Finnish Environment Institute has defined population density, which allows cost efficient public transport. It is 20 inhabitants per hectare. In the most populated parts of Finland (figure below), nearly half of The Helsinki Metropolitan Area is dense enough. However, there is still work to do. For example the corridor of future underground extension will need some infill development if wanted to pay off.
In some other parts of Finland, regions face different kind of challenges. Albeit city of Seinäjoki is growing fast, in an entire state of Southern Ostrobothnia (figure above), there are only four 250m x 250m squares that are dense enough for cost efficient public transport. By the way, the figure above is part of a first commision of my newly founded firm, Urban Analytics Helsinki. It was made with an open source software (QGis) as well as of open data (Statistics Finland, National Land Survey of Finland). The figure below is made just for the fun of it. :)
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Okey, maybe the term is not the most innovative, like the horses were the accelerator of the innovation cluster in Helsinki Metropolitan Area. I'm sure it's something else, like the products of the creative professionals who have concentrated in that cluster (which btw, now in this presentation, looks like a doughnut:).
Be that as it may, a vast majority of the members of the creative class live in that doughnut, or horseshoe, and almost all the knowledge intensive workplaces locate in that one cluster. Only a few tiny concentrations of creative class and innovative firms lay outside the main cluster. I decided to form only one large cluster to the Helsinki Metropolitan Area based on analyses, because it felt the most natural thing to do. Remembering the flows of information it is not hard to see that the neighbourhoods with the high points from the analyses forms not an archipelago but a cluster of chained islands. With the history in master planning it is too the most natural thing to form larger objects from the smaller entities. If policy implications are dear, I could state that every penny invested in that cluster will pay off positive amounts of money and other much seeked products of the information age city: namely innovations and productions. Also, talking about the humans in the cluster, it emerges human capital there, which is essential in producing the just explained benefits of innovative and productive city . Often the talk concerns creative people, but the people outside that class or movement or just a lifestyle or something, are forgotten. But hey, don't worry about the workforce with less or no skills. They benefit from the investments to the cluster too. It is calculated that in American cities every creative job generates five low-skill workplaces! Another recommedetion would be that you can't create a new cluster outside the cluster. They just don't make it (Porter 2010). But, if you are working with Vantaa, you might have noticed first the points of creativity and innovativeness in Vantaa. The former flourish in Western Vantaa and the latter one in the central parts of the city. A cluster formed of one or two neighbourhoods are not bad at all. After all analysis has estimated the creativity and innovativemess of the neighouring areas as well. So the points in Vantaa could be thought of as larger entities than just one district. And if you think of the division of the Helsinki Metropolitan Area, so called "pienalueet" (what on earth it would be in English; minor areas? ;D) are still quite large, despite the name they have. Because these clusters are maybe not so large, they are significant (estimated with spatial statistics), that they are most warmly recommended to be directed all kind of developments in. Also in Eastern Helsinki, widely criticized as socially and ethnically segregated area, has also it's tiny clusters. However, these clusters could grow or merge in the main cluster not so far from them. On the other side of social spectrum, fighting against segregation, the city of Helsinki has pumped loads of money to Eastern Helsinki, but besides some bright stars, like Myllypuro, not much positive has evolved what comes to research I have read. With the results of the paper visible and bearing in minds Porter's wisdom of the theory he created, it is clear that the city of Helsinki could rethink the areas where the funding should be aimed at geographically. It is important to remember that I believe that Porter not by any means meaned that the areas outside the clusters could be left on their own and segregate from the areas belonging to the cluster and funded exclusively. Areas with the ability on innovation or human capital production should of course be funded with different objects than the areas with no significant potential. In recent study published soon, we tested whether clusters of innovation locate in proximity of human capital, i.e. skilled, educated and tolerant workforce. We found out that this holds true in the Helsinki Metropolitan Area. However, as a grace note we were able to show evidence of agglomeration externalities in the HMA.
We concluded that "urban density is an essential, and often underrated, circumstance for innovative growth. Considering planning and the mixed land use paradigm, the results show evidently that innovations emerge the best in dense and mixed urban structure." "The geographical characteristics are that clusters of innovation and human capital as well as clusters with potential growth form a larger spatial entity (an innovation “horseshoe”). Finding is in line with “Smart Café City” concept (Fu 2007), where human capital externalities are highly localized in the most central areas of the metropolitan areas." There is a rather wide literature of agglomeration economies that (especially knowledge intensive) firms gain when clustering in metropolitan areas (e.g. Nicolini, R. 2012 in O'Sullivan: Urban Economics). These economic forces are divided into localization economies and urbanization economies. Former refers to benefits from single industry clustering and the latter to benefits when clustering cross industry boundaries. We wanted to find out some empirical reasons behind location choices of firms and asked some of the reasons from the executives of the firms in surrounding city of Vantaa in Helsinki Metropolitan Area (Merisalo & Kiuru (eds.) 2016). We recognize that the list of the factors is not by any means comprehensive nor is the sample size very large. However, our findings are mainly in line with the literature considering location choices of the firms. From our survey, it seems that the most important factors determining company's location choice are quite practical. Almost all, 93 % of the respondents, saw space costs important or very important factor when choosing their firms' location. Accessibility was important or very important to 89 % and infrastructure of the area to 84 % of the executives. Many studies have stressed the benefits from the labor pool that firms gain in agglomeration economies. Thus, in our survey, the availability of the workforce was seen as the third most important reason for location choices. When asked only from the knowledge intensive business services (KIBS), the availability of the workforce was in fact seen as the joint top factor with 89 %. There's plenty of debate whether urban amenities are important in determining the location of the companies. In our survey 51 % of the companies found restaurants of the neighborhood and 41 % other commercial services of the neighborhood important or very important factors. There are also different views whether firms follow talented workforce or whether employees follow firms. From our survey, it seems that also firms locate in proximity of workforce. We asked also in which spatial scale different factors were seen important; within neighborhood, city or metropolitan area. Workforce was seen largely as a regional resource. Instead, restaurants of the area, were seen most important within the city and within the neighborhood rather than within the whole region. Presence of universities and other research institutes is again regional resource. However, only 36 % of the executives saw them important or very important. Even examining only KIBS firms did not raise the percentage. What is good to know, is that City of Vantaa does not hold any universities. Thus, it may be that presence of universities is more important to those firms that locate in university cities of the HMA. Another reason determining the location choices of the firm is the brand of the area. It was important or very important to 56 % of the firms in Vantaa, but when asked only from the KIBS firms, the percentage rose again. All in all, there are many reasons that affect the location choices of the firms. According to our survey, it seems also that for knowledge intensive firms there are more factors that affect their location choice than for other firms. |
Photo by Rob Hurson
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July 2018
AuthorJuho Kiuru, geographer living in Helsinki, Finland. |