1、OECD Regional Development StudiesRegions inIndustrial Transition 2023NEW APPROACHES TOPERSISTENT PROBLEMSOECD Regional Development StudiesRegions in Industrial Transition2023NEW APPROACHES TO PERSISTENT PROBLEMSThis document,as well as any data and map included herein,are without prejudice to the st

2、atus of or sovereignty overany territory,to the delimitation of international frontiers and boundaries and to the name of any territory,city or area.The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities.The use ofsuch data by the OECD is wit

3、hout prejudice to the status of the Golan Heights,East Jerusalem and Israeli settlements inthe West Bank under the terms of international law.Note by the Republic of TrkiyeThe information in this document with reference to“Cyprus”relates to the southern part of the Island.There is no singleauthority

4、 representing both Turkish and Greek Cypriot people on the Island.Trkiye recognises the Turkish Republic ofNorthern Cyprus(TRNC).Until a lasting and equitable solution is found within the context of the United Nations,Trkiyeshall preserve its position concerning the“Cyprus issue”.Note by all the Eur

5、opean Union Member States of the OECD and the European UnionThe Republic of Cyprus is recognised by all members of the United Nations with the exception of Trkiye.Theinformation in this document relates to the area under the effective control of the Government of the Republic of Cyprus.Please cite t

6、his publication as:OECD(2023),Regions in Industrial Transition 2023:New Approaches to Persistent Problems,OECD Regional Development Studies,OECD Publishing,Paris,https:/doi.org/10.1787/5604c2ab-en.ISBN 978-92-64-37324-2(print)ISBN 978-92-64-99908-4(pdf)ISBN 978-92-64-91197-0(HTML)ISBN 978-92-64-7417

7、2-0(epub)OECD Regional Development StudiesISSN 2789-7990(print)ISSN 2789-8008(online)Photo credits:Cover Galeanu Mihai iStock/Getty Images Plus.Corrigenda to OECD publications may be found on line at:www.oecd.org/about/publishing/corrigenda.htm.OECD 2023The use of this work,whether digital or print,

8、is governed by the Terms and Conditions to be found at https:/www.oecd.org/termsandconditions.3 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Foreword Beginning in 2018,the OECD and the European Commissions Directorate General for Regional and Urban Policy(DG REGIO)embarked on a Pilot Action as an

9、 experiment to learn what happens when policy makers:1)expand their thinking on pathways to enhance innovation as a driver of regional development;and 2)are given the opportunity to take actions that would usually not be possible under the constraints of existing governance arrangements,such as regu

10、lations or budget frameworks,or embedded policy practices that may stymie innovative programme design.This experiment targeted regions in industrial transition and challenged them to rethink their approach to innovation policy and smart specialisation strategy(S3)design and implementation.The first

11、phase(2018-2019)of this collaboration focused on a diverse set of policy dimensions that could enable regions or countries,through greater innovation,to better support industrial transition.These dimensions included:jobs and skills of the future;entrepreneurship and SME support;innovation and innova

12、tion diffusion;a just(and green)transition to carbon neutrality;greater well-being and inclusiveness.With the participation of ten pilot regions and two pilot countries selected by the European Commission,a series of workshops explored the potential that each of these drivers had to promote innovati

13、on as a means to advance the development of regions in industrial transition.Participating regions and countries then developed and implemented a High Impact Action,with the support of the European Commission,in order to pilot new and experimental approaches to the design,implementation and governan

14、ce of innovation programming to advance their industrial transition objectives.In the final phase of this institutional collaboration(2022-2023),the OECD,with the support of the European Commission,worked with eight of the ten original regions and the two original countries to identify whether or no

15、t the experimental processes demonstrated potential for advancing innovation initiatives and,in turn,for advancing industrial transition.This report provides a synthesis of the findings from this final phase.It builds on work from the first phase of the Pilot Action,including questionnaire responses

16、 from each of the Pilot Action participants,stakeholder interviews with each region and country,in-depth desk research,and OECD work in other areas such as multi-level governance and factors generating territorial divides in trust in government.The report highlights policy makers must address indust

