Going Global 2006
   The Challenges for Knowledge-Based Economies
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Overview

The current knowledge-driven paradigm and the dynamics of globalisation are profoundly affecting countries, societies and economies worldwide. Knowledge and knowledge flows shape innovativeness, productiveness and competitiveness and contribute to depict a new economic geography where boundaries fade, new players emerge, and strategies change. Goods and services are nowadays produced and traded in a world where human beings, capitals and investments - manufacturing plants as well as R&D facilities - look extremely mobile. Such complex dynamics makes it difficult to disentangle causes from consequences. However, one feature emerges neatly: the key role played by science, technology and innovation. On the one hand, S&T and innovation have the potential to improve welfare at all levels, by offering solutions to old and new needs and problems. On the other hand, though, their absence or scarcity may hinder growth and development.

Given the current competitive pressure and the challenges ahead, governments worldwide are reformulating their overall strategies and, in particular, their S&T and innovation policies. The aim is to reap the benefits that may accrue from the creation and exploitation of knowledge, and to improve competitiveness and increase welfare. Such a proactive attitude of governments represents a somewhat novel feature, as in the past globalisation has been mainly driven by economic actors, their interests and strategic behaviours.

The global scenario and the dynamics of knowledge call for new economic and societal frameworks and for the synergic action of all players - no matter the development phase countries are undergoing - if sustainable long term growth paths are to be pursued. Fundamental welfare-related issues hence need careful (re)consideration. Poverty, inequality, environmental concerns, lack of democracy and security threats cast, in fact, a dark shadow over the knowledge-based global economy. Knowledge-based economies - as the concept itself implies - should try to combine the desiderata of all players involved, taking into account the broader economic, societal and environmental aspects of growth and development, thus being ready not only to reap the benefits of globalisation but also to share its costs.

Finland - a knowledge-based small open economy - and the other member states of the European Union are particularly aware of such a need. The global knowledge-based paradigm challenges economies, societies and innovation systems and calls for a variety of approaches and actions, if competitiveness is to be enhanced and global welfare maximised. The kaleidoscopic variety of past and present contexts, characteristics and development trajectories (also technological ones) in fact makes the application of ‘standard’ policy models unsuitable, as “one size does not fit all”.

In an effort to shed light on the complex dynamics of the global and knowledge-based paradigm and to provide a comprehensive and systemic view of the main issues at stake, the conference:

  1. Investigates why companies, especially high-tech firms, go global (session 1).
  2. Explores the impact of globalisation on S&T and innovation systems, as well as the broader socio-economic context, at the local, regional, national, and supranational level (session 2).
  3. Asks if and how the dynamics of the knowledge-based global paradigm change technology and innovation policies and call for new types of governance (session 3).
  4. Looks at how to better share the socio-economic and environmental benefits and responsibilities arising from globalisation and technological change (session 4).

Sessions

Session 1
Companies Going Global: Drivers and Dynamics

Session 1 sheds light over the main dynamics characterising corporate international (re)location. Whether Multinationals (MNEs) or Small and Medium Enterprises (SMEs), firms in fact show an ever growing propensity to become somewhat “ubiquitous”. The question of why is it so immediately arises, i.e. which are the drivers that push companies to locate production plants and R&D facilities elsewhere than in the home country. The analysis of the competitive advantages that enterprises seek in the host countries will entail industries in general and high-tech firms and R&D divisions in particular, given their relevance to knowledge based economies. The session will also investigate the trajectories that corporate relocations take, thus highlighting the new techno-economic geography that emerges. The time dimension of these phenomena will also be addressed, from several perspectives: the development stage of the home and host country; the characteristics of both firms and industries; and the Product Life Cycle of the latter.

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Session 2
The Technological and Socio-Economic Impact of Going Global. A Local, Regional, National and Supranational Perspective

Session 2 deals with the impact that the various corporate relocation phenomena – driven either by cost-reducing and market-penetration or R&D ‘internalisation’ and ‘knowledge augmenting’ strategies - might have on intellectual capital, innovative output and the labour market. On the one hand, (re)locating affects intellectual capital formation and exploitation, as well as knowledge creation, absorption, circulation and spillovers. These depend on the absorptive capacity of the agents - whether countries or firms – and are also moulded by the educational system, the labour market and, more generally, the broader institutional framework. In turn, intellectual capital and knowledge creation, exploitation and circulation play a fundamental role in shaping the development and growth of both enterprises and countries. On the other hand, internationalisation phenomena - especially those entailing the (re)location of R&D - directly affect innovative output in both the host and the home country and shape the ability/capability of firms and systems to innovate. In turn, innovative output contributes to shape productiveness and competitiveness, thus either boosting or depressing trade. Last but not least, the technological and socio-economic impact of going global is shaped by the relationships and loop mechanisms that might exist between intellectual capital formation, innovative output, productiveness and competitiveness. These can in fact either amplify or reduce the impact that the knowledge based global dynamics might ultimately have on growth and development, at all levels.

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Session 3
How Going Global Changes Technology and Innovation Policy-Making: New Types of Governance Needed?

Session 3 aims at answering the questions of whether and to what extent the current and prospective global dynamics call for new types of governance. Such a need arises if different policy domains have to converge towards common strategic objectives like, for instance, in the case of Europe, the ambitious Barcelona and Lisbon targets. Attention will also be devoted to the impact of the various policies put in place by small open economies that ‘go global’ - such as the Finnish global economy program - as well as to international challenging initiatives like the European Research Area. The aim is to shed light on those policies that can catalyse innovation and strengthen innovation systems, thus improving the competitiveness of both member States and the European Union as a whole vis a vis their international competitors. The session will also explore best practices and the needs for (actual and prospective) horizontal innovation policy measures, crossing traditional administrative borders and organizations.

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Session 4
Looking Forward: Making Going Global Sustainable

Session 4 addresses the sustainability aspects of going global, i.e. how to better share the social, economical and ecological benefits and responsibilities arising from globalisation, technological change, and innovation. It will investigate the impact that globalisation and the knowledge-based paradigm might have on both developed and developing countries (e.g. India versus Europe), at various geographical levels (regional, national, etc.). Past, present and future needs and shortcomings will also be addressed, in line with the Helsinki Process started in 2004. The session will also explore sector-specific dynamics, with particular attention devoted to high-tech industries. The role of all socio-economic agents - whether public or private - and their responsibilities will represent a crucial part of the debate.

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