Nordic Cross-Border Innovation Policy

By Lise Smed Olsen & Maria Lindqvist

Cross-border innovation policy has been discussed in the recently completed OECD project Regions and Innovation: Collaborating Across Borders? Some of the key issues included the need for cross-border statistics, identification of opportunities for co-operation, and the increasing role of private sector involvement.

Nordic cross-border co-operation and the (new) area of innovation

Since the 1970s, cross-border co-operation in the Nordic countries has gradually developed with the establishment of 12 border committees, which still exist. The committees were established as organisations with members from a variety of political levels. Some have only municipal representation, while others are comprised of representatives from both municipal and regional authorities. The border committees vary in terms of their main focus areas, but all seek to remove actual and mental border barriers in the regions.[1] Typically, job creation is a concern of the border committees, and in some cases innovation policy is becoming an area of cross-border co-operation.

Increasing interest in the innovation policies of Nordic border committees is demonstrated by the OECD project Regions and Innovation: Collaborating across Borders? in which three of six case study regions have Nordic border committees co-funded by the Nordic Council of Ministers (NCM): the Öresund Committee, the Bothnian Arc, and TRUST Hedmark-Dalarna. The OECD project has analysed why and when cross-border collaboration for innovation is beneficial, and the notion of a functional region is important for innovation. Functional regions are described as geographical areas with innovation and knowledge flows that may cross administrative borders.

Cross-border statistics: A challenge to Nordic co-operation

An important conclusion and recommendation from the OECD project is that there is a need for cross-border statistics to identify whether a functional cross-border area of innovation is in place. Indicators are required to measure innovation-related flows of people, goods, services, capital, and knowledge, which can help define the relevant geographical scale of cross-border areas.

In 2008, the Nordic Council of Ministers initiated the joint Nordic database, StatNord, and commissioned the national statistics agencies in Denmark, Norway and Sweden to present cross-border statistics for migration and the labour market.[2] However, after the launch of the database it was not possible for the national authorities to reach an agreement on financing the continuous updating of the database. Consequently, StatNord has not been updated since 2010, and currently there is no indication that this work will recommence, because the compilation of statistics depends on the commitment of all the countries involved in Nordic cross-border collaboration.

"Cross-border efforts should target 'functional' regions for innovation, but we cannot easily 'see' what that region should be. Data are often lacking to make that determination. Regions typically need to rely on national statistics offices for data and/or harmonisation with neighbouring country definitions, yet this subject is not a top priority for national agencies with increasingly tight budgets."[3]

Statistics on cross-border activities are thus difficult to obtain even outside the Nordic countries. Generating cross-border statistics is a priority for some border committees, and there are some regional initiatives, such as the Örestat database in the Öresund region, where the Öresund Committee allocates resources to the collection of relevant statistics, for example, on commuting trends.

When cross-border innovation policies are appropriate

Another related recommendation from the OECD project is only to pursue the cross-border element when it is beneficial to do so. The most obvious test of this in the case of a border region is to identify whether the workers, firms and research-intensive actors in the region see a benefit to cross-border interactions.[4] As part of the project, the OECD missions to the case study regions brought together private and public innovation actors. In some cases, the mobilisation of innovation actors was managed on behalf of the border committees by regional development departments on either side of the border, which involved individuals working with regional innovation policy. In terms of facilitating cross-border innovation, strengthened collaboration is significant between the relevant regional and local development authorities, business development organisations and universities.

The Nordic border committees can play a role in mobilising relevant actors across the border and demonstrating political commitment to the promotion of innovation collaboration. This is already done, for example by the Öresund Committee, which has adopted a Regional Development Strategy (the ÖRUS) that includes a long-term vision for the area in 2020 focusing on four themes, one of them being 'knowledge and innovation'. Notably, this is a border region where cross-border co-operation has developed over time, especially in areas such as life sciences, ICT, and material sciences. It is therefore an example of a region where co-operation in cross-border innovation has been deemed advantageous, albeit in practice mainly between the Danish capital region and the Malmö-Lund area of Skåne, and to a lesser extent in the remaining part of Skåne and the region of Zealand, which are also part of the Öresund region. The greater Copenhagen-Malmö-Lund area may be defined as the functional region for innovation. The development of a functional border region for innovation can be facilitated by public infrastructure, as in the case of Öresund where there are good road and rail connections across the bridge. Regions such as the Bothnian Arc and Hedmark–Dalarna, which are dominated by low population density, long distances and lack of public infrastructure for commuting, challenge the notion of a functional region.

