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Regional Dimensions of Innovative Activity in Outer Western Sydney

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Regional Dimensions of Innovative Activity in Outer Western Sydney REGIONAL DIMENSIONS OF INNOVATIVE ACTIVITY IN OUTER WESTERN SYDNEY Samantha A. Sharpe A thesis submitted to the College of Health and Science In fulfilment of the requirements for the Degree of Doctor of Philosophy August 2007 Urban Research Centre University of Western Sydney Samantha A Sharpe © 2007 Statement of Authentication The work presented in this thesis is, to the best of my knowledge and belief, original except as acknowledged in the text. I hereby declare that I have not submitted this material, either in full or in part, for a degree at this or any other institution. Samantha A Sharpe Abstract The aim of this research is to understand the socio-economic development of a metropolitan region in Sydney through an analysis of regional innovative activity. South West Sydney, a major growth region within Sydney, includes the Local Government Areas (LGAs) of Liverpool, Campbelltown, Camden and Wollondilly. This region has absorbed 25% of Sydney’s population growth in the period from 1991-2001. Although South West Sydney has experienced rapid population growth, this has not been matched by associated employment growth. In some sectors such as business services employment growth has been minimal in the previous decade, this is particularly the case in Liverpool, the regional centre of South West Sydney. Population growth is estimated to continue at the current rate (in excess of 5% per annum) for at least the next fifteen years. In this environment, local government authorities in the region are seeking ways in which to develop the regional economy of South West Sydney and increase the amount of sustainable employment commensurably with current population and labour force increases. The role of innovative activity has a central place in economic development. This thesis uses a ‘systems of innovation’ (SI) approach to examine innovative activity in the South West Sydney region. SI understands innovation as a socially embedded process of transforming ideas and knowledge into novel products, processes and services through the processes of learning and searching. The approach recognises that innovative activity is determined by various actors (firms and institutions) and the interactivity between these actors and the cumulative base of knowledge in which they operate. The Regional Innovations Systems (RIS) framework develops from an acknowledgement that innovation is primarily a geographically bounded phenomenon. The RIS approach sees that specific local resources are important in determining and encouraging the innovative activities carried out by local firms and hence, the competitiveness of these areas. The RIS literature provides two fields of understanding of what constitutes a regional innovation system. The first takes the global examples of highly innovative regions such as Silicon Valley and Route 128 in the United States of America (Saxenian 1994), South West England (Cooke and Morgan 1998), Baden Wurttemberg in Germany (Cooke 2001; Braczyk, Cooke et al. 2004), Northern Italy (Piore and Sabel 1984) and in Australia, the North Ryde corridor (Searle and Pritchard 2005). These regions represent ‘ideal’ or ‘star’ RIS, with highly specialised and networked clusters of firms, many Abstract iii forms of supporting regional infrastructure, and high levels of interactivity. The second and emerging field understands RIS to be in existence in all regions and individual RIS are identified on a scale from weak to strong (Wiig and Wood 1995; Cooke and Morgan 1998; Cooke 2001). This second stream includes the analysis of regions seeking to encourage innovative activity by using the RIS approach to examine their local resources and connectedness. It seeks to determine how not only local resources but also their connectedness could be enhanced to increase firm competitiveness. The innovation systems represented in the ‘ideal’ regions are largely a world away from what is available and what is necessary in the encouragement of RIS in most other regions. However, the conceptual framework for examining and interpreting RIS is derived from the analysis of these ‘ideal’ regions. This framework does not provide for measurement and effective interpretation of a range of activities that may be present in less exceptional regions. This research contributes to this endeavour by providing a method that allows for interpretation of a wider range of innovation activities through the analysis of knowledge intensive services activities (KISA). The focus on knowledge gathering, particularly through the KISA analysis, provides an examination of the relationship between innovation, learning and knowledge, much more so than more traditional measures of innovative activity e.g. patents and research and development (R&D) expenditure. KISA analysis is an emerging field of innovation research. KISA are closely linked to firm innovative activity (OECD 2006) and through an analysis of regional KISA usage, an understanding of innovation and knowledge activities within the region can be constructed. This analysis applies equally across various regions and provides an opportunity to guide regional economic development policy intervention at the local government level in South West Sydney. Abstract iv Acknowledgements There are many people I would like to thank for their help and encouragement over the past three and a half years. Although my name is on the title page, the journey for me to get here has not been a solo one. First, I would like to thank my principal supervisor, Dr. Cristina Martinez- Fernandez for all of her support, guidance and encouragement. I have learnt a great deal from working with her and I know I would not have got to this point without her. I would also like to thank my co-supervisor, Prof Russel Cooper. His advice and comments have been invaluable to my progress particularly in the final few months. I would like to acknowledge the assistance of Prof. Tong Wu in providing advice and guidance in the final preparation of this thesis. As my research is a linkage project with Liverpool City Council I have been fortunate to work with two industry partners, Graham Larcombe and Phil Tolhurst. I would like to thank Graham for encouraging me to join the project in the first place and for his ongoing support since. I would also like to express my appreciation for Phil Tolhurst, who has given the project his every assistance despite his busy schedule. I would like to thank my colleagues at Liverpool City Council, their continued dedication to the South West Sydney community, sometimes in the face a great odds, is inspiring. It has been a pleasure working with them over the past six years. I would like to particularly mention Colleen, Bozena, Mira, Martin, Carl, Pierre, Debbie, Grace, Aidan and the rest of the Strategic Planning Team. At the University of Western Sydney I have been fortunate to work alongside a number of talented and exciting researchers, Merete, Marc, Tavis, Monty, Navin and Tamara and from the University of Sydney, Santosh, Asif, Richard and Acknowledgements v Tony. These people have contributed to my intellectual development and passion for research as well as becoming firm friends. Finally, I would like to thank my family; my parents Sharon and Russell, my grandparents Aub and Gladys, my siblings Dale, Miles and Cassandra and my husband Christian. The two most influential people in my life are my mother and my husband and I thank them especially. My mother for always believing that there was nothing I could not achieve if I wanted to, and for also teaching me that if I did do something, to make sure I did it well. I thank my husband, Christian, for supporting me in so many ways; through all the late nights, the stressful computer episodes, the house covered in papers and reading and learning much more about regional innovation than I am sure he ever intended. I thank them both and it is to them that this thesis is dedicated. Acknowledgements vi for Sharon and Christian Acknowledgements vii Table of Contents Abstract .......................................................................................................................iii Acknowledgements.......................................................................................................v Table of Contents.......................................................................................................viii Index and Tables, Charts and Graphs.............................................................................x Glossary of abbreviations...........................................................................................xiii Chapter 1 - Introduction ................................................................................................1 1.1 The research context - Innovation and regional economic development................2 1.2 The research problem ..........................................................................................8 1.3 Research design.................................................................................................12 1.4 Scope of the study .............................................................................................14 1.5 Research significance ........................................................................................20 1.6 Structure of the thesis ........................................................................................21 Chapter 2 - Knowledge & innovation activities in regions ...........................................23 2.1 Innovation and knowledge
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