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."
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We asked some questions about the spatial scales of their firms’ networks from the executives in city of Vantaa, Finland. Cooperation between different innovation actors from the Triple (or Quadruple) Helix concept is evident in some extend. For knowledge intensive firms, cooperation with regional and national governance is the most important (22% of the respondents saw important or very important). For other firms, cooperation with governance of the city of Vantaa is most important (18%).
Instead, cooperation with other firms is more evident. Regional innovation system consists of Helsinki Metropolitan Area (76 %), but much less the larger entity of Greater Helsinki (24%). In fact, national innovation system is more evident (44%) than larger regional innovation system. Networks extend also abroad (24%) like in RIS literature is concluded. Empiricism from the Helsinki Metropolitan Area shows that concept of regional innovation system holds true in the HMA. Innovation system extends also to national and global scales. Also concept of Triple Helix can be applied into metropolitan areas. Considering networks are stronger between firms than with other innovation actors, the concept of cluster fits better in the HMA in that respect. 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. Some previous innovation studies have recognized the existence of innovation paradoxes, meaning that some regions exhibit stronger (innovation prone) and some exhibit weaker (innovation averse) than expected economic growth relative to their R&D activity (Rodriguez-Pose 1999, Makkonen & Inkinen 2013).
In my PhD thesis, I have identified the under- and overachieving clusters in Helsinki Metropolitan Area in regard to the present state geography of human capital. This gives major advice to planning authorities of the region by highlighting the areas with the most potential for innovative growth. Method is multivariate spatial regression with GeoDa software. Analyzing the connection between zip code area's and its neighbors level of human capital and cluster's innovative output, we get the predictions of the estimated innovative output of the cluster and the residual values of each area, which show how much the area's development is lagged at the present. Results show that new clusters of knowledge intensive jobs and thus innovations could emerge into outskirts of inner city of Helsinki as well as some sub centers in Espoo and Vantaa. Areas rasterized with both styles represent innovation prone areas in regard to both, absolute and relative level of nearby human capital. These areas are southern and northern edge of the inner city in Helsinki as well as Kera, Mankkaa and Laajalahti in Espoo and Jokiniemi in Vantaa. Findings encourage to sufficient zoning of commercial space in ongoing planning of inner city extensions in Helsinki and planning of certain new or developing sub centers in Espoo and Vantaa. |
Photo by Rob Hurson
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July 2018
AuthorJuho Kiuru, geographer living in Helsinki, Finland. |