Depending on the practicality of strengthening cross-border co-operation in innovation in individual border regions, some border committees may consider putting greater emphasis on this policy area. In other instances, it may be more advantageous to strengthen cross-border innovation collaboration with other neighbouring regions outside the cross-border area defined by the border committees.

Increasing focus on private sector involvement

The OECD project stresses the need for wider stakeholder involvement, taking into consideration the Quadruple Helix model of government, university, industry, and wider civil society co-operation. None of the Nordic border committees that have taken part in the project have representatives from the private sector or higher education institutions on their boards. The rationale for wider stakeholder involvement is elaborated by the OECD.

"Innovation is a process led by the private sector; therefore it should play a key role in informing and implementing cross-border collaboration. Innovation takes place within a system of actors. This involves public authorities, companies, research and education organisations, and other members of the society (non-governmental organisations, citizens' representatives, etc.). These four categories of actors have been referred to in the innovation literature as the 'quadruple helix'. Different mechanisms may be required to solicit their input and leadership in cross-border action."[5]

The issue of private sector involvement was discussed at the annual Border Region Forum organised by the NCM in November 2013. This is a two-day seminar where representatives of the Committee of Senior Officials for Regional Policy and the Nordic border committees meet. In addition to minor project funds from the NCM, for the past two decades, the EU INTERREG programmes have been an important funding source for cross-border co-operation projects conducted by border committees as well as other institutions in the border regions.[6] Therefore, the first day of the Forum focused on discussions on the upcoming INTERREG programme period, with the ambition of attracting greater private sector involvement.

On the second day of the Forum, Karen Maguire, Policy Advisor to the OECD and author of Why focus on cross-border policies to support regional innovation? presented the findings of the OECD project. The discussions that followed centred mainly on the issue of private sector involvement. It was considered, for example, that it might be more appropriate to have representatives from chambers of commerce or business network managers on the border committees rather than individual companies to provide a wider perspective on the innovation systems of the regions, and to avoid the risk of a few strong companies dominating the agenda. It is uncertain whether Nordic border committees will strive to include business communities and knowledge institutions to a greater extent in their strategic work in the future; however, INTERREG co-funded projects are likely to have greater private sector involvement, which in turn may facilitate cross-border innovation.

In conclusion, the notion of the functional region is significant in the development of cross-border innovation policy. The border committees may play a significant mobilising role, focusing on innovation in areas where opportunities have been identified and cross-border strategies may be significant in demonstrating political commitment. Meanwhile, it is important to consider whether co-operation should be limited to cross-border areas defined by border committees or widened to include other neighbouring regions. Alternatively, in some cases, innovation may not be the most appropriate area of co-operation for a border committee with respect to adding value to cross-border collaboration.

Back to Nordregio News Issue 5, 2013

[1] Harbo, L.G. (2010) Nordiska gränskommittéer och gränsöverskridande myndighetsintegration, Nordisk arbetsgrupp 2: Globalisering och gränsöverskridande samarbete, Nordregio Working Paper 2010:1.

[2] Nordregio (2011) Cross-border co-operation in the Nordic region: 11 projects that have changed their region.

[3] OECD (2013) Regions and Innovation: Collaborating across Borders, OECD Reviews of Regional Innovation, OECD Publishing, p. 19.

[4] Ibid.

[5] Ibid., p. 23.

[6] Hallin, G.; Olmsäter, T. (2011) På tvärs för engagemang, synlighet och effektivitet: Analys av det gränsregionala samarbetet i Norden, Kontigo, Stockholm.