17、rial transition challenges.It is complemented by case studies exploring the experimental nature of each of the ten High Impact Actions developed as part of the Pilot Action,and how experimental governance and programme pilots support industrial transition,innovation and smart specialisation.This rep

18、ort was developed as part of the Programme of Work of the OECDs Regional Development Policy Committee(RDPC),a leading international forum in the fields of regional,urban,and rural development policy and multi-level governance,which is served by the Centre for Entrepreneurship,SMEs,Regions and Cities

19、(CFE).The RDPC emphasises the importance of multi-level governance and place-based approaches that are tailored to regional and local needs.The report was approved by the Regional Development Policy Committee through written procedure on 15 September,2023(CFE/RDPC(2023)/15).4 REGIONS IN INDUSTRIAL T

20、RANSITION 2023 OECD 2023 Acknowledgements This report was prepared by the OECD Centre for Entrepreneurship,SMEs,Regions and Cities(CFE),led by Lamia Kamal-Chaoui,Director,and is part of the programme of work of the Regional Development Policy Committee.The report is a synthesis of the findings from

21、work with eight regions and two countries in industrial transition that developed High Impact Actions initiatives applying experimental governance arrangements or programming to advance along their growth trajectories.It originates in work undertaken in 2018-2019 under a European Commission sponsore

22、d project“Pilot Action on Regions in Industrial Transition:The Peer-learning Exercise”,that culminated in the OECD report Regions in Industrial Transition:Policies for People and Places.The financial contributions and support from the Directorate-General for Regional and Urban Policy(DG REGIO)are gr

23、atefully acknowledged.The OECD Secretariat would particularly like to thank the local teams and their leaders in each participating region and country for their commitment to this project since its inception and for their willingness to share their experiences and High Impact Actions:Cantabria(SP),C

24、entre-Val de Loire(FR),East and North Finland(FI),Grand-Est(FR),Greater Manchester(UK),Hauts-de-France(FR),North Middle Sweden(SE),Wallonia(BE),and Lithuania and Slovenia.The project was co-ordinated by Sandra Jolk,under the supervision of Maria Varinia Michalun,Head of the Governance and Strategic

25、Planning Unit in the Regional Development and Multi-level Governance Division in CFE,led by Dorothe Allain-Dupr.The report was developed by Maria Varinia Michalun,Luca Tacconi and Geoff Upton,with contributions from Sandra Jolk.The High Impact Action case studies were drafted by Hyunjoon Cho,Sandra

26、Jolk,Nikos Patias,Matteo Schleicher,Luca Tacconi,and Geoff Upton.The report benefited from additional comments of Rdiger Ahrend,Andrs Fuentes Hutfilter,Paolo Veneri,Stephan Visser and YingYin Wu.Our thanks also goes to Eric Reese for his support in the design and facilitation of the peer-to-peer wor

27、kshop and international forum that contributed to the findings of this project and to Pedro Marques of INGENIO(joint research centre of the Spanish National Research Council and the Universitat Politcnica de Valncia)for his insights into experimental governance.The OECD wishes to extend its thanks t

28、o DG REGIO Unit G Smart&Sustainable Growth and Programmes Implementation and in particular,Ramunas Linartas and Catherine Wendt.Special thanks are extended to Peter Berkowitz of DG REGIO Unit B for launching Phase 1 of the Regions in Industrial Transition initiative,as well as his continuous support

29、 for the pilot regions.Many thanks also to Pilar Philip for her support in preparing this publication,to Roxana Glavanov and Yingyin Wu for their work on the cover,to Andrew Brenner and Miriam Prier for editing the case studies,to Yingyin Wu for the case study formatting,and to Eleonore Morena,who e

30、dited and formatted the final manuscript.5 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Table of contents Foreword 3 Acknowledgements 4 Executive Summary 8 Key messages 9 1 Governance and policy experimentation for industrial transition:Insights and considerations 11 Policy insights on experiment

31、ation for industrial transition 11 A synthesis of recommendations 16 Notes 17 2 Insights into the governance of regions in industrial transition 19 Introduction 20 Regions and industrial transition:A brief overview 20 Why help regions in industrial transition succeed 27 Advancing industrial transfor

