Regional Competitiveness Under New Perspectives
by Karl Aiginger and Matthias Firgo
The term “competitiveness” has been used in conceptually distinct ways at the firm, regional and national levels. After primarily reviewing existing concepts at the national level, we introduce a new definition of regional competitiveness adapting definitions used in the academic literature. Specifically, we connect “outcome competitiveness” with new perspectives on a more socially inclusive and ecologically sustainable growth path, as envisaged in the WWWforEurope research program, in which 33 European research groups are taking part. Evaluating competitiveness requires both an input assessment (costs, productivity, economic structure, capabilities) and an outcome assessment. We define regional outcome competitiveness as the ability of a region to deliver Beyond GDP goals. For regions in industrialized countries, this ability depends on innovation, education, institutions, social cohesion and ecological ambition. Given this new perspective (of broader Beyond GDP goals), social investments and ecological ambitions should not be considered costs, but rather drivers of competitiveness. This is compatible with a new innovation policy fostering non-technical innovations and a new industrial policy supporting societal goals. Applying this concept to European regions, we show which regions take the "high road" to competitiveness and compare our results with the existing literature.