annual
usage could grow to 60,000 passengers within five years. Seasonal
services could run from December –April from various regions in
Sweden and Norway, such as Gothenburg, Malmö, Helsingborg/
Ängelholm, Växjö, Kalmar, Bergen, Stavanger etc. Several potential
markets around the Baltic also fit the bill: Helsinki, Åbo, St Petersburg, Copenhagen and the Baltic States. Germany is an important
market since there is considerable interest for the region there. Great
Britain and the Netherlands also show interesting potential. It is
for these markets that new tourist products are developed and promoted by Destination Dalarna. Sälen is the only place in the region
which meets demands on aviation safety, noise levels and emission
standards. Environmental assessment is under way. Accessibility
is a central issue for the coordinating committee of the Mountain
Package, who are actively trying to facilitate the establishment of
sustainable transport solutions. Cross-border involvement is at
the heart of the Mountain Package, finding common solutions to
problems and issues that appear. The separate projects are free to
initiate action and are expected to comment on the entirety and on
work in the other project blocks. They are encouraged to break new
ground, exchange experiences and contacts – the overt work and
quick decision processes can make all the difference.
What concrete results can be shown from the Mountain Package?
As described above, the Mountain Package has introduced a way
of working that mobilizes public sector stakeholders by gathering
decision-makers and creating favourable conditions for future investments and business establishment. It is also an example of how
regional leadership can be exercised by collecting and forming available resources. For the purposes of practical implementation, three
projects have been created, financed by different programmes. The
projects comprise a variety of local, regional and national players,
cooperating on relevant issues. The Mountain Package is thus also an
example of a multi-level steering process, with cooperation initiated
and coordinated by a regional player, in this case Region Dalarna.
Some of the concrete results of the Mountain Package have been
exemplified in the descriptions of the three project blocks above,
but the major result can rather be said to be the establishment of a
successful working method. This method has recently been transferred to the so-called ”Industry Package”. Huge investments are
taking place in Ludvika municipality, involving the development of
ABB and the concentration of Spendrups’ activities to Grängesberg.
These changes result in investments amounting to approx. 1 billion
SEK, and with plans to re-open three iron mines and investments
at Säfsen Resort, we are looking at 1,000 to 3,000 new jobs in a
single municipality. The Swedish Agency for Economic and Regional
Growth is also involved in this Package, wanting to follow the project from the initial discussions and throughout the project to final
results and evaluation.
The efforts of the Mountain Package were directed towards the
needs of the tourism sector, whereas the requirements of the Industry
Package derive from plans for expansion in specialized high-voltage
technology, beverage production, mining and tourism – sectors with
hugely varying demands on requisite measures. This means that
the Industry Package has to handle a patchwork of requirements,
all to be resolved mainly within one municipality. The Industry
Package has its own skills supply discussion – how to access special
resources for training and labour market measures to satisfy local
skills demands when growth is very fast and geographically closely
defined? This issue is a special challenge involving several ministries
and authorities with different goals and priorities. Other effects of
the package are that players at different levels perceive a common
picture of what needs to be done and which of them can see to getting things done. This has contributed to Region Dalarna practising
their regional leadership to a greater extent. Their responsibility for
regional development has thus been strengthened by others seeing
that they take on and use this responsibility.
Lessons learned from the Packages
The Mountain Package and Industry Package are examples of
measures that mobilise local, regional and national players regarding concrete challenges in planning. It is a vertical powerhouse
based on the fact that local resources are insufficient and need to
be complemented by regional and national measures. In contrast to
crisis packages, these packages aim to solve issues that could prevent
potential growth and expansion, mobilizing for positive development
rather than dampening the negative consequences of a turndown.
One difficulty in constructing this kind of package is that it is
impossible to predict which activities will be needed. Instead, scope
must be created for a process although the players cannot be fully
pre-defined. It has been difficult and time-consuming to apply for
funding for a process, rather than for a traditional project as expected
by financiers. Processes that are based on cooperation between various
public stakeholders and businesses need more transparent support
with continuous opportunities for adaptation, rather than the detailed
and priced measures of a project plan. Each package has its own
logic and requires individual planning, and it is vital to regard this
as a process rather than a project. It must also be stressed that it is
an issue of cooperation between public stakeholders and between
the public and private sectors. Even if packages have a project-like
framework, it is difficult to pinpoint all planned activities whilst still
allowing leeway for unforeseen action. On the other hand, project
logic is useful in terms of setting goals to strive towards.
Some important lessons are:
• National players must have a mandate to cooperate at local and
regional levels in order to apply appropriate measures for creating
the prerequisites for strong local growth within a limited area and
time-frame. If such measures are not forthcoming, we estimate
that opportunities for development and growth will be missed.
• Forms need to be developed for the support of process-focused
working methods, often differing from those for projects.
• Joint efforts must be well established in the management team of
each stakeholder, preferably by active participation at the executive level, in order to ensure an executive mandate for members
of the committee so that they are not required to “check back”
on every issue.
The role of regional leadership is to link together those institutions
at a national level that are involved in the challenge at stake. It is
important to note that results of measures taken towards development can only be observed at the local level. The regional level can
create the right conditions for solving issues that concern a wider
audience than the local or municipal level. Challenges presented
within the packages are not limited by administrative boundaries.
Regional leadership must be sensitive to local issues and create appropriate conditions in cooperation with the other players involved.
Region Dalarna thus has the role of a provider of pre-requisites. In
Göran Carlssons words:
Whether or not the packages have been useful can be determined
only if and when we see that our efforts actually contribute the
necessary measures to provide pre-requisites – measures foreseen
in advance and those that become obvious during the process. Our
primary goal is that the packages contribute to the realisation of
planned investment and expansion. If this is not the case, it must
not be on the account of the public sector having failed to provide
the adequate pre-requisites.
E-health in Norrbotten
In this chapter we will describe how Norrbotten County has worked
with establishing e-health – or the development of the health care of
the future - as a growth area. The area has developed organically,
without a particular strategy for e-health. There have, however, been
programmes and strategies to support the development indirectly.
Enough visionary parties in various posts and different organisations – businesses, academia, and politics - have worked to develop
the area from their individual positions. During several programme
periods, e-health and knowledge intensive business services have
been a prioritised growth area. Looking back at older strategy
documents, we find that thoughts of e-health, distance bridging
technology, and an infrastructure for information technology was
prioritised as early as 1995.
Another prioritised area that has been significant in the work
with the health care of the future is internationalisation. Utilising
the opportunities of EU membership has also been prioritised since
a long time back. Looking after interests, utilising the opportunity
to make contacts, establishing strategic alliances, and participating
in development programmes has been high on Norrbotten’s agenda.
Long term prioritisation and an international perspective are important success factors, but the main driving force has been the need to
solve problems, in particular problems that stem from Norrbotten’s
demographics and geography. There were challenges that needed to
be met, and there was a great deal of know-how regarding distance
bridging technology at Luleå University of Technology. Today’s result
is that the county has developed ability and knowledge in solving
the problems that appear.
Geography and demographics are a challenge
Norrbotten is a large county with vast distances. The demographic
development and future supply of competence are the county’s greatest challenges. The supply of labour and competence to match the
demands of businesses and the public sector is crucial to growth.
Norrbotten is the largest by area and northernmost county in Sweden and the only Swedish county sharing a land border with two
countries – Norway and Finland. Together with the vast natural
resources, broad cultural spectrum and vivid contrasts, this gives
the county a clearly-defined profile.
Norrbotten is a county of contrasts – contrasts between winter
dark and midnight sun, alpine areas and archipelago, sparseness and
city life, and a diversity of cultures. The national minority languages
Finnish, Meänkieli and Sámi are spoken here. The Sámi parliament
has its seat in Kiruna. Norrbotten has the highest mountain in Sweden, Kebnekaise at 2,107 m, and Sweden’s deepest lake, Hornavan,
232 m deep.
Norrbotten County makes up 25 per cent of Sweden’s surface
area, and is thus Sweden’s largest county at almost 100,000 square
kilometres. Norrbotten is as big as Austria and ten times bigger
than the Swedish county of Skåne. Around a quarter of a million or
250,000 people live here, which means that 2.6 per cent of Sweden’s
population live in Norrbotten, on a quarter of the country’s surface
area. If the population density of Norrbotten County was equal to
the EU average, 12 million people would be living here.
Norrbotten County came into being in 1810 and consists of 14
municipalities; Arjeplog, Arvidsjaur, Boden, Gällivare, Haparanda,
Jokkmokk, Kalix, Kiruna, Luleå, Pajala, Piteå, Älvsbyn, Överkalix
and Övertorneå. The coastal area is the most populated part of the
county. Most of them about 170,000 live in the coastal area within
a few dozen kilometres of Luleå, the county town, making it the
most densely populated area in northern Sweden.
Inland, there are natural resources in the shape of forests, ore and
hydropower, while most of the industries are situated on the coast; in
Piteå, Luleå and Kalix. The ore fields with the mining towns Kiruna
and Gällivare have 40,000 inhabitants combined. The northern part
of the Gulf of Bothnia, on the Swedish and Finnish sides, has around
half a million inhabitants. From a Nordic perspective, the coast of the
northern part of the Gulf of Bothnia is a densely populated growth
area. The Barents region, made up of the northern parts of Sweden,
Norway, Finland and Russia, has around six million inhabitants.
Norrbotten belongs to this large, northern region, which is attracting
more and more interest from the EU and the world.
Recent developments
Since the latter part of the 1990’s, population numbers have
decreased, despite large investments in businesses and industries.
An ageing population increases the number of dependants, and
maintaining welfare systems with decreasing tax income becomes
increasingly difficult. Young people – girls in particular – move
away from the county and the imbalance between men and women
increases. Norrbotten also has high youth unemployment and a relatively large share of students leave school early. It’s mainly boys who
don’t complete upper secondary school, but the disparity between
the municipalities is great in this area. The educational levels in the
county are lower than the national average, and there are large differences between women and men. The number of people suffering
with ill health is higher than in other regions; one explanation is the
isolation that follows from unemployment.
The county’s geographical conditions place certain demands on
a sustainable transport system. Functioning communications and a
well-developed infrastructure are crucial to the region’s development
and growth. An increasing lack of housing in several parts of the
county affects development and growth negatively, and can, in the
long run, have an adverse effect on migration into the county and
individual municipalities. Access to attractive housing is a success
The work with attractive living environments, equality and
diversity is important to attract more people to the county, and
increase the quality of life for the people of Norrbotten. Conscious
work with openness is required to break down traditional patterns
and stimulate the ability to be innovative and creative.
The county is doing well competitively in terms of research and
development at the university and other research facilities. There is a
relatively good potential for renewal and innovation in the county’s
businesses and industry which can be strengthened through more
R&D investment in this area. Market ability needs to be strengthened, and exchange between academia and businesses needs to grow.
There is good knowledge and experience in the energy area in
the county. The big, global challenges in the climate and energy
areas create driving forces for development in both technology and
society. Internationalisation and transborder collaboration are success factors for Norrbotten, with its geographical position, partly
through increased critical mass, and partly through a larger market
for businesses.
Regional development in Norrbotten
The County Administrative Board is responsible for regional
development in Norrbotten. Based on its role as the only political
body on a regional level that is directly elected, the county council
has a long history of working with regional development. The vision
of the county council is for the people of Norrbotten to live rich
and fulfilling lives in a region full of vitality and growth. The county
council’s steering documents say that the county council is to contribute towards Norrbotten’s development, and create conditions for a
sustainable society and a good living environment. This is achieved
through active, regional development efforts and cultural activities.
Collaboration around regional development issues has been good
over the years. For instance, several parties participate in the work
with writing, but also implementing and following up on regional
strategies and programmes. The regional partnership in Norrbotten is
a formalised collaboration between municipalities, the county council,
authorities and organisations. The county governor leads the work.
The parties in the regional partnership take joint responsibility in
the planning, decision and implementation process, with the purpose
of gathering strength and coordinating resources to strengthen the
county’s position and attractiveness. The regional partnership has
two committees: the Growth committee and the Competence supply
committee. The advisory committee makes up the secretariat, and
does, for instance, prepare the meetings of the regional partnership.
Examples of strategic tasks handled by the regional partnership are:
•Decisions in important regional development issues.
•Choosing paths, strategies and prioritisations.
• Leading the process of implementing, upgrading and following up
the county’s programmes and strategies.
• Leading the process of developing new programmes, for example
EU programmes.
Organisations participating in the regional partnership are The Swedish Public Employment Service, Entrepreneurs of Norrbotten, the
Norrbotten Association of Municipalities, LO, Luleå University of
Technology, Norrbotten County Administrative Board, Norrbotten
County Council, Norrbotten Chamber of Commerce, SACO, The
Sami Parliament, The Swedish Transport Administration and Unionen.
The advisory committee is the secretariat for the regional partnership. The group does, among other things, hold the responsibility of
planning meetings where strategic development issues are discussed,
and where programmes and strategies are decided upon. The advisory
committee consists of officials from the Association of Municipalities,
the County Council, Luleå University of Technology, the Swedish
Public Employment Service and the County Administrative Board.
Regional confusion in the north
The issue of creating EU style regions in Sweden has been discussed and investigated many times since the 1990’s. In the early
2000’s, municipal collaboration bodies were discussed. Following
the final report of the responsibility committee, the work with a
larger, united region in Norrland began. At first, a four county solution was discussed, but after the announcement from Jämtland and
Sundsvall that they did not want to belong to a Norrland region,
the work carried on with three counties – Norrbotten, Västerbotten
and Västernorrland.
The county council sought permission from the government to
form Region Norrland, and the work with creating a united Norrland
region was organised in the voluntary organisation Norrstyrelsen.
The government passed the request to Kammarkollegiet, and then to
Mats Sjöstrand and his overhaul of public, regional administration,
with the added task of suggesting new division of county councils
in Norrland and Svealand. The counties could not agree to form a
region from 2015, and thus, no new geography will be suggested.
In Norrbotten, the work with the region issue was continued at
the end of 2012, when Norrbotten County Council sought permission from the government to take over the regional development
responsibility from the County Administrative Board starting in
2015. In the autumn of 2013, the government decided not to agree
to the requests from Norrbotten, Västernorrland and Västmanland
to take over the regional development responsibility from the county
administrative boards. The government chose to agree to the region
requests from the counties that had previously formed municipal
collaboration bodies, and that had thus already taken on parts of the
County Administrative Boards’ areas of responsibility. This means
that the county councils in Jönköping, Örebro, Gävleborg, Kronoberg, Östergötland and Jämtland can become regions from 2015.
An innovative ICT region
Norrbotten is the least densely populated region in the European
Union, with a population density of just 2.6 inhabitants per square
kilometre. This means that many inhabitants have to travel far to get
access to primary care and hospitals. The need for health care with
high accessibility, medical safety, quality of care and productivity is
great, and the health care system has to give access to equal quality
care regardless of where the citizen lives, despite the vast distances.
The geographical challenge and the fast increasing number of
elderly inhabitants (the oldest in Europe), with an increased need
of health care has meant that the development of ICT solutions in
health care has been given high priority. The great challenges have
been turned into growth opportunities instead of obstacles, as Norrbotten was a hotbed for distance bridging solutions from early on,
and this position has been useful in the development of e-health.
Distance bridging solutions can of course be used in other, more
densely populated areas as well, where they can contribute to higher
productivity and improved quality of life.
In the 1990’s, several centres with focus on distance bridging
technology and its uses were formed at Luleå University of Technology: Centre for distance bridging technology (CDT), health (CDH),
media (CDM) and learning (CDL). The establishing of Centre for
distance bridging health (CDH) can be viewed as the start of the
county’s efforts in e-health. This, in combination with the county’s
geographical area and demographics formed the conditions for the
development that was to come.The distances and demographics
demanded streamlining and handling of all problems posed by great
distances. The technology was available at the university, and since
several programmes and EU means were directed to this area, the
conditions were right for development and implementation. CDH was
financed by the County Administrative Board, the County Council
and the Boden, Luleå and Piteå municipalities.
There is an advanced infrastructure for ICT in the region. Nine out
of ten inhabitants have access to the internet through broadband
connections. Most homes have a computer, and, as all other Swedes,
a high degree of ICT knowledge, and willingness not just to use
existing technology, but also to try new solutions.
