Arriving at the Dawn of the New Economy: Is Knowledge-Based Industrial Renewal Possible in a Peripheral Region?

In the contemporary knowledge economy, characterized by both globalization and localization of economic activities, the ability of both firms and their respective regions to adapt to changes in their external environment and to retain their competitiveness is closely related to their capacity to innovate and to continually upgrade existing structures, practices and knowledge bases. In this respect, co-location of firms operating in the new knowledge-intensive sectors is typically considered to be beneficial for both the firms themselves and for their respective regional economies. In this study, we considered whether knowledge-based industrial renewal is possible in peripheral regions. The empirical study was designed to identify tendencies towards and potential concentrations of new knowledge-intensive industries in the relatively peripheral region of Pohjois-Savo in Finland. The strength of such tendencies was determined by employing the Herfindahl index and location-quotient methods. The analysis indic...