32、mation through experimental governance and policy making 31 Conclusion 33 Annex 2.A.The EC-OECD Pilot Action on Regions in Industrial Transition 34 References 35 Notes 37 3 Towards a governance and action framework for industrial transition 39 Introduction 40 Dimension 1:Framework conditions for ind

33、ustrial transition 41 Dimension 2:Strategic programming,implementation and evaluation for industrial transition 43 Dimension 3:Using stakeholder engagement to advance industrial transition 47 Dimension 4:Advancing innovation and innovation diffusion with a challenge-oriented approach 48 Dimension 5:

34、A broad approach to building skills for the future of work 53 Dimension 6:Helping SMEs and entrepreneurs build innovation capacity to advance industrial transition 57 Dimension 7:Expanding on a sustainable and just industrial transition 61 Dimension 8:Fostering inclusive growth in industrial transit

35、ion by reducing barriers to economic inclusion 65 Dimension 9:Smart specialisation strategies and their intersection with industrial transition and experimentation 69 Conclusion 72 6 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 References 73 Notes 75 4 A practitioners toolbox for action to advanc

36、e industrial transition 77 Introduction 78 A policy lever toolkit to advance industrial transition 78 Policy levers for Dimension 1:Framework conditions 79 Policy levers for Dimension 2:Strategic programming,implementation and evaluation 80 Policy levers for Dimension 3:Stakeholder engagement 81 Pol

37、icy levers for Dimension 4:Innovation and innovation diffusion 82 Policy levers for Dimension 5:Jobs and skills 84 Policy levers for Dimension 6:SMEs and entrepreneurs 86 Policy levers for Dimension 7:A just transition to carbon neutrality 88 Policy levers for Dimension 8:Inclusive growth for indust

38、rial transition 90 Policy levers for Dimension 9:Smart specialisation 91 Towards successful policy experimentation:An experimentation checklist 93 The policy experimentation for industrial transition checklist 93 References 96 5 Overview of the High Impact Actions 97 Introduction 98 Section 1:HIA su

39、mmary 98 Section 2:HIAs overviews and lessons learned 100 Note 118 FIGURES Figure 2.1.Regional disparities in green jobs within countries 28 Figure 2.2.Regional disparities in national government trust,2021 30 Figure 2.3.Three dimensions of experimental governance for regional innovation policy maki

40、ng 32 Figure 3.1.Framework dimensions to industrial transition 40 Figure 3.2.Primary steps in a back casting process in the challenge lab 51 Figure 4.1.Framework dimensions to industrial transition 78 TABLES Table 5.1.Summary of HIAs approved for the pilot regions and countries 98 BOXES Box 2.1.What

41、 is a region in industrial transition?21 Box 2.2.Piedmont,Italy:The Unified Strategy Document or DSU 23 Box 2.3.Categories of innovation activity 26 Box 2.4.Findings from the OECD scoping paper on“Understanding and tackling the territorial drivers of trust in government”30 Box 3.1.Objectives and ind

42、icators for multi-dimensional monitoring and evaluation 46 Box 3.2.Using a challenge-oriented approach to enhance regional innovation capacities in Wallonia,Belgium 50 Box 3.3.The Challenge Lab North Middle Sweden 51 Box 3.4.Experimenting to build a skilled management workforce in the Centre-Val de

43、Loire region,France 54 Box 3.5.Accelerating the digital transition of traditional industrial companies in Hauts-de-France 56 Box 3.6.Experimenting with a new funding model for innovation in East and North Finland 58 7 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Box 3.7.Using a new governance app

44、roach to broaden the innovation base in Slovenia 59 Box 3.8.Using co-creation to advance industrial transition in Lithuania 62 Box 3.9.Using a new concept to promote sustainable industrial parks in the Grand Est region,France 64 Box 3.10.The Greater Manchester Good Employment Charter 66 Box 3.11.Adv

45、ancing industrial transition through a societal innovation approach to industrial transition in Cantabria,Spain 68 Box 3.12.Examples of smart S3 models inspired by experimental policy action in regions in industrial transition 70 Box 3.13.Using experimentation to build capacity for smart specialisat

46、ion 72 Follow OECD Publications on:http:/ REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Executive Summary Among OECD member countries,per capita income gaps have declined over the past 20 years,however,gaps between the wealthiest and poorest regions(TL3)within many countries have grown.In 2022,70%