The extensive use of ICT in health care has led to improved service
for the inhabitants and patients, but has also been advantageous for
organisations and good for costs. The aim is to use e-health solutions to increase the opportunities to reach everyone with health
care, everywhere and at any time. Among other things, the people
of Norrbotten are to be given the opportunity to access their own
medical records, communicate with the health care system in a safe
way – from home or whenever it is necessary. This has been made
possible through a continuous implementation of ICT solutions
with high interoperability, i.e. various systems’ ability to function
and communicate with each other, which gives correct information
throughout the care process. Interaction, distance bridging and accessibility are important parts of the development.
To further improve the care systems and increase regional financial
growth, great investments are being made into new research and
innovation projects about e-health. E-health solutions are environmentally friendly, as they decrease travel for staff, patients, and
their relatives alike. They give increased access to leading experts
and lower costs. It is a wise use of human and financial resources.
The county’s good infrastructure for information and communication technology, coupled with an ambition to use our EU membership
for strategic alliances, positioning the county internationally and
nationally, and participating in development programmes are some
of the factors that have driven e-health as a growth area in Norrbotten. This has been possible thanks to the county’s competence in the
distance bridging technology area as well as our long experience in
using said competence to handle the county’s geographical position.
The vast distances require innovative thinking and smart solutions.
Investments were made early in shared infrastructure and fast and
secure broadband.
The limited company Information Technology Norrbotten, IT
Norrbotten, was formed in 1996. The idea was for the company to
be a development motor for cutting-edge technology and business
driving IT projects in Norrbotten. Behind the initiative were regional
businesses, the Norrbotten municipalities and Norrbotten County
Council along with Norrbotten County Administrative Board and
Luleå University of Technology.
Throughout the years, IT Norrbotten has run several successful
projects in a variety of areas: remote education, e-trade, remote
work, telemedicine, infrastructure, etc. Today, the main task of the
company is to administrate, develop and provide IT infrastructure
jointly in the whole county of Norrbotten. Since the spring of 2005,
the company is owned by Norrbotten’s 14 municipalities and Norrbotten County Council.
One of the company’s important tasks is to create a rounder
Norrbotten. In practice, this means that all citizens and operations
in the county are offered the same choice: a multitude of services
at competitive prices. In a sparsely populated county, the distances
between towns are great, and the journeys to schools, services,
care, etc. are long. This makes broadband particularly significant
for individuals and businesses to participate and develop in society.
A rounder Norrbotten means shorter distances, not just within the
region, but nationally and internationally as well.
Multi-level steering, the international position and strategic alliances
An important part of the development in the e-health area has
been the investment into international collaboration, which, in
practice, has come to be multi-level steering. Multi-level steering
means a dialogue on issues where the responsibility is shared between
society levels. It demands coordination of contributions from the
EU, the member states and the local and regional democratically
elected bodies.
The international perspective is important for Norrbotten to be
competitive in a globalised world. Today, we are seeing increased
competition between Europe’s around 300 regions. This increases
the demands on Norrbotten of positioning itself. The background
to the county council’s international involvement, therefore, is to
ensure the region’s development and competitiveness in the long run.
In the early 2000s, Norrbotten County Council decided to work
actively with positioning Norrbotten internationally. That led to the
county council getting involved with the European lobby organisations Assembly of European Regions (AER) and Conference of
Peripheral Maritime Regions (CPMR). Today, several county council
politicians have international commissions within these groups. Several of the county council’s politicians are driving in international
forums. There is an active staff of officials to support the work. The
joint mission is to strengthen Norrbotten’s position in international
contexts through, for instance, strategic alliances, networking and
collaboration on international and inter-regional levels.
The county council has, for several years, worked with creat61
ing opportunities for the area through participation in AER and
involvement in the committee for social issues and health. A working group was formed, with county councillor Agneta Granström
as chair. Granström’s chairmanship in the working group and vice
chairmanship in the committee has given the county council and
Norrbotten access to strategic alliances, opportunities to influence
programmes and future publications, and marketing of Norrbotten
and the county council as an interesting project partner, as well as
arenas to influence the development of the area.
Politicians and officials have worked actively with positioning Norrbotten. The work has taken place at home, in the shape of increased
knowledge, and in EU contexts, through the county council gaining
influence for political positions. The fact that Norrbotten gets to receive
study visits, organise conferences etc. contributes to the spreading of
good examples and stimulation of the development work in the region.
Today, the county council holds important posts within AER’s
committee for social politics and health. A close dialogue and collaboration with the commission and the European regional level
has been important for Norrbotten. Political representatives from
the county council have been invited to ministerial conferences and
other strategically important events. The county council has often
moderated, and been able to highlight issues of particular interest
for the county council and Norrbotten. The results are important
contacts and the opportunity to influence the design of future EU
policy in the area.
Norrbotten is, as mentioned previously, a large county with vast
distances and just over 247,000 inhabitants. Even though the county
administrative board has the assignment from the government to be
responsible for regional development, the county council and the
association of municipalities are active in the work with regional
programmes and strategies. There is good collaboration between the
officials of the organisations, where the work in the joint advisory
committee (regional partnership advisory committee) has great importance for the collaboration. It creates proximity and relatively
short routes of communication, which gives one advantage: the
regional financiers are on the same page.
Meeting places for the health care of the future
The e-health conferences organised in Norrbotten in the 2000s
were important events for the development of the e-health area. The
initiative came from a separate company from Piteå, a development
centre for health and care. The entrepreneur saw the opportunities
offered by present and future technology in the areas of health, care,
research and regional development. Key people were invited to the
conferences; IT strategists, researchers, politicians and health care
managers met to discuss implementation. Since then, international
e-health conferences have been organised in the county by Norrbotten County Council around every two years.
Information technology has a lot to offer. It can work as security
and support in care, and it can be used to improve accessibility and
quality of diagnostics and treatment. Safer and quicker diagnostics,
IT support in home care, electronically based joint medical record
systems and transborder, advanced care are some examples of this.
Technology can also help solve the recruitment and staffing problems,
and contribute to increased competence in care.
With increased demands to keep the costs down, advanced
technology can also be a solution to maintain high quality in care.
E-health is a requirement for the health care of the future, and it can
also contribute to a belief in the future and vitality in the northern
areas affected by depopulation. Used in the right way, it can become
a driving force for growth and regional development in businesses,
research and health care.
All this does, however, require new working processes and collaboration between several different parties. Before information
technology and technical equipment can be used in an optimal way,
we therefore have to create action plans for the future and find concrete forms of collaboration. The questions are many: What demands
can be made? What risks and difficulties are there?
If you’re seen you exist – the importance of visibility
It soon became apparent that the work with e-health had to be
communicated. Communication is an important tool in the work
with regional development. More people needed to know more about
e-health and the work that was being carried out in the county within
the county council, the university and businesses.
One part is about internal communication within the county
council to create curiosity and acceptance for new technology. Another
is about highlighting to other regions, nationally and internationally, what the region does within the area – a way of positioning
Norrbotten as an attractive collaboration partner. Some examples
of arenas where the county’s work with e-health is communicated:
•AER committee 2
•AER committee 2 - working group
•Open days in Brussels and home events
At the end of the 00s it was decided that the centre for distance
bridging technology should be reinforced with more resources. The
task was clarified, and CDH became EIC (E-health and Innovation
Centre). The county council decided to invest in a centre for e-health
and a committee was appointed. The aim was to strengthen the connection to the concrete needs in today’s health care further.
Luleå University of Technology in Norrbotten hosts EIC. The projects run within the CDH and EIC framework have been characterised
by triple helix collaboration. During this time, businesses have also
participated in the work with developing the health care of the future.
New times and new challenges
Today, work with the health care of the future has been ongoing
for several programme periods. When the regional development
strategy was revised in 2011, e-health and knowledge intensive business services were among the prioritised areas. In the innovation and
renewal area, increased investment in innovation in the public sector is highlighted as an important measure. The financial tools - the
European structure funds, future framework programmes (Horizon
2020) and transborder funds - will enable ongoing investment.
Work with the health care of the future places demands on new
work processes. Today, there is an awareness of the opportunities of
e-health technology, and new routines are introduced, albeit slowly.
It is difficult to implement new products, service and systems more
widely, since the consequences can be difficult to evaluate.
A clear direction is needed. We lack a cohesive strategy for e-health
within the Norrbotten County Council. On the regional level, work
with developing a regional innovation strategy is ongoing, and the
county council plans to develop an innovation strategy. Also on the
regional level is the task of developing a regional, digital agenda.
The ongoing evaluation of local health care creates opportunities for
a more extensive implementation of e-health (or the health care of
the future) in the operations of the county council. Together, these
policy documents could form the basis for a cohesive e-health strategy.
There are many parties participating in the work with the health
care of the future. There are collaborations between businesses and
academia, but also with other regions. Collaboration takes place
between several levels - from local and regional to national and international. Collaboration needs to be improved and made more real,
for instance with our neighbouring county Västerbotten. Even if the
parties currently consider themselves to be working closely together,
established structures and platforms are important for collaboration. There is established collaboration with Norway and Finland.
Innovation Gateway North
The public sector is facing great challenges, and there is a need
for increased innovation power in operations. In many ways, it is
an untapped, potential resource for innovation and development of
new products and services. The public sector has an annual turnover
of 928 bn. SEK (2011) and 480-580 bn. SEK in public purchasing.
In Norrbotten, the county council is the biggest employer, and has
operations in every municipality.
One step towards increasing innovation power and utilising
the potential is the Innovation Gateway North project, which aims
to find new structures for how ideas for innovation in health and
care are best to be taken care of to lead to finished products and
solutions. The aim is increased numbers of start-ups and growth
in the region, as well as improvement to the quality, efficiency and
productivity of health care.
The target group is carriers of ideas working in health and care, but
also patients, users and relatives with ideas of new products or services.
Small and medium sized regional businesses that want to develop and
adapt products, services or systems for health and care are helped
with inroads to county councils, municipalities and care companies.
Public purchasing leads to opportunities and obstacles in the
implementation of e-health. Within the framework of Innovation
Gateway North, innovation purchasing is trialled as a tool for
problem solving. Put simply, innovation purchasing means that the
purchasing party, in this case the county council, is open to, and
utilises the supplier’s ideas of renewal.
Test bed – an important next step
Experience shows that it isn’t easy for businesses to get appropriation for products, services and systems. The difficulty is not in
the development, but appears during the next stage, in wider implementation. There is ongoing work in the county with establishing a
test bed for person-centred local care with focus on the whole chain
from idea and innovation through to implementation and utilisation.
Health care in Norrbotten County Council has been reorganised into
the new sections Local care and County care. The new organisations are to ensure good care for an ageing population with growing
and more complex care needs, while also meeting future demands
for specialisation and medical quality. The county council has just
implemented this restructuring, and has a great need to find new,
innovative ways of working to manage the change.
Implementing new processes, methods, routines, services and
products widely is a challenge in any large organisation. The challenge is not normally in the technical area, but is often about the
organisation’s and people’s interaction, which in turn, is governed
by roles, responsibilities and relationships, competence, leadership,
measuring and follow-up systems, communication and staffing.
Meeting the patient’s need for safety, participation, continuity, coordination and security in care that is changing, with more and more
new parties, requires solutions that ensure cohesive care, regardless
of home town, age and diagnosis. There is also a pronounced sup66
port for this within the EU and nationally, as well as in the county’s
development and innovation strategies finalised by the county’ regional partnership, including entrepreneurial organisations. The test
bed is needed in the region to strengthen existing investments and
create a complete innovation environment where one can - across
organisation borders - develop, test and evaluate solutions which can
then be implemented widely in all five future local health care areas.
Through the Test bed person-centred local health care project,
the county council and local health care want to establish, develop
and implement a trial environment, a competence centre for development and implementation of new ways of working and processes
with focus on person-centred local health care. The test bed is also
a complement to the county council’s and the region’s ongoing investment in e-health and innovation, and gives us opportunities to,
in an organised way, test different ways of working, collaborating
and developing different tools.
The test bed has regional, national and international anchoring, while working from a local/regional solution. The focus of the
test bed will initially be on the needs of the elderly and those with
multiple diagnoses, particularly directed towards stroke/TIA care,
dementia and palliative care. The national guidelines for the patient
groups will be an important starting point for the work. Operations
will begin in Piteå, which today operates a person-centred model.
The project is expected to strengthen health care as a growth area
through the collaboration in a clear structure of care-givers, businesses, academia, society, users and staff. Innovation processes and
purchasing systems will strengthen each other, and development
occurs based on actual needs.
Business models – business driven
One obstacle to continued development of health care as a growth
area is the lack of business models and business drive. There is a lack
of competence around business models for this type of operation.
Furthermore, the business logic perspective is missing from health
care, which is dominated by a “from the inside” perspective. This
makes it harder to see health care as a growth area.
Developments in health care lead towards a clear individual
orientation: from “the patient at the centre” to “the citizen during
a large part of life” is the trend. It’s about long processes rather than
focus on a separate care situation. Transborder processes leading to
a bigger focus on wellness and the health part of health care are also
new. The question is no longer health care, care, or health. We now
see things in a wider perspective. How well is Norrbotten doing in
that development?
What we’ve learnt
The county has become successful in developing solutions to real
problems which often have their basis in geographical conditions, but
are also due to a lack of competence supply. By utilising knowledge
and competence, creating a critical mass, working on several routes
(the multi-level system) locally, regionally, nationally and internationally, the county has made use of its assets. It has been about moving
frames and creating conditions on several levels simultaneously, and
prioritising and daring to make changes.
Initially, there was a strong focus on technology, and resources
were invested into research and development projects. Operations
and the thought of how the new technology was to be implemented
were lacking. In spite of this, the technology itself has never been the
driving force in the development of care as a growth issue. Technical
knowledge of distance bridging technology has been a prerequisite
and an enabler.
The challenges have been a lack of platforms and structures for
cohesion. Initially, a strategy for the implementation was missing,
and strategies focused on developing the area as a growth area. The
e-health projects were run locally, and did not involve clinical staff,
users and management enough. Health care is a complex operation,
and there are several parties and decision routes (clinical, financial,
organisational, technical, laws, safety) to convince. The lack of
common standards can also be an obstacle.
People with vision - in health care, businesses, politics, officials,
and academia - have been of great importance, as they have all, in
their own way, contributed to the development of the area. In the
future, all parties must become better at describing the advantages
and gains to different parties, and develop decision materials for
the leaders and politicians who make the implementation decisions.
Political decisions can also include several levels: local, regional,
national and international (the EU). The conscious work with the
politician perspective has been significant and advantageous both
nationally and internationally, as it has put the county’s and Norrbotten’s work with e-health on the map.
A further success factor for the development of the area is the
fact that there is a receiver in health care for the products, services
and processes that are being developed. Future challenges are daring to be the first, being the world’s best demo environment and
an attractive region for health, growth, increased accessibility and
services. Current and future investments are innovative leadership/
innovation management and the future structure of the public
healthcare in the region.
From Rivalry to Cooperation in Östergötland
Östergötland is a county in Sweden known for its intense and innovative actions for growth. Private companies, municipalities and
public authorities have worked together in several areas of importance
to growth, especially since the Regional Council of Östsam became
responsible for the regional development. This chapter highlights an
underlying, important factor when it comes to public initiatives for
growth: paving the way for good cooperation and relations between
the partners involved. As many other counties, Östergötland has
gone from serious conflicts to well-functioning cooperation. The
way that such a change of perspective is made, and how experiences
can be used in other counties and situations, is essential to regional
growth politics.
The East Link as an Example of Good Partnership
The national government budget bill of the second half of 2012
revealed the government’s confirmation of the construction of the
East Link. This is a double track rail road from Järna, south of
Stockholm, to Linköping. The construction will start in 2017, and
the track will be ready in 2028. Even if a lot of work remains, this
means that probably the most important issue for the development
of Östergötland is completed with success.
The East Link will eliminate the bottle necks on the mainline
through Östergötland, and travelling from and to Stockholm will
be much quicker. Linköping will be closer to Stockholm, and so
will Malmö, Gothenburg and Skavsta Airport. At the same time, it
should be remembered that the capacity of the southern mainline to
Skåne and Copenhagen, and the mainline between Östergötland and
Jönköping, Borås and Gothenburg, still needs to be increased. The
vision is a railroad that connects big municipalities in the southern
part of Sweden, called Götaland, in order to create bigger labour
markets and increase the emergence of new and expanding companies.
