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Knowledge and regional development

Some research claims that the regional effects of different types of knowledge and innovation tend to be of two main types (Castro and Jensen-Butler, 1991):

1. knowledge and innovation which is embodied in the technology itself, such as in the hardware and software, tend to be explicit and codable, and thus easily moved around between regions, which could lead to some geographic decentralisation. Such embodied knowledge and innovation provides some, though limited, added value.

2. knowledge and innovation which is embodied in people as individuals and in their organisations and networks, rather than in the technology, tend to be tacit and non-codable. This can only be moved around between regions to the extent that people as individuals, groups or organisations can be moved around, ie much less easily than the technology itself. Such disembodied knowledge and innovation provides a great deal of value added and is often associated with geographic concentration.

Distinction is frequently made between explicit and tacit knowledge, the former being formalised and codable, often in computer software, and the latter highly contextual to complex situations and not easily codified (Polanyi, 1966, and Amin and Wilkinson, 1999). Tacit, or experiential, knowledge tends to require quite specific organisational and locational environments, normally characterised by face-to-face contacts, to ensure its successful development, use and transmission.

The types of environment most conducive to business functions dependent upon a high degree of tacit knowledge are most likely to be found in the core areas of large cities and metropolitan areas and increasingly less as one moves to geographically peripheral regions. It is in the core areas that the strongest and most successful networks and clusters tend to develop, often facilitated by personal human relations, with economic, social and cultural components. (Gillespie, Richardson, Cornford, 2001, and Millard, 2002b)

The following diagram shows, in very generalised terms, the relative importance of tacit knowledge along this core-periphery continuum. Of special interest are regions which deviate from this trend and the reasons for this.

Core-periphery relationship with economic potential and types of knowledge

(Source: Millard, 2002b)

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© 2002, Institute for Employment Studies