47、of the OECD population lived in countries where regional income inequality was growing.This is of particular relevance for residents of regions in industrial transition,which tend to have lower GDP per capita than national averages,experience low GDP growth and have lower productivity levels.Industr

48、ial transition has directly affected regional labour market opportunities and productivity for decades.For example,in North East England the number of manufacturing sector jobs fell by 51%between 1996 and 2022.In the United States,75%of the workers in the Rust Belt were employed in the steel,automot

49、ive and rubber industries in 1950 but only 55%in 2000,and in Germanys Ruhr area,the substantial decline in the manufacturing industry from 1964 to 2014 was only partially offset by an increase in service sector jobs.Indeed,in 2020 the Ruhr area still suffered from significantly above-average unemplo

50、yment levels 10.1%versus 6.0%in the country and a weak knowledge-intensive economy.While inequalities in regional GDP per capita in part reflect differences in industrial structures,as noted in the OECD Regional Outlook 2023,in 2019,around 25%of productivity differences across regions within OECD co

51、untries were due to differences in productivity within the same sectors,highlighting untapped potential to boost productivity,and in turn,income.It is well-established that industrial transition processes can be supported through innovation.Labour-augmenting innovation can boost productivity levels

52、in industrial regions,creating new job opportunities and wages,and preventing such opportunities from being concentrated in certain,often metropolitan,regions.This may explain why innovation-based activities have been the focal point of most industrial transition initiatives in recent years.Yet,such

53、 initiatives have tended to place a heavy emphasis on research and development(R&D)and technology-based innovation,which may provide an imperfect solution for regions in industrial transition,which typically have specific development characteristics.For instance,such regions frequently have an indus

54、trial heritage and a solid economic base that can be built upon,but must also contend with a business environment that is dominated by micro,small and medium enterprises.They also grapple with socio-economic and well-being outcomes that tend to be below national averages.Poor economic performance ov

55、er time can also be a contributing factor to declining trust in government,which can affect democratic outcomes.The persistence of challenges faced by regions in industrial transition suggests that policy makers may need to reconsider the pre-conditions required to support effective industrial trans

56、formations,and to what extent new governance arrangements could help ensure their successful execution.This report highlights the value of applying an experimental approach to governance arrangements and policy design when addressing industrial transition.It shows that experimentation in policy and

57、programme design can help policy makers help generate new ideas,and test innovative approaches to the industrial transition,as well as learn from and build on successes and failures.Furthermore,it underscores the importance of foundational governance arrangements including framework conditions,strat

58、egic programming,and stakeholder engagement being in place in order to accomplish transition objectives.9 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Key messages It is essential to recognise the broader societal impacts of regional industrial transitions There is no single definition of a regio

59、n in industrial transition.However,they are often former industrial or manufacturing powerhouses,tend to perform below the national average across a variety of socio-economic and well-being indicators,including GDP growth and GDP per capita as well as unemployment,tertiary education attainment,and l

60、ife expectancy.Long-term economic decline,poor short term labour market outcomes,and unequal access to quality public services all characteristics of regions in industrial transition are contributing factors to territorial differences in trust in government.The low level of institutional trust that

61、these factors can generate,in turn,is often revealed in voting patterns that may affect democratic outcomes.This makes it imperative that regions in industrial transition not only carry out a successful industrial transformation,but do so in a way that imposes minimal costs to communities.Industrial

62、 transition is not linear and requires a systemic or integrated approach to be successful.Creating space for regions in industrial transition to apply a broad definition of innovation to their programming and funding opportunities is key to success.Frequently,the industrial and administrative profil

63、e of these regions does not lend itself to a heavy emphasis on R&D or technology-driven innovation.They could gain more by advancing a combination of technological,business model,societal and/or social,and public sector innovation.Using an experimental approach to governance and programming can offe

64、r scope to test new funding models or support changes in business or production models that contribute to economic and sustainability goals in tandem.This was the case in East and North Finland,for example,where the regions experimentation with a new funding mechanism helped to expand the scope of i