High speed trains between Copenhagen in Denmark and Hamburg
in Germany are being discussed.
The East Link will be a governmental effort with considerable
participation of municipalities and regional partners. Many more
decisions need to be made before the construction can start, and
for the railroad to make a difference to commuters and business
activities. All public transportation nets will be affected, when it
becomes attractive to more people to travel by train. Companies as
well as individuals can move to Södermanland and Östergötland to
make use of the shorter commuting time. Both of these counties will
become an integral part of Stockholm in the future, in a way that
the county of Uppsala is today.
Until now, the East Link project has been primarily about forming the opinion of national decision makers, but it hardly would
have been possible without a profound change in the approach for
the development of Östergötland. A focus on common interests and
openness to coordination made the change possible. It has been a
long journey from fairly cold relations between the municipalities,
especially Norrköping and Linköping (the biggest and most competitive ones), to the present cooperation manifest named “The fourth big
city region”. This designation indicates that the two municipalities
of Norrköping and Linköping together are as big as Malmö (the
third biggest city in Sweden), and that they should be considered
in the same way by investors, the national government and others.
These are the underlying changes of the cooperation climate that
are discussed in this chapter.
Östergötland is an expansive and dynamic region with several
hospitals, a university with two campuses, and big internationally
competitive industries. The smaller towns have good public transportation connections with the bigger towns and cities, which means
that it is possible to keep living here and commute to work, or to
live in a bigger city and still be close to nature. Distinctive is, that
there are two big municipalities that have been competing about the
leader role. Norrköping was a huge industrial city for a long time,
but the university city of Linköping has passed it. Since the end of
the 1990’s, the university covers both municipalities, and the so
called “campus bus” is a tangible example of how they are knitted
together. High technology research centres in both towns indicate a
faith in the future. As in other counties, there is of course a covert
threat about structural changes leading to moving and merging activities in order to keep costs down. So far, the discussions have been
mostly about the future organization of the medical care. There is
also a potential gain in being more attractive than the neighbouring
counties when companies want to move to the area from Stockholm,
or from abroad.
A learning example
The development in Östergötland is an interesting example,
but not a unique one as regards new relations, a changed way
of working in the public sector and in relation to companies and
other organizations. The development is an example of so called
“new regionalism”, which is about emphasizing common interests
and working together in a goal-oriented way across organizational
borders (Keating 1998). The changes in Östergötland are partly
due to the new point of view of development, which I will get back
to. The word “governance” refers to something different and more
informal than “government”, which refers to the formal and more
hierarchical structure of the public sector (Niklasson 2003).
Our purpose is to give an overview description of the development process that has made the East Link possible, and to discuss
experiences of relevance to regional development politics in general.
The question to be answered is how the rivalry could turn into
cooperation in fields of common interests in the county (and with
other counties), with the East Link as the most recent example of
success. The analysis is of interest to authorities, municipalities and
companies, etc in other counties as Östergötland is similar to many
other counties in the southern half of Sweden. It considers itself
independent through its history and dialect. It is within two hours
of a big city (Stockholm), and the commuting for work is already
a reality.
A number of circumstances which have contributed to the development of cooperation in Östergötland is described in this chapter. In
retrospect, this development may seem self-evident, but comparisons
with other counties show many obstacles for regional cooperation,
and the interesting thing is how the municipalities, counties and
authorities managed to overcome them, or are about to. The sharp
question is why the cooperating partners in Östergötland are further
ahead than partners in other comparable counties (Statskontoret
2004a). The comparisons fortify the analysis, but will only be implied
here. They are described in other contexts.
There is comprehensive literature on growth that discusses terms
like collaboration, consensus, leadership and learning. In particular
American contexts, with a highly fragmented public sector, emphasize
“collaborative leadership” (Chrislip & Larson 1994), cooperation through planning (Innes & Booher 2010) and collaboration
for economic development (Agranoff 2004). Regionalism is often
synonymous with creating arenas for collaboration in big city areas
that consist of many small municipalities (Feiock 2004, Benjamin
& Nathan 2001). Similar ways of working is found in many other
Western countries, e.g. Great Britain and Australia (Beer, Haughton
& Maude 2003), and in developing countries like Brazil, India and
South Africa (Briggs 2008).
The interest in collaboration partly coincides with a general interest in innovation systems, which is a descriptive and pragmatic way
of analyzing participants and processes of growth. The analysis is
based on recurring interviews with the regional organizations involved
in Östergötland, and with the same kind of organizations in other
counties. The first study in 2003 was about cooperation within the
Regional Growth Agreements, and the following Regional Growth
Programmes. The results were presented in a report by The Swed74
ish Agency for Public Management (Statskontoret; 2004a) which
included a discussion about plausible explanations to the successful
cooperation in Östergötland. A complementary study was made in
2004, in which Östergötland was used as an example of comparison
in the evaluation of Region Skåne and Region Västra Götaland2
(Statskontoret 2004b). Both studies were scientific theses (Niklasson
2004 and 2005). A third study was made in 2011 as a part of an
analysis of the infrastructure projects in Sweden, financed by the EU
regional fund (Niklasson & Sandström 2012). Lastly, complementary
interviews were made for this study.
Another source of inspiration is literature about the fragmentation
and integration in the public sector. So called “joined-up government”
(Bogdanor 2005) is a way of networking across organizational borders
with the intention to achieve common goals (Niklasson 2003). This
point of view is especially usual when it comes to regional politics
in many countries (Niklasson 2007). The perspective can be applied
on public activities in general, and on relations between companies.
Sociologists and business economists discuss, among other things,
learning in and between organizations (Stein 1996).
The criticism against collaboration is primarily found in the
discussion about how the public sector should be run. The opposite
to collaboration as an ideal is a clear division of responsibility with
absolute goals for each and every task alone. The key issue is to
demand responsibility (Bovens 1998). Another point of criticism
is the risk of white collar government, which is a consequence of
agreements and adjustments according to circumstances made by
the public organizations (Sorensen & Torfing 2007).
Those in favour of collaboration often regard it as the second
best way to deal with an indistinct division of responsibility between authorities or other organizations on e.g. the regional level.
Some elevate collaboration to an alternative form of democracy
(Hirst 1994), close to a sort of autonomy for a territory. Others
emphasize the ability to solve problems as an essential, but to some
extent, neglected value in democracy (Briggs 2008). In all modesty,
Östergötland appears to be as interesting to discuss as e.g. Pittsburgh
or Sao Paolo (Briggs 2008).
Between Collaboration and Conflicts
The following reasoning focuses on understanding the overall
change in Östergötland, from conflicts and rivalry to established
cooperation. The East Link project is an important part of the
cooperation, but this analysis concerns the general cooperation
between different organizations in Östergötland. What makes rival
municipalities change perspectives, tone down disagreements and
instead emphasize common gain (as well as looking for common
cooperation partners outside the county)?
Conflicts and different perspectives still exist. Cooperation does
not require that everybody thinks alike, only that they can prioritize
the common good in all important situations. The differences were
exposed when the county and municipalities were to choose the
future organizational structure in the summer of 2012.
The suggestion was that the Regional Council of Östsam should
be merged with the county of Östergötland in order to create a
bigger organization with a more comprising mandate, and more
capacity for initiatives and actions. It was supported by some, but
not everybody. The chair person of the municipality of Norrköping
wanted regional development to be a national responsibility, like
before (Johansson & Niklasson 2013). Although there are different opinions about how regional development should be run in the
future, the Regional Council of Östsam has played an important
role during the last decade.
The making of Östsam was a manifestation of the willingness of
the municipalities and the county to cooperate, since it demanded that
all of them wanted to become members and contribute financially
to the organization and its work. Afterwards, Östsam has become
a development engine in the county. The cooperation processes in
the county can be divided into two periods: one which led to the
overtaking of the regional development responsibility by Östsam in
2002; the following one, which led to the confirmation of the East
Link by the Swedish government.
The progress of change in Östergötland becomes especially interesting in the light of the conflicts that existed until the beginning
of the new millenium. There are many stories about the trauma
that Norrköping experienced when it lost its position as a leading
industrial city. To the visitor, it is obvious that Norrköping has been
a rich city with a great amount of self-confidence. The boulevards
and architecture reveal an almost unimpeded success from the 17th
century of Louis de Geer3 until the 1970’s. Moreover, during a period
of time, Norrköping was a county of its own.
Norrköping eventually became dominated by the textile industry,
which ended up in a crisis all over Sweden and other Western European countries in the 1970’s, when cheap import from low wage
countries took over. The Swedish government managed to hold back
the massive fall to some extent by moving authority head quarters
to Norrköping. The most recent measure is the modernization of
the old industrial premises into an enticing environment for the
university’s Campus Norrköping.
Linköping used to be the county seat with a bishop, a governor
and higher education. The relationship between the two cities were
similar to the one between two other Swedish cities, i.e. Malmö
and Lund, or Falun and Borlänge – one bigger, industrial city and a
smaller, more academic city that to a large part is governed by national authorities, and often run by a conservative, political majority.
Linköping’s good fortune was that SAAB established an airplane
factory in the city, which in the 1960’s became a reason for establishing a university of technology I n the city. There was a strong
pioneer spirit in the field of technology, and the university made
itself a name as an innovator, e.g. by initiating new educational programmes (industrial economy), new methods of teaching (problem
based learning) and transversal research environments on different
subjects (Niklasson 2012). The making of the technology village
Mjärdevi manifested Linköping as a center of high technology in the
south of Sweden. Linköping had a steady growth rate, in line with
the pattern that the university cities were basically the only cities
in Sweden that expanded. Eventually, the little brother grew larger
and stronger than the big brother.
The rivalry between the two large municipalities was strong in the
90’s, but at the same time, there were voices for cooperation. If the
battleaxe could be buried and focus could be on the common good
for Östergötland and its development, a different national position
would be achieved. But time was not ready for collaboration.
The 90’s – a Decade of Conflicts
In the 1990’s, the big symbolic question in Östergötland was the
one about the airports. Both municipalities had military airfields, and
Linköping also had the airfield of SAAB. There was civil flight traffic
in Norrköping and Linköping (SAAB), with problems of competition
and profitability in both places. At the same time, a debate started
about the future need for a bigger airport south of Stockholm. There
was an opportunity to take the initiative and promote an airport in
Östergötland as the new Arlanda (Stockholm international airport),
south of Stockholm.
The municipalities discovered the strategic possibilities, and
decided to build a common airport in Norsholm, between the two
cities. A scandal in Linköping stopped the airport from ever being
built. Instead the smaller town of Nyköping in the neighbouring
conty of Södermanland seized the opportunity to modernize its old
military airfield at Skavsta, shaping it into a new airport for the
whole southern Stockholm area. The municipality of Nyköping
made a deal with Ryan Air, and the rest is history.
Skavsta Airport has a bigger catchment area, and is therefore a
better location for a big airport, but that does not exclude the fact
that an airport in Norsholm could have been possible. Especially
when flight traffic was regulated and SAS was the big player, there
were possibilities to govern it. A common airport would have made
Östergötland more visible on the map, and could have been the
beginning of a population center along the 40 kilometres on the E4
interstate, which separates the two cities. Logistical companies and
industries could have considered this an attractive area.
The fiasco of a common airport has been described as important
inspiration for improving the cooperation in Östergötland. There is
a clear pedagogical aspect to the situation, when the rivalry between
the cities results in loss for both of them. When two partners are
not on speaking terms, a third part will win, in this case Nyköping.
If the two partners can agree with each other, both of them can
win, even if one might win a little more. In other words, the gain of
Linköping does not necessarily mean the loss of Norrköping. The
situation is not a zero sum game between the two municipalities.
Based on the new mindset, it is both desirable and possible to form
an organization together, in order to achieve development for the
common good. When the Swedish government offered the opportunity to constitute a Regional Council in 2002, the municipalities
and the county council took it and formed Östsam.
Turning to collaboration
The airport issue can be considered the vital spark, although
not everybody agrees with that description. There were many other
reasons. One is that, already in the 1960’s, ways of development
were analyzed. The County Administrative Board under Governor
Per Eckerberg’s leadership wanted to outline what research could
contribute, and invited e.g. the Cultural Geographer Gunnar Arpi
to analyze development possibilities. What was then called regional
planning was intellectually imprinted, when key factors started to be
identified as well as causes and effects in the economic geography.
There is certain continuity from Eckerberg and Arpi to the East
Link, since the arguments for the East Link are based on ideas about
how infrastructure efforts can create conditions for development and
growth. The key word is regional enlargement, i.e. the observation
of the importance of how long it takes to travel a certain distance. If
the public transportation alternatives are well-developed, employees
and companies will move across a larger area. Their region becomes
bigger. In Sweden, the labour markets are expanding. They are becoming fewer but bigger, which means that commuting is increasing,
which in turn means that differences between local labour markets
can be an advantage.
Someone who loses his or her employment in Norrköping or
Motala can find a job in Linköping and vice versa. Thus, investments
in infrastructure can be a good move against unemployment, and
make it possible to work in the expanding cities while still living in
smaller towns. There might be other opinions about commuting, of
course, but it is still an interesting observation.
The regional enlargement is connected to the debate about the
merging of municipalities. There is a tension between the needs of
vicinity and the economy of scale in the public sector. On one hand,
it is very important to democracy and the participation of the citizens
to be close to the political decisions. On the other, it is getting more
and more expensive to keep up a small-scale organization. The discussion about regionalization can be considered an example of how
certain issues seem to be best dealt with in a context, which is larger
than the municipalities but smaller than the Nation-State. A similar
logic pushes the European integration forward, as the Nation-States
have united to deal with competitiveness, environmental politics, etc.
A new organization takes form
One reason for the success of Östergötland is the determined
behaviour of politicians and civil servants who have bridged the
different specializations that affect community planning. Single individuals have been “free but responsible radicals”, working across
organizational boundaries. Östsam has welcomed such individuals,
and enhanced its result oriented way of working, partly since it has
been a main task. Up until 1970, Sweden effected the merging of
municipalities step-by-step. The Nordic model with the municipalities as strong carriers of welfare services, seem to demand a certain
degree of large-scale operations. However, many municipalities have
a hard time fulfilling their obligations, and are looking for ways of
cooperating with their neighbours within a framework of regional
arrangements. This kind of structural change is often traumatic, and
can only be carried out if there is a diligent analysis and a political leadership. A regional organization can pave the way for new
cooperation alternatives.
It has been said about municipalities and regions that their politicians need to move up a stairway of knowledge, where they acquire
knowledge about the development possibilities of the organizations.
The self-image of a Weberian-type civil servant who simply follows
given instructions is insufficient. The economical geography is changing, and there has to be a local and regional leadership that interprets
the needs for change and makes necessary adjustments. Furthermore,
a way of working that bridges the far-reaching specialization in the
public sector is needed. Today’s municipalities are divided into specialized functions with different missions, e.g. to observe business
and commerce development, or environmental issues. Specializations
run the risk of becoming trench wars with basically no possibilities
for dialogue or an overall picture.
There is a deep collaboration culture in Östergötland. When the
Swedish government encouraged authorities to collaborate with each
other and with companies within the frames of regional growth agreements, Östergötland took the opportunity. An internal evaluation
revealed huge conflicts in the beginning, but in 2003, the situation
was the opposite. Authorities and municipalities collaborated to a
great extent in fields like training skills (Arbetsförmedlingen, i.e. the
Swedish Employment Agency, and the municipalities) and support
for new enterpreneurs (Arbetsförmedlingen, the County Administrative Board, Almi5). There were examples of authorities covering
up for each other when they ran out of resources, with the purpose
of creating an image of the public sector as an entity instead of the
fragmented mesh of overlapping and rival organizations, that they,
in fact, were. Meeting authority representatives in 2003 was like
meeting one coherent Östergötland Public Authority. The difference
was obvious, compared to other counties where authorities did not
consider any matters in common at all (Statskontoret 2004a).
The government called for collaboration, but there were already
a lot of driving forces aware of the need. The County Administrative
Board was responsible for regional development until 2002, and
spread a good spirit. Other authorities gathered in the so called Lion
Group in order to provide collective service for the citizens. The pilot
scheme of regionalization included “citizen offices”, which brought
a focus on the perspective of the citizens. It became evident that the
authorities were motivated by the outsider’s perspective on their own
organizations, when it came to providing good service and taking the
full responsibility for tasks, which they were only partly responsible
for. The idea of “one door in” was dominant, and it was considered
a big problem that it was normally up to the citizens themselves to
find out what authority answered what questions.
