LOCATING BIOTECH INNOVATION PLACES, FLOWS AND UNRULY PROCESSES

Diploma

Introduction

Pharmaceuticals, biotechnology and medical technology are important to Sweden. They contribute to health and welfare, to employment and growth. Our common strategy will contribute to making the Swedish pharmaceutical-, biotech-, and medical industry one of the primary forces for innovation, renewal and sustainable growth in Sweden.  

Thomas Östros, Minister for Industry and Trade, Göteborgsposten/Debatt 7 December 2005 (author’s translation from Swedish)   

The global economic landscape is constantly changing: New industries emerge, old industries wither away and most industries undergo transformation. Centres shift from one neighbourhood, city, region or country to another. Flows of trade diminish, intensify, change direction and reconnect in new network configurations. Regional hierarchies are being shuffled. Some places prosper while others stagnate. Understanding the twists and turns of this dynamic has long been one of the primary objectives of economic geography; while coping with it has always been a key issue for those living in the places, regions and nations that, at a given moment, are being redefined. Indeed, it is fair to say that virtually every contemporary market economy is characterized by some sort of – often academically informed – public policy response to shifting economic realities (Dicken 2007). Recently, we have seen the rise, in this context, of a new set of strategies that are commonly termed ‘tech-based’ economic development. Tech-based economic development involves an understanding of, and responses to change in economic landscapes that build on the notion that technology is one of the most powerful forces behind economic growth (Freeman and Perez 1988; Freeman 1988), and that this force can in turn be harnessed for the gains of local, regional and national economies (Kline and Rosenberg 1986; Storper and Walker 1989; Malecki 1997; Edquist 1997; Braczyk, Cooke, and Heidenreich 1998; Cooke and Leydesdorff 2006). 

This thesis is an investigation into the potential – and limits – of tech-based development policies for creating renewal and economic growth at the local, regional or national scale. The study at hand focuses on biotech-centred strategies in Sweden. How does it really work when a team of biotech researchers develops a new invention? How can a small Swedish town manage to attract large foreign direct investments and stay competitive in the global biotech landscape? How is the performance of biotech knowledge workers affected by the places they live in, go to, leave, and make up? What impact can a biotech firm have on the local economic landscape in which it is located? These are the kind of questions that are studied in the present thesis. The ambition, however, is to also say something more general about the very notion of tech-based development of economic spaces. One interesting aspect of such development strategies, which is seldom addressed, is the fact that a majority of the new industries and knowledge activities that politicians and academics hope will be providing the regional prosperity of tomorrow are ‘more than regional’. Biotech and similar industries are intensely linked to global value-chains, markets and production networks, and this aspect of their configuration makes them particularly hard to understand and govern from a regional or national point of view. Still, having a strong biotech industry or innovation system is a common object of desire for governments around the world; of which the above-quoted statement made by the former Swedish Minister for Industry and Trade is but one expression. 

The term ‘more than regional’ does not exclude the existence of localized elements in biotech activities or knowledge creation. Even though the biotech industry is globally connected and interdependent, it is not disconnected or independent from local environments. Indeed, the nodes of importance in global biotech networks are in a sense nothing more than a set of local milieus (Amin and Thrift 1992; Porter 2000; Audretsch 2001). Therefore, becoming a biotech hotspot is not a totally unobtainable object of desire. The problem is rather that we are dealing with two spatial systems that are not very compatible but still often treated as one, therefore potentially giving false hope in many cases. 

If we look at biotech-based economic development we have, on the one hand, a biotech innovation system and industry which is global but at the same time consists of localized elements. On the other hand we have national and regional economies that although they are definitely impacted by global events are fundamentally territorial in terms of governance. This creates a spatial mismatch since the first spatial system only partly and occasionally takes place or passes through the second system (compare Dicken and Malmberg 2001). In turn, this means that although it is clear that the first system, the global biotech industry, creates large amounts of economic growth and wealth, it is by no means guaranteed that a system of the second type will gain much from this value creation – not even, this thesis argues, if parts of the first system are located in the particular regional or national territory of the second system. Nor is it certain that territorially based policy apparatuses can have much of an impact on the direction and efficiency of the particular units and processes of the global biotech system located within their territory (compare Massey, Quintas, and Wield 1992). We can expect, however, that regional and national efforts will have consequences of sorts. Capital invested in biotech-based regional development is bound to end up somewhere; the question is: where? 

The point of departure for this thesis, then, is that there is a mismatch between the aforementioned spatial systems and that this mismatch is underresearched. From an innovation policy perspective, it is of utmost importance to understand how the territory delimiting the responsibility of the policymaker is connected to the global system. Many like to think that techbased industries like biotech are the way forward for regions and nations but at the same time it seems reasonable to assume that investments made in one of the many territories to which the global biotech system is connected, might very well ‘leak’ out of that territory and, in the worst case scenario, even end up supporting a competing milieu. From an academic point of view, the questions under study in the thesis touch upon some of the most central issues of economic geographic inquiry, that is, on the one hand, how the spatial configuration of economic activities matters and, on the other, how human activities reconfigure and shape economic landscapes. If we take into account the rate of increase in the interest for tech-based economic development around the world, there is an urgent need to further develop our understandings of their true potential and limits. The present thesis attempts to make a contribution towards this end by developing a conceptual framework, within which we can better make sense of the complex and multiscalar nature of biotech innovation and, in turn, formulate better (bio)techbased economic development policies for regions and nations.