At this time, information offices and so called “knowledge centres”
were opened in many parts of Sweden in order to promote the citizens’
accessibility to further education, without promoting the mandators. In the local context, a whole picture across the boundaries of
the organizations was necessary, and achieving that was prioritized.
The big problem was when authorities presented different information, or allowed matters to fall between the cracks. Later, in the first
decade of 2000, this changed when the Swedish government started
to emphasize the national conformity of each organization. Many
authorities have been made into one on a national level in order to
use the economies of scale in the internal systems. The obvious risk
of this situation is that the perception of entirety in the local and
regional contexts goes down. Basically, the question is whether the
public sector should be organized in aspects of functional specializations (coherent authorities) or in aspects of territorial integration
(county-based coordination; reference to Niklasson 2007)
To sum up, the collaboration atmosphere was built up through
a combination of new knowledge and insightful people. However,
the ignition spark consisted of a few traumatic failures. It is also
of relevance that there were fewer obstacles than in other counties.
High-level key persons with a negative attitude are often enough to
stop a driving force.
Experiencing Östsam
By the turn of the century, collaboration was firmly established,
and it was natural for the municipalities and the county council to
constitute the Regional Council of Östsam. An experiment with
different models for regional development responsibility had been
going on in Skåne, Västra Götaland, Kalmar and Gotland. In 2002,
the Swedish government decided to open up the “Kalmar model” for
other counties to try. Östergötland was one of the first counties to
implement the new model. The responsibility was transferred from
the national state level to the regional level, and some national means
went along. At the same time, some reponsibilities were transferred
from the county council to the regional council, e.g. the political
coordination of public transportation.
The constellation of a regional council basically means that a
comparatively small office is installed. The office has the function
of a resource for surveys and studies as well as a coordinator of the
development activities in the county. Furthermore, the council meetings become an arena for local and regional politicians, where they
can discuss general, common issues. Many specific fields of interest are still the responsibility of the municipalities and authorities,
and/or within the frames of EU programmes in the county. In some
cases, special project organizations can be set up, such as the East
Link Company. For Östsam, taking the lead is about convincing by
virtue of its capability.
Many people testify to the extensive and long-term work of Östsam. The organization has constantly been presenting knowledge and
research results, and arranging seminars with the county politicians.
An analytical leadership is one way of putting it: the challenges that
the county faces are put together into a common picture, and possible
ways to solve them are explored together. However, there are also
examples of how Östsam, as an arena, has contributed to “untying
knots” between politicians. Deepening personal relations and trust
turned out to be imperative. By bringing together leading politicians
and forcing them to discuss with each other, common solutions are
easier to find. In a more solemn way, it could be described as a sort
of deliberative democracy on the regional level.
There are many issues to analyze, but in a wider perspective, the
making of the concept “The fourth big city region” is one of the
main successes. The battleaxe was not only buried, but the bigger
municipalities were also able to build a common front. Together, it is
possible to redraw the map so that Sweden consists of four big city
regions instead of three. In the long run, it is realistic to picture a
united Östra Götaland County, ie the southernmost one-third of Sweden, competing with both Västra Götaland County and Stockholm6.
It needs to be discussed which other counties7 should be included,
but it becomes clear where such a new county has its powerhouse.
Norrköping and Linköping took big steps towards closer cooperation, e.g. holding municipal board meetings and creating common
layout plans. It has been more difficult to find common solutions
in other fields, like health care. The qualified services were about to
be concentrated to the university hospital in Linköping, but a local
opinion worked hard for a new hospital to be built in Norrköping.
The quandary of this is, that while some services become more accessible, other services are not accessible at all in the county.
It should be noted that the Swedish government was involved in
creating the concept of the fourth big city region. A study of how
important the big city regions are to growth was initiated. Norrköping and Linköping participated and thus, obtained support in
order to develop their cooperation. The government and the EU have
also contributed by financing development projects in the county.
The followers of a strong regional development responsibility
are doubtless in favour of the model chosen in Skåne and Västra
Götaland. It is stronger and more robust by virtue of its directly
elected council and its right to levy taxes. It is widely considered a
logical step to unify Östsam and the county council, even if there are
risks of a small organization merging with a bigger one, especially
when the small one is analytical, and the big one is operational. To
put it short, the risk is that the health care perspective of the county
council becomes dominant, and the development issues, that the municipalities and Östsam are interested in, end up on the backburner.
At the same time, the differences of opinion in 2012 show that there
are still different points of view when it comes to which way to go.
Apparently, there is a hesitation about the strategies of Östsam, since
the municipality of Norrköping prefers the responsibility for regional
development to be brought back to the government. Furthermore,
Norrköping is the municipality closest to Stockholm. The development
that culminated in the East Link is not a straight, ascending curve,
which might be the impression if only looking at the big achievements.
Many things can be learned from the example of Östergötland.
One is that it is possible to develop the regional cooperation to a
very large extent. Another one is that there will always be different
opinions, and that it is crucial to find ways to deal with that, and
adjust to new circumstances.
Knowledge, and building it up, is an indispensable tool, both
to make wise decisions, and to rouse public opinion and create
legitimacy. Many organizations have tools and are responsible for
different problems. Therefore, it is important to recognize mutual
needs, both within the region and with outside partners, e.g. national
authorities in Stockholm. That takes time and requires driving forces,
interested directors and perseverance.
Looking at it from an international perspective, it might be
added that is a good starting-point that independent authorities
and municipalities have much of the responsibility. The question of
who is responsible is still somewhat unanswered. One example is
the decision about infrastructure, which would be more effective if
planning and financing were managed on the same level. Instead,
regional wish lists are made for the national authorities to handle.
The regional politics include priorities for infrastructure, but it is
the Swedish parliament that decides about it.
Citizens should be able to earn a higher grade of influence in
other areas. E.g. further education could be organized by setting
up individual knowledge accounts rather than giving allowances
to the providers. The Swedish parliament decided about such a
model in the beginning of 2000, but it was never implemented by
the government at the time.
The example of Östsam shows the importance of an institutional
structure. A regional shouldering of responsibility can pave the way
for development activities. However, an institutional structure is
not enough to create conditions for cooperation and growth. Good
ideas and driving forces on all levels are necessary as well as support
from the national government. Such national support is especially
important when the organization, as in the case of Östsam, is not
elected directly by the citizens in the region nor has the right to levy
taxes. Instead, it has to push the development issues without its own
“economic muscles”.
Agranoff, Robert & Michael McGuire 2004: Collaborative Public Management: New Strategies for Local Governments, Washington DC:
Georgetown University Press
Beer, Andrew, Graham Haughton & Alaric Maude (red) 2003: Developing
Locally. An International Comparison of Local and Regional Economic
Development, Bristol: The Policy Press
Benjamin, Gerald & Richard P Nathan 2001: Regionalism and Realism. A
Study of Governments in the New York Metropolitan Area, Washington DC: Brookings Institution Press
Bogdanor, Vernon 2005 (red): Joined-Up Government, Oxford: Oxford
University Press
Bovens, Mark 1998: The Quest for Responsibility. Accountability and
Citizenship in Complex Organisations, Cambridge: Cambridge University Press
Briggs, Xavier de Souza 2008: Democracy as Problem Solving. Civic Capacity in Communities Across the Globe, Cambridge, Mass: MIT Press
Chrislip, David D & Carl E Larson 1994: Collaborative Leadership. How
Citizens and Civic Leaders Can Make a Difference, San Francisco:
Cooke, Phil & Kevin Morgan 1998: The Associational Economy. Firms,
Regions and Innovation, Oxford: Oxford University Press
Feiock, Ricard C (red) 2004: Metropolitan Governance. Conflict, competition and cooperation, Washington DC: Georgetown University Press
Hirst, Paul 1994: Associative Democracy. New Forms of Economic and
Social Governance, Cambridge: Polity Press
Innes, Judith E & David E Booher 2010: Planning with Complexity, London: Routledge
Johansson, Jörgen & Lars Niklasson 2013: Kommunernas region. Kommunernas inflytande i regionen, Stockholm: Sveriges Kommuner och
Landsting (The region of the municipalities. The influence of the municipalities in the region, Stockholm: The Swedish Association of Local
Authorities and Regions, SALAR)
Keating, Michael 1998: The new regionalism in Western Europe. Territorial restructuring and political change, Cheltenham: Edward Elgar
Kärnborg, Joakim, Regional Executive Director, Östsam, interview 19
June 2012
Nelson, Richard R (ed) 1993: National Innovation Systems. A Comparative Analysis, Oxford: Oxford University Press
Niklasson, Lars 2003: Nätverksförvaltningen: en ny förvaltningspolitisk
modell? Synopsis nr 2, Stockholm: Statens kvalitets- och kompetensråd,
KKR Network administration: a new politically administrative model?
Synopsis nr 2, Stockholm: National Council for Quality and Development, KKR)
Niklasson, Lars 2004: Learning networks for regional development: High
ambitions for Swedish regions, and a little help from Ryan Air, thesis
presented at the annual meeting of the American political scientists association, APSA
Niklasson, Lars 2005: More networking after devolution? Evaluation of a
Swedish experiment in governance, thesis presented at the Public Management Research Conference
Niklasson, Lars 2006: Hur står sig svensk biomedicin? En internationell
utblick, Stockholm: SNS Förlag (How does Swedish bio medicine compete? An international look ahead, Stockholm: SNS Press)
Niklasson, Lars 2007: Joining-Up for Regional Development. How Governments Deal with Wicked Issues, Overlapping Policies and Fragmented Responsibilities, Stockholm: Statskontoret (City office)
Niklasson, Lars 2012: Den högre utbildningen och företagens kompetensförsörjning, Projektet Företagens kompetensförsörjning, Rapport nr 3,
Stockholm: Ratio (Higher education and companies’ maintenance of
competence, the project “Companies’ maintenance of competence”, Report nr 3, Stockholm: Ration)
Niklasson, Lars & Sandström, Per 2012: EU:s regionala utvecklingsfond
som finansiär av infrastruktur i Sverige: Insatser och effekter, Rapport
0113, Stockholm: Tillväxtverket (The regional development fund of the
EU as a financial source of infrastructure in Sweden: Measures and effects, Report 0113, Stockholm: the Swedish Agency for Economic and
Regional Growth)
Sandström, Per, fd Östsam, interview 25 September 2012
Sorensen, Eva & Jacob Torfing (red) 2007: Theories of Democratic Network Governance, Houndmills: Palgrave Macmillan
SOU 2007:10, Hållbar samhällsorganisation med utvecklingskraft. Slutbetänkande av Ansvarskommittén (Sustainable society organizations
with development mandate. A final report of the Committee of responsibility)
Statskontoret 2004a: Det regionalpolitiska experimentet. Lärande nätverk för regional utveckling?, Rapport 2004:5, Stockholm (City office
2004a: The regional political experiment. Learning networks for regional development?, Report 2004:5, Stockholm)
Statskontoret 2004b: Regionalt ansvar på försök i Skåne och Västra Götaland: Bättre samordning och effektivare resursutnyttjande? Rapport
2004:32, Stockholm (City office 2004a: The regional responsibility as
an experiment in Skåne and Västra Götaland: Better coordination and
more efficient use of resources? Report 2004:32, Stockholm)
Stein, Johan 1996: Lärande inom och mellan organisationer, Lund: Studentlitteratur (Learning in and between orgaizations, Lund: Student
Literature Press)
Analytical work as an instrument
for collaboration in Scania
There is widespread consensus that the economy of the future should
be characterised by a higher knowledge content in the production
of products and services if it is to compete in the global market.
This approach is in particular present in the EU’s EU2020 growth
strategy, which talks of the need for “smart specialisation”. But this
is a major challenge for Sweden, as the institutional frameworks to
increase skills levels at the workplace are cumbersome.
In 2010, Region Skåne and the equivalent organizations in other
regions were commissioned by the national government to form
“regional skills platforms”. The area of skills supply is interesting
as an example of the need for multi-level control, as responsibility
is fragmented and there is a general lack of control instruments to
adapt the education system to meet the labour market’s needs. By
establishing a joint international perspective with the help of analytical work, a foundation can be laid for collaboration. This chapter
describes how analytical work has been used to lay the foundation
for practical collaboration within the regional framework. of Scania
The government commission
In January 2010, the national government commissioned the
regions to “establish skills platforms for collaboration in the field
of skills supply and educational planning in the long term and the
short term”. Region Skåne is responsible for this commission in
Scania (Skåne), in the south of Sweden. The commission included
collaboration with relevant regional and local players, consulting
and conducting a dialogue with governmental authorities in the area
of skills supply, as well as drawing up base data and needs analyses.
According to the government commission, this work is to be
based on forms of collaboration already established in the field
of skills supply in the county. The commission is to be carried out
in a dialogue with neighbouring counties, and to reflect the needs
of trade and industry and the labour market as well as functional
labour market regions.
The mandate specified the purpose of the skills platforms as
• enhanced knowledge and overview in the area of skills supply and
•coordination of needs analyses in the area of skills supply and
• enhanced collaboration on skills supply and educational planning,
•enhanced knowledge of supply and demand for forms of education, on the basis of the national objectives for the various forms
of education as well as the authorities’ responsibilities.
The government thus issued a broad-based mandate for the regions to
work on skills supply, although it came with no resources or instruments of power, which meant that Region Skåne and the country’s
other regions were faced with a classic dilemma of regional development work: How do we encourage other players to collaborate,
when we can neither contribute any financial resources nor order
them to collaborate?
Multi-level governance in practice
There are several problems that can be identified in the commission to establish regional skills platforms.
The educational system
It is not the undertaking of most education providers to educate
to meet the labour market’s needs. The dimensioning and funding
of educational programmes in Sweden are governed primarily by
the free choices of students. The Swedish Schools Act states that in
the case of upper secondary education, “The courses offered and
the number of places on them shall be adapted as far as possible
to the preferences of the students”. Institutes of higher education
must consider both the labour markets’ and the students’ demand
for courses, although appropriations are governed primarily by the
students’ choices and the obligation to deliver courses of an acceptable quality to maintain their licences. Only the National Agency for
Higher Vocational Education has a specific undertaking to educate
to meet the labour market’s needs. There are also the courses arranged by the Public Employment Service and the municipalities’
vocational courses for adults at upper secondary level, but with no
strong coupling to the labour market of the future.
The diversity of education providers further increases the complexity of the education system. Compulsory schools, upper secondary
schools and adult education are the responsibility of municipalities,
and with a relatively free right for private providers to establish such
facilities. Institutes of higher education and the National Agency for
Higher Vocational Education are the responsibility of the national
government. As the municipalities, in their role as education providers, are competing with private providers, there is some conflict of
interest between the municipality’s role as the body responsible for
municipal educational planning and as the authority responsible for
compulsory and upper secondary schools.
Regional responsibility for the education system is limited, beyond the fact that the county council and the self-governing body
have a direct responsibility for arranging work placements in the
healthcare sector for healthcare courses. From a governance perspective, the fact that the regions have no operational responsibility
for the education system might be an advantage in this case, as the
region can assume a neutral role and create arenas for collaboration
without running the risk of being accused of promoting its own
special interests within the skilled labour platform.
It should be noted that the administrative region is not always a
functional region for education systems. Not all the different fields
of education fall within one region. Even a large county such as
Skåne is dependent on the education system in other regions and also
provides education for labour markets other than its own, especially
considering that we are close to the Copenhagen metropolitan area
in Denmark. There is therefore a need for vertical collaboration
between local, regional and national levels, as well as horizontal
collaboration between municipalities and regions, and across the
border through the Öresund collaboration.
Labour market demand
Skills supply is all about matching a range of courses with the
labour market’s demand for various qualifications. In this context,
skills supply means both activities in the education system, and skills
development (vocational courses, etc.) for those already in work.
There is, however, no obvious representative of the “labour market’s”
interests. None of the trade and industry organisations have a clear
view of the regional economy’s skills requirements, least of all in
the long term. The Public Employment Service produces forecasts at
county level, but these are short-term and do not quantify demand at
vocational level, but simply apply vague categories such as “serious
shortage/surplus”, etc. This means that the Public Employment Service’s forecasts serve as a good signalling system for relatively short
courses, but are of limited significance for educational planning at
compulsory school, upper secondary school and in higher education,
where it can be decades before a pupil at compulsory school leaves
the education system to find a place in the labour market.
The long-term forecasts for the future labour market that do exist deal with the country as one single labour market, which means
they are of limited value for the production of regional education
plans, not least because mobility among graduates is relatively low.
According to a study conducted by Uppsala University for Region
Skåne, most students who graduate from seats of learning in Skåne
remain in the region after graduation. Arguments in favour of treat92
ing the whole of Sweden as one single labour market are thus weak
even when it comes to higher education.
Skåne’s challenges in the area of skills supply
As described above, there are large numbers of players in the
skills supply system. It is more or less possible to identify the important players in the education system in the form of, among others,
institutes of higher education, municipalities and large education
companies. It is much more difficult to build up an overall picture
of demand, as the parties involved there are essentially all companies
and organisations that need personnel. Companies’ views of which
competences are required are often difficult to link to actual courses,
and needs vary radically between different companies, even within
the same industry. Education systems are often relatively stable,
while companies’ demand changes quickly, depending on the state
of the economy and changes in their competitive ability. As previously confirmed, the education system is strongly oriented to meeting
student demand, while the labour market’s needs have no significant
steering effect on areas of study. This problem is reinforced by the
fact that it is complicated to create distinct signalling systems for
potential students to help them to choose their course.
When Region Skåne was commissioned to establish the regional
skills platform, there were thus a number of challenges:
• There were no resources allocated from the State for this platform.
•There were no specific control instruments.
• The education system is in itself fragmented and run by authorities
that compete for students.
• There is no clear picture of the labour market’s long-term demand.
Start-up meeting
A start-up meeting for the Skills Platform was held in 2010. Attending the meeting were representatives of municipalities, institutes
of higher education, the Public Employment Service and parties
from the labour market. The primary outcome of the meeting was
that it gave Region Skåne a mandate to continue working on these
issues. One strategically important outcome was that the meeting
supported the decision not to create a partnership to represent the
skills platform. This was partly the result of experiences from other
regional processes that tended to be extremely cumbersome organisationally. Region Skåne was given a free mandate to proceed and
set up the platform at the public official level. This meant that the
focus could be directed towards building up a knowledge base and
drawing up actual proposed measures aimed at the area of skills
supply. A number of existing activities could quickly be linked in to
work on the skills platform.
Prioritise – but how?
It was discovered at an early stage of work on the skills platform
that there was no key data on which to base work on issues surrounding skills supply. There was no coherent picture of supply and
demand in various educational groups. At the same time this was
the specific knowledge that was needed, partly as the country’s skills
platforms were asked to comment on applications to the National
Agency for Higher Vocational Education and to state whether these
applications were in line with demand from the labour market. Signals
also came from trade and industry about the need for qualifications
and shortages in certain personnel categories, although these signals
were not unambiguous. Corresponding signals also came from study
and careers advisors from the Public Employment Service – the forecasts produced were either short-term or simple descriptions of the
current status, which was not much help to the education system.
Very quickly, attention shifted to Statistics Sweden’s report entitled “Trends and Forecasts”, which is a gap analysis at national
level looking about two decades into the future, relating demand for
over one hundred educational groups to the supply of labour using
these various qualifications. Discussions with Stockholm County
Administrative Board and Region Västra Götaland resulted in the
notion of commissioning Statistics Sweden to break down “Trends
and Forecasts” by region. This resulted in a joint project between
the metropolitan regions, which turned into a commission to draw
up an education and labour market forecast for each region, but
based on a joint model. The forecast horizon was set at 2020. The
project itself was something of a risk, as nothing like this had ever
been done in Sweden and the cost was relatively high. A total of SEK
4.5 million was invested by the metropolitan regions, with Region
Skåne contributing approx. SEK 1 million. Work started in autumn
2010, and for Skåne’s part it resulted in a conference in Malmö on
18 January 2012 at which the report was presented to just over 100
visitors. The conference gave it a positive reception.
Increasing interest
Discussions had been held with external parties in the form of
the Public Employment Service and the Skåne Association of Local
Authorities about the feasibility of drawing up an education and
labour market forecast, but the interest of the world at large had
been seriously underestimated. Following the initial presentations
in January, a large number of external enquiries started to come in.
During the spring, Region Skåne was invited to present the forecast
to external parties on 34 different occasions. Interest remained high
after the summer. Between 2012 and 2013, more than 2,000 people
were involved in more than 60 different presentations, and more
than two thousand reports were distributed.
Analysis as a creator of networks
Before the analysis was conducted, it was assumed that there was
a need for background knowledge in order to work on issues relating
to skills supply, but it became clear that work on the analysis relating
to skills supply also proved to be the most important door-opener
for Region Skåne when it came to setting up collaboration with external players. Players in the skills supply system, including institutes
of education, industry representatives, labour market parties, etc.,
generally lacked instruments for long-term work on issues relating to
skills supply, which meant that they urgently needed Region Skåne’s
forecast. Thanks to the forecast, work could be targeted at specific
challenges in the field of skills supply. Based on the forecast and other
analytical work, the following partnerships emerged:
• Collaboration with “Teknikcollege” (an organisation for collaboration and quality assurance of industrial courses) on the shortage
of industrial workers. Region Skåne provided support in the form
of an in-depth analysis of, among others, welders and machine
operators. This work also resulted in extended contacts between
Region Skåne and the employers’ association Teknikföretagen.
• Extended collaboration with the healthcare sector. It was confirmed
here that the forecast represented a good basis, but an extended
partnership was initiated in order to be able to develop more
refined forecasting models that can be broken down into more
specification educational groups and also to integrate qualitative
elements in the form of expected effects of technical and organisational development.
• Collaboration with institutions of higher education. Region Skåne
became an attractive collaborative partner for, among others, Lund
University Faculty of Engineering and the universities in Kristianstad
and Malmö, as the forecast arrived at a time when the number of
higher education places will be cut. There is therefore a need for
base data in order to justify which courses can be reduced or to
put forward arguments to retain education grants.
•Collaboration with the Public Employment Service. The forecast
made a big impact on the Public Employment Service, and it has
been presented to study and careers advisors on numerous occasions.
•Collaboration with Skåne’s Higher Vocational Education (HVE)
network on base data to prove the need for courses under the
auspices of HVE.
•Collaboration with the Skåne Association of Local Authorities
on future courses for study and careers advisors, based on the
education and labour market forecast as well as plans for a future
regional forecast of teachers.
Organisation or solution-oriented work?
Development work in recent decades has focused strongly on
governance and institutions. In practice, this has meant that the
main focus has often been directed at organisational issues. Work
has started with the formation of partnerships, and only then moved
on to discuss the actual issues at hand.
Partnerships have often been formed to cover a wide diversity of
different perspectives, with representatives from numerous industries,
labour market parties and representatives of horizontal perspectives
in the form of the environment, equal opportunity, integration, etc.
One example of this work method was the work by the regions on
the Regional Growth Programme (RGP) that started in 2004. To
cover all of the perspectives listed by the government in its mandate,
a partnership of more than thirty members was created in Skåne. In
practice, the partnership proved to be of limited importance. The scale
and breadth of the partnership meant that few issues engaged more
than a small proportion of the partnership. This meant that it was
difficult to recruit members of the partnership at a high level, they
often came from lower levels within the organisations represented in
the partnership. The partnership often suffered from a poor degree
of acceptance in the organisations involved.
With due reference to the experiences from the RGP process, a
different approach was chosen for work on the Skills Platform. Instead of starting by building up an organisation, a decision was made
that work should focus on defining a number of important issues on
which to work with the aid of forecasts, analyses and contacts with
the world at large. These issues would then be channelled towards
existing organisations or, if there was none, workgroups would be
set up to deal with these relatively specific issues. This avoided the
problem of big partnerships. It also meant that Region Skåne’s intervention in the area of skills supply was perceived as less threatening
by other organisations. As the focus was directed at problems and
not organisations and governance, territorial battles were avoided.
Thanks to this setup, the signal sent out was that Region Skåne had
no intention of seizing power in the area of skills supply, but that in
collaboration with other players it was developing analyses of and
solutions to problems in this area. This clear signal about Region
Skåne’s ambitions made work on issues relating to skills supply much
easier. At the same time, it meant that most of the work emerged at
public official level, which, as the work increased, became a problem
because of the low level of acceptance at the political level.
An organisation emerges
The Skills Platform’s activities had grown during 2011 and 2012
to such an extent that a realisation emerged that some kind of organisation was needed to secure its work. The previously mentioned
experiences of work with broad-based partnerships meant that the
focus was directed at creating a small, focused steering group. The
Regional Skills Council was used as a basis for this work, a body
that had been formed towards the end of the 1990s when the Public
Employment Service’s work was still organised on a regional basis.
However, it now had no resources for a secretariat and was leading
a relatively quiet existence. The Skills Council was chaired by the
County Governor, while the commission to set up skills platforms
had been given to Region Skåne. This was organisationally confusing
and contained the seeds of territorial battles between the different
organisations at regional level. This problem was solved by coordinating the Skills Council with the Skills Platform, which took place
formally by discontinuing the Skills Council, with its full agreement,
and reforming it under the name of Skills Partnership Skåne, with a
slightly different emphasis than before and with a clearer focus on
specific work in working groups. The chair of the steering group
became the chair of Region Skåne’s Regional Growth Board.
The steering group consists of a small core of public organisations
with responsibility for education and the labour market: Region
Skåne, the Public Employment Service, the Skåne Association of
Local Authorities, Lärosäten Syd (collaborative organisation for
institutes of higher education in Skåne and Blekinge) and the County
Administrative Board, which is responsible for issues of equality and
integration as well as governmental coordination. Region Skåne
holds the position of Chair. A secretariat and an analysis group have
been assigned to the organisation. A number of working groups
have also been formed, of a more or less temporary nature, to deal
with practical collaboration. The organisation may be viewed to a
large extent as a formalisation of the collaboration that emerged
from practical work on issues relating to skills supply. The working
groups, which form the core of the work, focus specifically on the
challenges highlighted in the forecast.
In order to involve and engage more players in this work, a larger
network has also been formed in the form of a Skills Forum, which
is a more informal network, and the intention is that it will meet
a few times a year to share information and provide input into the
work of the Skills Partnerships
Has this approach to the Skills platform commission been a success?
From Region Skåne’s perspective, it can be confirmed that the
role of its own organisation has been enhanced significantly. When
work on issues relating to skills supply started in 2009, Region Skåne
essentially had no role to play in the area of skills supply. In 2014,
Region Skåne is a party with a high degree of legitimacy among
external players. Region Skåne’s strategy of gaining influence by
building up a unique knowledge base at a regional level by means
of analytical work has meant that the organisation has something to
give other parties, as proven by, among other things, the large number of invitations to external presentations and discussions. Region
Skåne has also taken its place in working groups dealing with the
dimensioning and future activities of institutes of higher education.
The strategy of “soft” governance through analyses has meant that
it was possible to push into the background any disputes about who
holds the formal mandate within the various areas.
What problems remain?
There are at present partnerships and trust between the players
in the education systems, labour market policy and industry representatives. But the major problem remains: there are essentially no
control instruments or financial incentives to dimension the education
system to meet the labour market’s needs. On the whole, it is students
themselves who control this dimensioning through their educational
choices, at both upper secondary and higher education levels. The
situation is even more difficult for skills development among those
already in work. Region Skåne’s analyses have revealed that educational levels within most industries outside the Malmö/Lund region
are relatively low, industry for industry, compared with educational
levels throughout the rest of Sweden. This cannot be changed in
the short or the long term via the formal education systems, quite
simply because most people who are in work will still be there even
after a decade with the same educational level as they have today.
A change in educational levels that only takes place through people
retiring and replacing them with newly educated people from below
will, by necessity, take time. With the exception of initiatives within
the framework of the European Social Fund, there are essentially
no instruments to stimulate skills development at the workplace.
The weak incentives to adapt the dimensioning of education
to meet the labour market’s needs and the lack of instruments to
promote skills development among those in work cannot, however,
be resolved at a regional level, but require measures at a national
level. Work within the Regional Skills Platforms in Sweden has primarily involved building collaboration between parties at local and
regional level, but if it is going to be possible to solve the structural
problems, stronger collaboration is required between the regional
level and the national level.
Lessons for the future
Experiences show us that it is difficult to create regional collaboration. Work often starts with the creation of an organisation and a
focus on how action is to be taken rather with what is to be done.
Work to achieve acceptance does not therefore start with a question
of which initiative are required, but becomes a question of who has
the trust and a mandate to take charge of the processes. This brings
with it a major risk of territorial disputes between different organisations. It is sometimes confirmed, rather cynically, that “everyone
wants to coordinate, but no one wants to be coordinated”.
Experiences of work on the Skills Platform in Skåne indicate another
way, in which work starts with making use of careful analytical work
to encourage the outside world to agree on a joint view of the problem.
If the parties involved agree on what needs to be done, it is much easier
to build a functional organisation to deal with these problems. The
question of formal mandates and governance becomes less important
if the parties involved are working towards a common objective.
However, this way of working places great demands on the analytical work, which must take place in interaction with the outside
world and must move from an overarching, strategic level towards a
more practical, almost operational, level. The challenges are seldom
found in the overarching problems, but in producing actual results
that can be used in an operational context. Analytical work within the
skills platform commission was thus not about confirming that there
is a risk of shortages in healthcare and nursing personnel or those
with industrial qualifications, but about confirming in concrete terms
that there is a shortage of certain specialist nurses and doctors, and
of welders specialising in advanced techniques on expensive materials. Only when the analysis reaches this level of detail is it possible
to find the right players and form functional collaborative groups.
This also involves another challenge. For the analyses to be sufficiently practical to be operationally usable, expert competence is
required combined with a dialogue with the operational level. At the
same time, the prevailing paradigm in development policy has been
an emphasis on network competence and on shifting the work from
“downpipes to gutters”. There are of course often good reasons for
greater collaboration, but at the same time there is a risk that the
focus is directed at the process and not the content, and that the
number of experts falls while the number of project managers with
general competence rises.
The risk of starting work by setting the top priority of gathering
players is that you create dysfunctional organisations that are not
suitable for handling the challenges, which are only identified in a later
phase. Experiences of Skåne’s work on the Skills Platform indicate
that a more qualified discussion is needed on balancing specialist
competence against generalist competence, and building up collaboration on the basis of confirmed needs and not on the starting point
that it is an objective in itself to move from “downpipes to gutters”.
Regions as gap fillers: Building a cluster commons
During the last two decades, policymakers around the world have
initiated programs to enhance innovation, and to support cluster
formation, growth and competitive dynamics. We have worked in this
field for many years, and have come across numerous examples of such
regional, national and international economic development policies.
This chapter is about conscious acts of what we label “building the
cluster commons”. Large and small firms, education and research
institutions, and other types of private and public organizations
carry out these acts together. They are actors that are prepared to
invest time and money into building more dynamic and innovative
clusters. They do this by constructing a commons where actors meet
and exchange ideas, and by initiating cooperative projects across
actor boundaries. As we will soon explain in more detail, one can
think of this commons as the “white space” in between the actors.
This chapter will take a deeper look at how the region can initiate
and play a vital role in supporting cluster organization in becoming
powerful builders of cluster commons.
The Cluster Commons
The late Nobel laureate Elinor Ostrom has written several influential works on the theme of collective action, and governing the
commons (Ostrom, 1990). To her it was about governing a commons that was already in place, such as a water reservoir, a fishing
ground or a mountain meadow. Furthermore, she was interested
in individuals making use of such common-pool resources (CPRs).
The cluster commons, as we see it, has many similarities to Ostrom’s
writings. However, we do not talk about an existing commons, but
something that under certain circumstances is constructed (even if
entrants in later periods might see cluster resources and relationships as something already existing, and offering public goods).
And, furthermore we are not only interested in how individuals use
the commons, but also how firms and other organizations connect
and collaborate. However, to the point that the governance of the
commons has many solutions, and that it must not be governed from
the outside, we are on the same track.
Ostrom (1990) writes that neither the state nor the market is
uniformly successful in enabling individuals to sustain long-term
productive use of the commons. Here we agree; there are many
collective solutions to construct a cluster commons. Such initiatives can come from the outside (e.g. from a regional economic
development program) and from the inside (e.g. from an initiative
by some corporate leaders). As is well described by Ostrom, we
also see the problems of free riders, and the risk of the “tragedy
of the commons” depending on the circumstances. Why would
firms invest in building a commons that can be used by others who
are not pitching in? At first sight they would not, but as we will
argue there are many actors prepared to invest time and money
in the commons, if supported by good territorial governance i.e
active regions.
Cluster organizations have become commonplace (for surveys see
Sölvell, Ketels & Lindqvist, 2003; Ketels, Lindqvist & Sölvell, 2012).
Beginning in the 1990s clusters emerged as one of the central tools
within regional, industrial and innovation policy, sometimes referred
to as cluster policy (Jacobs & de Man, 1996; Raines, 2001; Swann,
2006; Ketels & Memedovic, 2008). Inspiration came from work on
regional innovation systems (Cook, 2002; Asheim & Gertler, 2003),
the learning region (Morgan, 1997), knowledge spillovers (Audretsch
& Feldman, 1996), and most importantly Michael Porter´s work on
clusters and competitiveness (Porter, 1990). Critics are also abound
(Martin & Sunley, 2003; Asheim et al, 2006; Duranton, 2011).
Clusters are typically seen as a collective set of actors; firms,
research institutions, educational institutions, capital providers,
public organizations and so on. In addition to actors, there is also
“white space” in between, just like a meadow close to a group of
farmers. The question is whether this meadow will be accessible at
all, or full of dirt and big holes; or, if it will offer green grass for the
cluster to thrive on? Some meadows offer very little in terms of CPRs,
whereas others are very attractive for grazing. In order for a cluster
to be blessed by a meadow with fresh grass, it has to be constructed
by the different actors in the cluster. Some organizations, i.e. cluster
organizations, are even set up as meta-organizations with the sole
purpose of building the commons.
Cluster policies tend to have a focus on interaction and collaboration (Rosenfeld, 1996, 1997), by constructing frameworks for
localized networks (Morgan & Nauwelaers, 1999). Thus, it is not
directed to firms directly, as traditional industry policy, but towards
how firms interact, with other firms and with other actors on the
cluster stage. As Diez (2001) puts it: “rather than an innovation
policy for companies, it is a question of an innovation policy with
companies”. So how should we envision the grass on the commons?
We think it is fair to say that the common-pool resources we try to
catch consist of at least four things:
•some level of trust which allows for exchange of ideas and collaboration
•some level of common identity stimulating construction and use
of the commons
• some type of structure facilitating meetings and networking – these
can be seen as paths and bridges linking the various actors
• some level of continuous traffic constituting the ground for crossborder networking and collaborative projects (between firms, between firms and the research community etc.), where new ideas,
concepts, product, processes and services are being tried, tested
and developed, i.e. what we refer to as the process of taking seeds
of innovation to full fruition.
There is often a suspicion, especially among economists, against
the role of collaboration in society. Should not firms compete? Of
course they should, but as we see it we have two fundamental, and
complementary, types of exchange mechanisms in society: the market and the cluster commons. If the marketplace is the place where
buyers and sellers meet, with competition as the key mechanism, the
cluster commons is the place where cluster actors meet, with cooperation as the main mechanism. And whereas markets have rapidly
become more global in character, proximity is still fundamental to
the functioning of the commons. Firms and other organizations have
to live in both worlds.
In earlier studies we have pointed to the “seven innovation gaps
of clusters” (Sölvell & Lindqvist, 2011) limiting mobility, interaction
and collaboration. One answer in many parts of the world has been
to organize cluster activities. Thus, cluster organizations constitute
a particular type of actor on the cluster commons. So what do they
do? And do they deliver measurable results in term of paths, bridges
and fresh grass of value to cluster firms?
What cluster organizations do
Cluster organizations around the world come in many shapes
and forms. They differ in the way they are organized and governed
(some have explicit members whereas others work with different sets
of firms and organizations depending on the project), the way they
are financed (various combinations of public and private funding),
and what activities and services they provide (see Sölvell, Lindqvist
and Ketels, 2003, for an overview). Some activities are more oriented
towards building the fundamentals of the cluster commons, whereas
other activities and services are geared directly towards connecting
firms and other actors, e.g. initiating joint innovation projects. Such
collaboration can be divided into two fundamental types: projects
with an innovation focus, and projects with a business development
focus (see Figure 1). All the three areas interact and overlap.
Figure 1. Three Types of Activities Performed by Cluster Organizations
Cluster Commons
Identity building and trust
Vision and strategy for cluster
General cluster networking
Regional and cluster branding
Innovation and R&D
Business development
Bridging innovation gaps
(lobbying, HR upgrading,
incubators etc.)
New products and processes
Market intelligence
Commercial cooperation
Trade fairs
Internationalisation and
export promotion
Hence, we argue that cluster organizations rest on three pillars of
activities. The first is about overall cluster identity and attractiveness.
Here the cluster organization is deeply involved in building a sense
of belonging and identity, general trust and networking; in short,
building a commons. The second pillar relates more directly to R&D
and concrete innovation projects, where the cluster organization
helps build bridges and stimulate traffic across the innovation gaps.
Bridging to public organizations can lead to improved regulation
and redirection of public investments. Bridging to research can involve incubator services and commercialization of research results,
and bridging to education can improve HR supply and upgrading
inside the cluster. The third pillar involves business development
among member firms. Typical objectives and activities include export
promotion/ internationalization, joint trade fairs, joint purchasing
and other commercial cooperation, often between SMEs not large
enough to carry out these activities on their own.
Clusters play a critical role in innovation processes among firms
(Furman, Porter & Stern, 2002). To understand why, we must see the
cluster as a collection of different types of actors (Sölvell & Lindqvist,
2011). The most important is the firm. It is firms, and individual
entrepreneurs, that take innovations to markets and subject them
to the test of competition. Another type of actor includes research
organizations, which produce new advanced knowledge. A third
type is education organizations, such as schools and polytechnics.
Universities are a special case, because they play the double role of
being both research and education institutions. A fourth type is the
capital providers, such as angel networks, venture capitalist and
banks, who provide the financial resources needed for the exploitation of inventions and new business models. And, fifth, government
and public bodies are actors that make and implement policy decisions about public infrastructure investment, regulations, cluster
programs and so on, which is critical for the innovation climate. The
public side includes many levels of government and a wide range
of public agencies.
The reason clusters are relevant for innovation is that when there
is a critical mass in a location of a sector or industry, the different
actors can support each other, and new ideas are formed in both
planned and unplanned meetings and interactions. Through interaction within the cluster, conditions are more likely to emerge that are
adapted to the needs of the firms, and that are conducive to innovation. Universities set up research groups that produce cutting-edge
knowledge in relevant fields, and channel those findings to firms in
the cluster or lead to spin-offs. Colleges offer specialized education
programs and graduate students with skills particularly suited for
working in the cluster. Capital providers become experts in technologies and skills related to the cluster, and they can provide “smart
money” by being better at assessing risks and opportunities in the
cluster. Local government and public agencies learn to understand
the needs of the firms, and make decisions that promote the cluster,
and removes obstacles to progress. In all these ways surrounding
actors support firms and entrepreneurs, and make it easier for them
to be innovative and competitive. Also, not least important, firms
interact with other firms. Small firms interact with large firms; domestic firms interact with multinationals and so on. They engage
with each other as buyers, suppliers, and technology partners, but
competing firms also attract staff from each other, they imitate each
other at a fast rate, and firms in the surrounding cluster simply act
as a source of inspiration to aim higher in competition, and to set
more ambitious goals.
Participation, engagement and ownership
There are five main types of actors on the cluster stage, and between them there are paths along which actors can interact with one
another. One path, or perhaps rather one set of paths, runs between
research organizations and firms, another between government and
firms, and so on. In an ideal cluster these paths are busy with traffic. People change jobs between actors, network across boundaries,
bring news to others in formal and informal gatherings, discuss with
others, and tie the cluster together in a thousand different ways. All
this traffic helps make the cluster more dynamic. Knowledge is created, spread and shared. Collaboration ensures that resources are
used in the best possible way. Coordination aligns the interests and
actions of different agents.
Of course, this definition shows a cluster commons in an ideal
way. It is the kind of cluster everyone wants. Unfortunately, in reality
most clusters don’t look like this at all. In real clusters, communication between different kinds of actors is massively flawed. Small
firms who believe they have something new exciting to offer have
a hard time even to be allowed to meet with the right people at a
large enterprise. Large firms searching for a new supplier are more
likely to look for an established international supplier, than to go
searching among innovative SMEs located right under their nose.
Policy makers often have only vague ideas about what business really needs. Researchers are more interested in academic publishing
than commercializing their new findings. Schools formulate their
curricula with little knowledge of what skills industry really needs.
Entrepreneurs find it difficult to persuade banks to invest in new
innovative businesses. Many business people, particularly in SMEs,
would laugh at the idea to approach the local university to see if they
have some skill or new technology they could use. In some cases a
robust commons has never been built and in other cases in has been
ruined through the “tragedy of the commons” where everyone is
utilizing it, but no one is prepared to invest in it.
It is not difficult to understand that these connections will not
just happen spontaneously. After all, the different types of actors
have different roles to play in society. Universities are supposed to
do research, not to serve as R&D departments of companies. Policy
makers have responsibilities that go far beyond serving companies
with whatever they require. Education organizations have many
other stakeholders than firms to oblige. And firms are in business
to make a profit for themselves, not to provide altruistic support to
each other. Even so, with some additional effort put into coordination and collaboration, large benefits could be reaped, which now
remain neglected.
In other words, more often than not, clusters in reality do not
live up to the potential that cluster theory grants them. Clusters possess tremendous potential, but in many cases, this potential remains
largely untapped. At first, these immense missed opportunities may
seem hard to accept. If the world is a place that is constantly moving
towards an ideal equilibrium, i.e. a state of efficiently used resources,
it seems unlikely that these kind of gross misalignments could endure.
After all, why would clusters not make the best possible use of the
potential they enjoy? Why should these possible benefits remain
untapped, when all that is needed is a little interaction?
The answer lies in the fact that interaction between agents is not
such an easy thing to do. If all it would take were a simple phone
call from one person to another, then clusters would surely be a lot
more efficient. But in reality, there are a thousand reasons why that
phone call never takes place. The policy maker doesn’t pick up the
phone, because she doesn’t expect to hear any deeper insights from
the industry of what they really need. If the college teacher talks to
the business world, it is about finding placement positions for the
students or arranging recruitment fairs, but certainly not to discuss
the curriculum. The businessman has no idea what the researchers
at the university are doing, he probably doesn’t know their names
and he certainly doesn’t know within what departments they are
organized in. The researcher might want to see her latest discovery
turned into a successful commercial innovation, but she knows
that her career depends on publishing papers, and it will in no way
be furthered by interacting with business people; in fact, it will be
hampered. And if, by chance, the businessman and researcher would
meet and discuss each other’s work, they would soon find that they
speak different languages and have different mindsets, almost as if
they were living in different worlds.
What this all means is that there are obstacles to interaction,
such as lack of trust or limited knowledge across actor boundaries.
Obstacles make it difficult for actors to communicate with each
other, to initiate collaboration, and to diffuse knowledge. It is like
obstacles like not being aware of the other actors’ reality, and lack
of incentives that prevent the research world to spread its new
knowledge to the business world, and that stop policy makers from
seeking advice from business people. Obstacles make traffic slow and
awkward where it preferably should be rapid and easy. Obstacles
isolate systems when they should be connected. In short, obstacles
create gaps where there should be paths. The picture of the cluster
that we sketched above, with its wide paths and its intense traffic is
not what we often see. Real life clusters have obstacles, much like
the rivers and streams that a path has to cross.
These gaps, which are quite persistent, have great implications
for innovation and competitiveness. It means that clusters despite
their great potential for dynamic interaction between actors, often
only exploits a small share of this potential. People do not make the
most of the possibilities found around them, because they simply
lack knowledge about what opportunity is nearby, they lack the
networks to utilize it, they fail to initiate collaboration they would
benefit from, and they fail to coordinate their actions with others.
In short, people and organizations lack a commons. Without a lush
commons, clusters will suffer from knowledge failures, network
failures and cooperation failures, leading to innovation failures.
Where the Region comes in
The most usual gaps inside the clusters that we have identified
during the last decade are the following:
•The research gap barring interaction between firms and research
•The education gap barring interaction between firms and education organizations
•The capital gap barring interaction between firms and education
• The government gap barring interaction between firms and public
• The firm-to-firm gap barring interaction among firms in the cluster
In addition there are two more gaps, external to the cluster, which
are critical to cluster dynamics:
• The cross-cluster gap barring interaction with firms in other clusters
•The global market gap barring interaction with global markets
Public support can help to correct for knowledge failures, networking
failures and cooperation failures, and this is where cluster organizations come into the picture. Cluster organizations, financed through
both public and private means, can bring different types of actors
together and correct for some of the failures. They connect business with academia, education with industry, and large firms with
small firms. They do this by providing activities and meeting places
where common issues can be discussed and acted on jointly. They
help the different actors overcome the obstacles and start talking to
each other. In doing so, they get the traffic moving along the paths.
One could say that a critical mission for cluster organizations is
to build bridges (meeting places, forums, platforms) across the seven
cluster gaps, and support traffic (meetings, innovation projects) on
those bridges. It can do this more easily if it is not controlled by one
type of actor. In that way, the gaps can be bridged and all actors
can be attracted to invest in the commons, as the cluster organization does not “belong” to any particular actor only guarding their
own interests.
But are there any real effects from these public-private clusters?
As we mentioned above, in North Mid Sweden, one of eight EUdenominated regions in Sweden, regional programs have focused on
innovation activities in clusters, ranging from process industries, such
as forestry, paper and steel, to tourism and ICT. These programs have
introduced organized clusters to stimulate inter-firm collaboration,
and linking firms with research institutions (through incubators,
test beds etc.), education institutions (through specialized education
programs, new PhD schools etc.), and other important cluster actors.
In order to evaluate the effects from cluster initiatives, we have
developed an evaluation model based on three mutually reinforcing
methods. Our goal is to measure both intermediary effects and final
effects on firms participating in cluster activities. The intermediate
effects cover different cluster gaps, hindering effective mobility and
collaboration inside clusters, and also between clusters and the outside
world. We measure performance related to six gaps:
• The degree to which cluster activities improve inter-firm collaboration (Firm-to-Firm)
• The degree to which cluster activities improve collaboration between
firms and universities (Firm-to-Research and Firm-to-Education)
•The degree to which cluster activities improve collaboration between firms and capital providers (Firm-to-Capital)
•The degree to which cluster activities improve collaboration between firms and public actors (Firm-to-Policy)
•The degree to which cluster activities improve collaboration between firms and actors in related clusters (Firm-to-Cluster)
•The degree to which cluster activities improve collaboration in
international markets (Firm-to-Global)
We also measure final effects on firms participating in cluster activities. This is done through two methods. The first one is based on
official accounting data for firms. Through the SIMPLER method
we can measure firms’ performance compared to the overall regional
performance of all businesses, and compared to a selected control
group of firms in the same industries (not taking part in cluster
activities). The financial performance of all member firms (formal
and informal membership in cluster activities) is accumulated into
“cluster performance”. In total we measure 4 variables:
• Competitiveness (efficiency measure which is compared to an overall
Swedish baseline for cost of capital)
•Value added growth
•Profitability growth as a percentage of value added
•Wage increase per employee
A second method to measure direct effects on firms is based on
survey data from managers of member firms. Here, they are asked
to assess the impact stemming from work carried out through their
cluster organization. In total we measure 6 variables related to the
general performance of firms:
•New or better products and services
•Workplace equality
•Workplace diversity
If we take a look at the evaluation data over the period, we can
conclude that cluster organizations contribute mostly to sales and
innovation through new and improved products and services. The
effect on employment, increased equality, workplace diversity and
environmental sustainability is substantially smaller, but has grown
in the recent years. But now let´s turn to the evaluation model with
its different components. Building the cluster commons involves
relentless work, and we should always expect free riders. To avoid
the tragedy of the commons, many actors must be involved in the
construction work, and cluster organizations play a very particular
role in this endeavour. In our research we have now tried to measure real impact from such work. The test has been to look both
at the building of bridges (as experienced by cluster firms), and the
performance of firms that involve themselves in cluster activities.
Do they perform better over time as a result from this work and are
there any bridges built?
The simple answer is yes, but clearly some cluster organizations
do it better than others. Data for this report cover the period 2005
– 2012, a period long enough to trace real results from the cluster
programs. Over 30,000 employees in some 1,000 firms (2012) gather
into 12 organized clusters, see Table 1.
Table 1. Cluster Organizations in North Mid Sweden
Cluster Organization
Start Year
Paper Province
Paper products
Fiber Optic Valley
Fiber optics
Triple Steelix
Future position X
Geographical positioning
ITS Dalarna
IT for logistics
High Voltage Valley
High voltage technology
The Packaging Arena
Stål och Verkstad
Engineering and machinery
Prefab wooden homes
Destination Dalarna
Industrial IT
In addition to private industry, including buyers, suppliers, service
providers, and consultants, a wide range of related organizations, and
three regional universities, also play important roles within the clusters.
Compared to control groups, only one out of 12 clusters performed worse than the peer group in terms of value added growth.
For profitability and wage increase per employee, only two out of
12 clusters performed below the control groups.
Getting good results
By using three complementary evaluation methods, we have been
able to trace results for over one thousand firms engaging in cluster
activities. Some organized clusters clearly perform better than others
on almost all accounts, and one must ask why? Probably there are
differences in the underlying cluster strength – where “the stronger
the cluster, the easier to arrange for cluster networking and innovation projects”. There are probably also other explanations, such as
differences in cluster management quality, differences in support
from local and regional government and so on. However, we think
that one of the most pervasive factors is that of age and financial
strength. Older clusters have built more muscles and deliver real results to member firms, whereas the younger and more thinly financed
clusters struggle to make any noticeable impact. Some of the new
cluster initiatives will never get off the ground and should disappear
out of our sample, but at least they should first get a chance to show
that they are capable of creating lasting results. Therefore, local and
regional public actors should not spread their resources too thin,
spending money on everything resembling a cluster fragment. Instead,
they must offer enough financial resources, and other types of support, for the chosen organized clusters to takeoff. Results show large
differences in performance among clusters across the three regions,
leaving room for continued benchmarking and cross-cluster learning.
Recently established cluster organizations throughout the three
regions are almost wholly funded through public means. Over time
clusters should be able to reach a more balanced financial situation,
with a public part of around 50% - 60%, in line with international
benchmarks. Private financial sources can include memberships,
project co-funding and service fees. Top-down public initiatives
should be met by bottom-up private initiative and company involvement; otherwise the initiative will never gain legitimacy, or lead to
improved innovation performance within the cluster.
In general, cluster organizations have made a difference when
it comes to bridging innovation gaps, particularly the inter-firm
gap. The innovation gaps were decreasing until the 2009 crisis hit,
but there are worrying signs of increasing gaps again, for example
the Firm-to-Research gap. Gaps to capital providers have not been
attended to. Among the group of 12 clusters, almost all perform
financially better than their control groups. And, it is interesting
to note that financial performance seems to go hand in hand with
the innovation gap performance and general firm performance as
measured through surveys.
Moving over to the role of cluster organizations, we want to
point to the fact that these organizations are newcomers on the
regional scene, with the clear purpose of building cluster commons,
and to strengthen innovation cooperation. Thus, they can be seen
as a complementary policy instrument to science parks, incubators
and other bridge builders.
Some cluster organizations are active in high tech areas (e.g. IT,
geographical positioning systems), whereas others are in more traditional industries (paper products and prefab homes). Some have
a stronger service focus (tourism). Thus, cluster organizations can
facilitate rejuvenation of traditional sectors, but also help in building
emerging sectors in a region. The need for increased cluster dynamics
is as important in emerging industries as in mature industries. Firms
in all clusters can, if they innovate and upgrade their competitive
advantages, compete in international markets.
Interview data confirms observations from the survey and
SIMPLER. However, a couple of interesting effects emerged from
the data. For example, in several cases the large impact from the
organized cluster work did not materialize in the target area (e.g.
enhancing joint innovation projects), but in other areas (e.g. reaching international markets). In other cases firms expected that joint
cluster activities would lead to contacts with other firms, but in effect
led to contacts with university research and students, or got them
involved in policy dialogues that they had never accessed before.
The organized clusters have, through their many activities, helped
to make the clusters more visible in their region, particularly to policymakers. The more mature clusters tend to have formal membership
and the financing is more varied. More recently established cluster
organizations typically rely on public financing. Also, as expected,
firms active in cluster activities (formal or informal “members”)
in well-established clusters, report more satisfactory results than
members of more recently established organizations. Introduction of
cluster organizations adds new actors onto the regional stage. This
entry is not unproblematic in that established private and public
organizations (at the local, regional and sometimes even the national
level) might feel redundancy and competition.
Cluster initiatives and organized clusters have become commonplace all around the world. As we gain more knowledge about the
results they deliver, new research and evaluation work can help to
improve cluster policies and programs, and support cluster management in their endeavours. Thus, it is our sincere hope that this
chapter will act as a source of inspiration to cluster managers and
policy makers around the world, in their work of building cluster
commons and more innovative firms.
Sölvell, Ö., Lindqvist, G. (2011) Organising Clusters for Innovation: Lessons from City Regions in Europe Lyon: Grand Lyon CLUSNET Final
Asheim, B. T., Gertler, M. S. (2003) the Goegraphy of Innovation – Regional Innovation Systems. In J.Fagerberg, D. C. Mowery & R. R.
Nelson (Eds.), The Oxford Handbook of Innovation. Oxford: Oxford
University Press.
Asheim, B. T., Cooke, P., Martin, R. Eds. (2006) Clusters and Regional
Development: Critical Reflections and Explorations. Abingdon: Routledge.
Audretsch, D., Feldman, M. (1996) Innovative clusters and the industry
life cycle. Review of Industrial Organisation, 11 (1996), pp. 253–273
Cooke, P. (2002) Knowledge Economies. Clusters, Learning and Cooperative Advantage. London: Routledge.
Diez, M., A. 2001 The Evaluation of Regional Innovation and Cluster
policies: Towards a Participatory Approach. European Planning Studies, Vol 9, No 7.
Duranton, G. (2011). California dreamin’: The feeble case for cluster policies, Review of Economic Analysis, 3, 3–45.
Furman, J., Porter M., E., Stern, S. (2002) Determinants of national innovative capacity. Research policy. Vol. 31, Issue 6, pp. 899-933.
Ketels, C., Memedovic, O. (2008). From clusters to cluster-based econo–
mic development. International Journal of Technological Learning, In118
novation, and Development, 1, 375–392.
Ketels, C., Lindqvist, G., Sölvell, Ö. (2012). Strengthening Clusters and
Competitiveness in Europe – The Role of Cluster Organizations. Stockholm: Center for Strategy and Competitiveness.
Martin, R., Sunley, P. (2003). Deconstructing clusters: Chaotic concept or
policy panacea? Journal of Economic Geography, 3, 5–35.
Morgan, K. (1997) The learning region: institutions, innovation and regional renewal, Regional Studies, 31(5), pp. 491–503.
Morgan, K. and Nauwelaers, C. (Eds.) (1999) Regional Innovation Strategies. The Challenge for Less favoured Regions, Regions, Cities and
Public Policy Series. London: Regional Studies Association.
Ostrom, E (1990). Governing the Commons – The Evolution of Institutions for Collective Action. Cambridge University Press.
Porter, M., E. (2003) The Economic Performance of Regions, Regional
Studies, 2003
Porter, M., E. (1990) The Competitive Advantage of Nations. New York:
The Free Press.
Rosenfeld, S.A. (1996) Does cooperation enhance competitiveness? Assessing the impacts of interfirm collaboration, Research Policy, 25, pp.
247– 263.
Rosenfeld, S., A. (1997) Bringing Business Clusters into the Mainstream of
Economic Development. European Planning Studies 5 (1).
Swann, G., M., P (2006) Cluster and hinterland. In B. Asheim, P. Cooke &
R. Martin (Eds.) Clusters and Regional Development: Critical Reflections and Explorations. Abingdon: Routledge.
Sölvell, Ö., Lindqvist, G., and Ketels, C. (2003), The Cluster Initiative
Greenbook, Stockholm: Ivory Tower Publishers.
The role of institutions in regional development
Few will dispute these days that institutions matter for economic
development. However, one thing is to acknowledge that ‘institutions
matter’, another is agreeing on what institutions are, and on which
institutions matter for development. The concept of institutions
tends to be subjective, controversial, and difficult to operationalize.
As Bardhan (1996, p. 1) puts it, “there are still many differences
among reasonable people on which institutions affect the process of
development and how”, raising the question of how we can intervene in the development processes of a region through institutions.
In order to address this question, we must first understand what
is understood by institutions. Defining institutions is notoriously
difficult, and the current literature on the topic far from agrees on
a common definition. Most literature adopts a relatively minimalist
definition of institutions. The most commonly cited definition is that
by North who describes institutions as “the rules of the game in a
society; (and) more formally, (as) the humanly devised constraints
that shape human interaction” (NORTH, 1990, p. 477). This definition is however far from universally accepted and implies equating
institutions to basic formal institutions. Formal institutions (also
known as ‘hard’ institutions or ‘society’) can be regarded as universal and transferable rules and generally include constitutions, laws,
charters, bylaws and regulations, as well as elements such as the rule
of law and property rights and contract and competition monitoring
systems (NORTH, 1990; FUKUYAMA, 2000, p. 6).
However, as Amin (1999, p. 367) underlines, any economy is
moulded by “enduring collective forces”, which include “formal
institutions such as rules, laws, and organization, as well as informal
or tacit institutions such as individual habits, group routines and
social norms and values”. Informal institutions (also known as ‘soft’
or ‘community’ institutions) include a series of features of group life
“such as norms, traditions and social conventions, interpersonal
contacts, relationships, and informal networks” (RODRÍGUEZPOSE and STORPER, 2006, p. 1), which are essential for generating
trust (FUKUYAMA, 2000, p. 3). They tend to arise spontaneously
through repeated community interaction and prisoner’s dilemma type
decisions (FUKUYAMA, 2000) and social capital accrues as a result
of this interaction. In this respect, the dominant view of institutions
outside mainstream economics is closer to that of Hodgson (2007),
who defines institutions as “enduring systems of socially ingrained
rules” (p. 331) and implies that “institutions cannot be reduced to
specific organisations” (STORPER, 1997, p. 268).
The majority of the literature looking at the relationship between
institutions and development generally assimilates institutions with
formal institutions, such as the rule of law or the protection of human rights and private property (e.g. RODRIK et al., 2004). These
studies tend to be relatively robust in their results, finding that an
absence of basic formal institutions has a detrimental effect on economic development. However, once basic formal institutions are in
place, the relationship between institutions and economic outcomes
becomes much more complex, fuzzy, and difficult to isolate. Despite a general belief that informal institutions matter for economic
development, most analyses by economists about the impact of different types of informal institutions on economic development in
advanced countries find – with a few exceptions (e.g. TABELLINI,
2010) – that the overall effects of informal institutions on economic
activity and welfare tend to be negligible. Indeed, the dominant
view is often times that informal institutions are second best to or
incomplete substitutes for formal institutions and can only prove
useful for economic development in either cases of a serious absence
of, or in the presence of inadequate formal institutions (DURLAUF
and FAFCHAMPS, 2005).
Despite the absence of solid evidence linking institutions – and, in
particular, informal institutions – to regional economic development,
there is a firm belief by institutionalists that informal institutions,
such as culture, history, religion or identity, play a non-negligible
role on the potential of any territory to develop economic activity.
Local and regional institutions are deemed to be much more than
simple regulators of economic activity and to promote development
and growth through creating the necessary ‘orgware’ (VÁZQUEZBARQUERO, 1999) – that is, the adequate conditions for investment,
economic interaction, and trade, that, at the same time, reduce the
risk of social and political instability and conflict (JÜTTING, 2003).
By lowering uncertainty and information costs, institutions
are believed to smooth the process of knowledge and innovation
transfer within and across regions and improve the conditions
for the development of economic activity (NORTH, 1990, 1995;
VÁZQUEZ-BARQUERO, 2002) and to shape the incentives and
disincentives which contribute to establish an ‘adequate’ balance
between coordination and competition among local economic actors, hence facilitating the learning process (DEI OTTATI, 1994;
NORTH, 1995). Formal and informal institutions help territories
to adjust and react to change, generating a degree of ‘adaptive efficiency’ that highlights the willingness and capacity of local actors
to adopt new knowledge and to engage in innovative and creative
activities (NORTH, 1990). Institutions more than any other factor
determine the learning capacity of any region (MORGAN, 1997).
Place-based habits, conventions and routines generate an institutional
capacity which determines the ability – or lack of it – to learn and
adapt to changes and to seek joint solutions to problems (MORGAN, 1997, p. 496).
Many researchers working on institutions have consequently linked
the potential outcomes of local and regional economic development
strategies to the density or thickness of local informal institutions
(e.g. HUDSON, 1994; AMIN and THRIFT, 1995). Storper (1997),
for example, underlines that economic development and growth
depend, to a large extent, on shared conventions embedded in the
territory through the positive externalities generated by local institutions. These sort of virtuous informal institutional arrangements have
been frequently described in the formation of successful industrial
districts in central and northern Italy. The unique institutional setting
of this area, operating both at the local and at the regional level in
regions such as Emilia-Romagna, Tuscany, or Veneto transformed
what could have been simple agglomerations of small- and mediumsized business into dense networks of externalities at the heart of the
development of competitive economic activities (TRIGILIA, 1990).
This dense ‘institutionalization of the market’ (TRIGILIA, 1990),
characterized by strong communitarian bonds, and the presence
of a shared political, social, and cultural identity, contributed to
the generation of the necessary ties of cooperative and competitive
behaviour among economic actors and to the promotion of stable
networks of inter-firm relations (DEI OTTATI, 1994).
Taken to its limits, ‘institutional thickness’ – or its closely related
term ‘institutional capital’ (HEALEY, 1998) – determines to a great
extent the development potential of any territory. Institutionalists
believe that the greater the density of combinations of ‘intellectual
capital’ (i.e. knowledge resources), ‘social capital’ (trust, reciprocity,
cooperative spirit and other social relations), and ‘political capital’
(capacity for collective action), in brief, the greater the ‘territorial
capital’ (CAMAGNI, 2009) within any given region, the greater
the potential for economic development and growth (AMIN and
1998). Thus, acknowledging the importance of institutions would
lead to development strategies more responsive to the needs of the
local institutional environment. This implies taking greater consideration of the functioning and needs of local institutions in the design
and implementation of the strategy and continuously working with
them in order to improve the economic efficiency and returns of
any development intervention (VÁZQUEZ-BARQUERO, 1999).
Otherwise, the risk of failure of any development strategy becomes
ever present.
Building institutions into policy
But how can institutions be modelled into policy? As Farole et
al. indicate, “there are few systematic lessons from the literature
as to how policy can improve or build institutions, and indeed, the
widespread vagueness about the subject carries a risk of squandering public funds” (2011, pp. 1103-04). The only elements that are
clear is that:
a) Institutions are crucial for economic development and deserve
to be considered in any development policy and that
b) Institutional intervention “cannot be done via a ‘one size fits all’
policy framework or simplistic criteria for intervention” (FAROLE
et al., 2011, p. 1101).
In effect, mimicking ‘one size fits all’ regional development strategies in what are widely different institutional contexts is bound to
be counterproductive, as a strategy which has worked in one region
may not necessarily deliver in another. There are countless examples
of successful development strategies being transposed to different
territories not working, and the mechanisms for this failure are
relatively simple. If we were to compare regional economic development to a bicycle, a well-designed and functioning development
strategy would need two well-rounded wheels: a back institutional
wheel with efficient formal and informal institutions propelling the
bicycle forward and a front development strategy wheel tailor-made
to match the institutional environment in which the development
intervention takes place (Figure 1). This will allow a territory to
move forward and develop, minimising the potential fiction between
institutions and strategies.
Figure 1
Unfortunately, this is seldom the case. More often than not, development strategies are transferred from one place to another with
little regard for local institutional conditions, often in the hope that
a well-rounded and ‘tried and tested’ strategy will not only deliver
greater economic development, but also transform the institutional
setting itself. However, this rarely delivers and the outcome is generally
either a mismatch between the strategy and the institutional setting
or a situation where institutions and strategy undermine one another.
Development strategies need thus to understand and be specifically
tailored to the potential of place-bounded institutions in order to
make the most of intervention in human capital, infrastructure, or
innovation (VÁZQUEZ-BARQUERO, 1999, p. 85).
This implies concentrating any development strategy rather than
on the overall institutional environment, which is embedded in higher
level institutions, such as culture and identity, on institutional arrangements, which refer to place specific customs and procedures that
shape interaction, in general, and economic exchanges, in particular
(MARTIN, 2000, pp. 79-80). Regional development intervention
should be mainly concerned not with the institutional environment
that shapes the unique character of any territory (attempting to
change the idiosyncrasy of any territory is not only futile, but is
also bound to encounter serious opposition and end up in failure),
but with the institutional arrangements which represent barriers for
the efficiency of other factors influencing economic development. In
particular, development intervention will be more successful when
it is concerned with the type and quality of institutions needed for
any other type of development intervention to take hold.
When local institutional arrangements hamper, for example,
equal access to education, training and skills; when excessive social
polarization undermines the potential for entrepreneurship; when
impacted information or principal-agent problems affect the smooth
development of economic activity; when rent-seeking, insider-outsider
problems, and clientelism damage the economic development of a
locality, dealing with the specific institutional bottlenecks which limit
the potential of a territory is bound to be much more effective than
concerns with the culture or the nature of a locality or region. As a
consequence, regional institutional intervention needs to adopt the
form of principles or guidelines that can be moulded into a large
diversity of place-based development policies. These principles and
guidelines need to be aimed at disrupting existing lock-in mechanisms
and the set of perverse incentives that may be at the bottom of the
relatively low returns of past development intervention. This also
means the avoidance of prescriptive overarching rules applied to all
territories, which can end up by being more counterproductive than
beneficial for economic development.
Hence, development strategies will need to be specifically tailored
to the conditions of different regional institutional arrangements
which shape the generation, reception and absorption of high quality
human capital and innovation (ENGWALL and KIPPING, 2006),
thus requiring an in-depth understanding of local conditions and
an assessment of the feasibility of different types of interventions
under current institutional circumstances (BARCA et al., 2012). In
particular, this involves a greater interest on local capacity building, with more focus, at least in the initial states, on process than
on outcome indicators, as it is impossible to disentangle different
institutional outcomes associated with capacity building. The main
aim of building local capacity should be to promote local embeddedness and to make the planning and development process much
more inclusive. This requires making local actors more capable and
responsible for the planning and development process and ensuring
that this process responds to the true needs of any given territory.
The goal of this type of institutional intervention becomes thus,
in an initial stage, radically different from that of traditional top
down strategies. Rather than to seek to achieve greater growth
with often limited success, the initial goal becomes to help regions
‘reinvent’ themselves, changing local contexts from activity-hostile
and innovation- and risk-averse into activity-friendly and innovation- and risk-prone.
However, given the nature of institutional intervention, it is
likely that some regions will be able to ‘reinvent’ themselves better
and faster than others. Whether regions can ‘reinvent’ themselves
through institutional intervention will depend on a series of factors,
including the starting conditions and institutional bottlenecks, the
conflict-solving capacities of pre-existing situations, as well as on
the strength and direction of intervention. This involves intervening both in terms of improving formal or ‘societal’ institutions and
‘informal’ or communitarian institutions. The starting institutional
conditions of each region will determine whether the former or the
latter type of intervention is needed, although in most cases, institutional intervention will have to focus on both types of institutions
in order to generate an ‘institutional migration’ that would favour
the development and sustainability of economic activity.
Does this mean that we need to go from ‘one size fits all’ to
purely ‘tailor made’ context-specific policies? A complete swing of
the pendulum could do more harm than good. Going to a local tailor
to order a suit is bound to be more expensive than buying it from
a local shop and not all local tailors may have the quality of a, let’s
say, Saville Row tailor. Hence, resorting to local organisations and
actors to shape development strategies may leave us with substandard
policies, especially in lagging regions, which are often lagging because
of institutional failure. Going to a Saville Row tailor is yet likely to
be much more expensive – certainly not all regions and territories
could afford it – and the additional cost may not justify the outcome.
In addition, ‘tailor made’ approaches to development conducted by
external agents are likely to suffer from insufficient local knowledge
and will, inevitably, add complication to the implementation and
the monitoring process.
The solution may come via an intermediate route: buying relatively high quality suits – i.e. suits that adapt patterns of renowned
designers to local tastes – at decent prices in a shop that provides a
reasonable range of sizes. In development terms this would mean the
setting up by international organisations, supra-national institutions,
or national governments, in a multiscalar way (GERTLER, 2010),
of a series of guidelines aimed at facilitating local capacity building, increasing participation in the development process, increasing
transparency and accountability and minimising corruption – and,
in numerous occasions providing technical, financial, and logistic
support – while leaving sufficient leeway for the constant adaptation
of these institutional and general development strategy guidelines
to local conditions and for the development of interaction and collaboration through networks based on different types of proximity
and reciprocity (HAMDOUCH and MOULAERT, 2006, p. 43).
The issue of scale is therefore crucial. Supra-national and national
development strategies, while providing guidelines for shaping economic behaviour and interaction which can be easily comparable
across spaces, need to be flexible enough to allow for the adaptation
of any form of intervention to locally-specific institutional frameworks (HALL and SOSKICE, 2001; CROUCH, 2005). In other
words, supra-local or -regional strategies need to allow for sufficient
wiggle room in order to maximise the potential for development
of local institutional arrangements and adapt to changes in these
This approach is, however, not devoid of risks and complication
as it implies greater variation in policies and strategies and a ‘true’
principle of subsidiarity. It also means empowering and giving more
control of decision-making of the development effort to lower tiers of
government and formal institutional organisations at the local level
and being open to the reality that many different and even contrasting institutional arrangements may be needed in order to achieve
sustainable development. This may also imply greater moves from
government to governance for the implementation of development
strategies and a much greater resort to genuinely bottom-up policies, empowering individuals, encouraging voice, and mobilizing all
local institutional resources. In sum, the best regional development
strategy is likely to be one that acknowledges institutional factors,
their variability and limitations and attempts to address the potential
shortcomings of local and regional institutional arrangements in a
theoretically- and empirically-informed, yet place-specific, manner.
I would like to acknowledge the generous financial support
of the European Research Council under the European Union’s
Seventh Framework Programme (FP7/2007-2013)/ERC grant
agreement nº269868.
AMIN A. (1999) An institutionalist perspective on regional development,
International Journal of Urban and Regional Research 23, 365-378
AMIN A. and THOMAS D. (1996) The negotiated economy: state and
civic institutions in Denmark, Economy and Society 25, 255-81.
AMIN A. and THRIFT N. (1995) Globalization, Institutional Thickness
and the Local Economy, in HEALY P., CAMERON S., and DAVOUDI
A. (Eds), Managing Cities: The New urban Context, pp 92-108. J. Wiley, Chichester.
BARCA F., McCANN P. and RODRÍGUEZ-POSE A. (2012) The case for
regional development intervention: place-based versus place-neutral approaches. Journal of Regional Science 52, 134–152.
BARDHAN P. (1996) The Nature of Institutional Impediments to Economic Development, Center for International and Development Economics Research, University of California, Berkeley, pp. 1-45.
CAMAGNI R. (2009) Territorial capital and regional development, in
CAPELLO R. and NIJKAMP P. (Eds) Handbook of Regional Growth
and Development Theories, pp. 118-132. Elsevier, Cheltenham.
COOKE P. and MORGAN K. (1998) The associational economy: Firms,
regions and innovation. Oxford University Press, Oxford.
CROUCH C. (2005) Complementarity and fit in the study of comparative capitalisms. In MORGAN G., WHITLEY R. and MOEN E. (Eds),
Changing capitalisms? Internationalization, institutional change, and
systems of economic organization, pp. 167-189. Oxford University
Press, Oxford.
DEI OTTATI G. (1994) Cooperation and competition in the industrial districts as an organization model, European Planning Studies 2, 463-483.
DURLAUF S. and FAFCHAMPS, M. (2005) Social Capital. in AGHION
P. and DURLAUF S. (Eds) Handbook of Economic Growth, vol.1, pp.
1639-1699. Elsevier, Amsterdam.
ENGWALL L. and KIPPING, M. (2006) Management education, media
and consulting and the creation of European management practice, Innovation: the European Journal of Social Sciences 19, 95-106.
policy in the European Union: Growth, geography, institutions, JCMS:
Journal of Common Market Studies 49, 1089–111.
FUKUYAMA F. (2000) Social Capital and the Civil Society. IMF Working
Paper n. 74. IMF, Washington, D.C.
GERTLER M.S. (2010) Rules of the game: The place of institutions in
regional economic change, Regional Studies 44, 1-15.
HALL P. and SOSKICE D. (2001) Varieties of capitalism. The institutional
foundations of comparative advantage. Oxford University Press, Oxford.
HAMDOUCH A. and MOULAERT F. (2006) Knowledge infrastructure,
innovation dynamics, and knowledge creation/diffusion/accumulation
processes: a comparative institutional perspective, Innovation: the European Journal of Social Sciences 19, 25-50.
HEALEY P. (1998) Building institutional capacity through collaborative
approaches to urban planning, Environment and Planning A 30, 15311546.
HODGSON G.M. (2007) The revival of Veblenian institutional economics. Journal of Economic Issues XLI, 325-340.
HUDSON R. (1994) Institutional Change, Cultural Transformation, and
Economic Regeneration: Myths and Realities from Europe’s Old Industrial Areas, in AMIN A. and THIRFT, N. (Eds) Globalization, Institutions, and Regional Development in Europe, pp. 196-216. Oxford
University Press, Oxford.
JÜTTING J. (2003) Institutions and Development: A Critical Review.
OECD Development Centre, DEV/DOC (2003): 08. Working Paper
No. 210. OECD, Paris.
MARTIN R. (2000) Institutional Approaches to Economic Geography, in
BARNES T. and SHEPPARD M. (Eds) A Companion to Economic Geography, pp. 77-94. Blackwell, Oxford.
MORGAN K. (1997) The Learning Region: Institutions, Innovation and
Regional Renewal, Regional Studies 31, 491-503.
NORTH D.C. (1990) Institutions, Institutional Change and Economic
Performance. Cambridge University Press, New York.
NORTH D.C. (1995) The New Institutional Economics and Third World
Development, in HARIS J., HUNTER J. and LEWIS C. (Eds) The New
Institutional Economics and Third World Development, pp. 17-26.
Routledge, London.
RODRIGUEZ-POSE A. and STORPER M. (2006) Better Rules or Stron131
ger Communities? On the Social Foundations of Institutional Change
and Its Economic Effects, Economic Geography 82, 1-25.
RODRIK D., SUBRAMANIAN F. and TREBBI F. (2004) Institutions Rule:
The Primacy of Institutions Over Geography and Integration in Economic Development, Journal of Economic Growth 9, 131-165.
STORPER M. (1997) The Regional World: Territorial Development in a
Global Economy. Guildford Press, New York.
TABELLINI G. (2010) Culture and Institutions: Economic Development
in the Regions of Europe, Journal of the European Economic Association, 8, 677–716. TRIGILIA C. (1990) Work and politics in the Third Italy’s industrial districts, in PYKE F., BECATTINI G. and SENGENBERGER W. (Eds)
Industrial Districts and Inter-firm Co-operation in Italy, pp. 160-184.
International Institute for Labour Studies, Geneva.
VÁZQUEZ-BARQUERO A. (1999) Desarrollo, redes e innovación: lecciones sobre desarrollo endógeno. Pirámide, Madrid.
VÁZQUEZ-BARQUERO A. (2002) Endogenous Development. Routledge, London.
Pontus Tallberg is a Fellow in the organization Regional Studies Association. He is also member in the organization SIMRA (Swedish
society of business economists). He is the editor of several books
around regionalization in Europe and in Sweden. His main interests
are the role of institutions for regional development and the relationships between the state, regions, and municipalities.
Fredrik Rakar has a Dr.rer.pol in social sciences from Osnabrück
University and is currently programme manager at Reglab Sweden, in charge of capacity building within the areas of innovation,
cluster development, public administration and research. He has a
background as an organizational consultant and evaluator, and has
previously been a research fellow at both the University of Sussex
and at SADEV (Swedish Agency for development Evaluation).
Jan Edling now works as an independent consultant through his
company Flexicurity, but was previously an analyst at VINNOVA,
Swedish Agency for Innovation Systems, Research officer at the
Swedish Social Insurance Offices Confederation and a research
officer at the Swedish Trade Union Confederation, dealing with
social policy, consumer policy, wage policy, labour market policy,
immigration policy and industrial Policy for almost 20 years. His in
depth systems knowledge has made him one of the most appreciated
and outspoken analysts in Sweden.
Monika Jönsson is coordinator for business development at Region
Dalarna. She has a PhD in Human Geography and Planning from
Stockholm University. For 12 years she has been active in Dalarna
as a Regional Adviser, specializing in cluster development, smart
specialization, innovation and renewal in business life. Monika
Jönsson is also engaged in Reglab’s innovation activities.
Christian Lindell is an analyst at Region Skåne, with focus on the
areas of skilled labours supply, functions of labour markets, and
industrial policy. He has previously done some research in economic
geography and worked with issues of regional development since
the 1980’s.
Anna Lindberg is the acting deputy director of regional development at the County council of Norrbotten. She has a PhD in work
life organisation from Luleå Technical University and has played a
vital role in the transformation of Reglab to a membership based
Lars Niklasson is Associate Professor of Political Science and Department Chair at Linköping University, Sweden. He has previously
taught at the universities of Uppsala, Sweden and Pittsburgh, USA.
Before joining Linköping University he was a consultant for Ramböll
Management Consulting and the Technopolis Group, specialising in
regional development policy and innovation policy. He is an advisor
to Region Skåne on the merger of regions in southern Sweden and
does research on the challenges faced by Swedish regions. He is also
a national expert for OECD on Local Job Creation.
Örjan Sölvell, Professor, has since 1979 been active as a researcher
and lecturer at the Stockholm School of Economics, SSE, and since
2001 he is also a Senior Associate at the Institute for Strategy and
Competitiveness at Harvard Business School, an institute led by
Professor Michael E Porter. In 2005, he set up a new research institute at SSE, the Centre for Strategy and Competitiveness, CSC. He
is also the acting director of the Cluster Observatory.
Mats Williams is a Senior Executive Fellow at the Centre for Strategy
and Competitiveness in Stockholm since 2011. With a background in
industry, he has been a cluster manager for over a decade. In recent
years, Mr Williams has acted as a coach and advisor to regional
and national policymakers, cluster managers, and cluster program
leadership around the world.
Andrés Rodríguez-Pose is a Professor of Economic Geography at
the London School of Economics, where he was previously Head
of the Department of Geography and environment. He is PresidentElect of Regional Science Association International and a regular
advisor to numerous international organizations. Amongst many
editorial tasks, he is the editor of Economic Geography, and sits on
the editorial board of 27 other scholarly journals, including many
of the leading international journals in economic geography, human
geography, regional science, and management.
This book describes how the prolonged structural reform in Sweden
has forced regions to develop their institutional role and capacity in
an explorative way. As the national government has withdrawn from
strategy formulation and decision-making in regional policy, and
more issues on the local level of governance have to be coordinated
regionally, the demands on the Swedish regions’ institutional capacity
have increased.
In order to meet these demands and overcome regional
disparities in capacity and resources, a laboratory for knowledge-sharing and capacity building called Reglab has been established
by the regions. Based on the principles of a participative approach to
learning, strong ownership by members and a bottom-up perspective
on regional development, this inclusive model of capacity building
facilitates policy implementation, and functions as a balancing and
redistributive measure between the regions.
In this book we have asked the regions to describe how they
have dealt with the challenges of regional development in various
policy areas, and how they have developed their own organizations
in doing so. The book concludes with a chapter by Professor Andrés
Rodríguez-Pose, which highlights the importance of strong institutions
in regional development, and demonstrates how policy and institutional
capacity have to be combined in order to have a real impact.
ISBN 9789198212204
9 789198 212204