65、nnovation among enterprises in the regional forestry value chain.Ideally,such policy experiments should be given sufficient time to bear fruit,so that policy makers and other stakeholders can properly evaluate the potential merits of scaling the initiative up or out.While innovation and innovation d

66、iffusion are key drivers of industrial transition,policy makers are more likely to succeed with interventions that not only advance innovation,but also support at least one or two other basic transition dimensions:such as jobs and skills,SMEs and entrepreneurship,a just transition to carbon neutrali

67、ty,inclusive growth or smart specialisation.Successful transition requires bringing a variety of public and non-governmental stakeholders on board and then aligning the various objectives,priorities and initiatives among these groups,and particularly among policy sectors,with overarching industrial

68、transition aims.It also requires synchronising the objectives and priorities of different levels of government.Bringing a wide variety of stakeholders into the process of designing and implementing industrial transition initiatives can help to build ownership across sectors and among levels of gover

69、nment,while also generating goodwill and strengthening political support for experimentation.In the Greater Manchester region(U.K.),for example,the Good Employment Charter initiative included an extensive co-design and co-implementation process with local employers to help define a collective vision

70、 of good employment.The process encouraged a wide range of local businesses to adhere to the Charters criteria and improve their own employment practices,thereby supporting economic inclusion across the region.However,in order for stakeholders to collaborate effectively on such initiatives,cross-sec

71、toral and inter-governmental co-ordination mechanisms need to be in place.Smart specialisation supports industrial transition by helping policy makers focus on the natural(economic)endowments of their regions,building on these,and using them to focus their development and investment activities.Exper

72、imental approaches and smart specialisation 10 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 can dovetail clearly in policies targeting support for industrial SMEs,and advancing sustainability and inclusivity aims.For example,in the Grand Est(France),the experimentation and lessons learned from th

73、e regions Industrial Parks of the Future project not only fed and improved the regions S3 but also strengthened the tools and systems used for the sustainable and smart management of natural resources and energy systems.Industrial transition initiatives can support higher level strategies and polici

74、es,for example national and regional development strategies,innovation policies and smart specialisation strategies,as well as supra-national frameworks(e.g.the European Commissions Cohesion Policy programming).To do so,however,industrial transition policy makers must ensure that the links among the

75、se higher-level frameworks and the objectives of industrial transition are strong and that the actions are coherent and mutually reinforcing.Governance matters in industrial transition,as does embracing governance and policy experiments.Effective framework conditions,good strategic programming plann

76、ing practices,well-designed monitoring and evaluation frameworks are foundational dimensions of the governance of industrial transition.With regards to experimental approaches to industrial transformation,however,a critical pre-condition appears to be effective stakeholder engagement.As a multi-dime

77、nsional and collaborative process,industrial transition depends greatly on flourishing networks and the social capital of its various actors from public and private sector representatives to academia and civil society organisations.Bringing stakeholders on board at the beginning of the programme des

78、ign process,creating incentives for active participation throughout the process,and obtaining their feedback at the end not only contributes to success but builds ownership and mitigates the possibility of failure.In the North Middle Sweden region,for example,the Challenge Lab initiative,which aimed

79、 to explore the role of hydrogen in advancing the circular and low-carbon industrial transformation,succeeded in part thanks to its proactive outreach to relevant stakeholders at the projects outset.Strong financial and non-financial incentives for stakeholders to participate in each of the initiati

80、ves components also contributed to its success.When policy makers have room to adjust governance arrangements(e.g.funding mechanisms)or project implementation ideas(e.g.shifting targeted beneficiaries)the results may be stronger,or more readily apparent.Such is the value of experimentation it can cr

81、eate a delineated policy space that is also timebound,and geographically contained,so that policy makers can test their activities and adjust them in a process of learning by doing,in order to more effectively meet their aims.11 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 For regions in industri

82、al transition,traditional policy solutions for example,pursuing technology-based innovation and research and development(R&D),channelling resources to large industrial firms,and designing and implementing actions in a sector-driven and/or top-down manner have not always yielded the necessary results

83、.This is evident in that industrial transition-related challenges,such as generating inclusive growth and improving regional well-being,have not disappeared despite past or present policy actions.This leads to the conclusion that the mechanisms being used to manage industrial transition from governa

84、nce arrangements to programming design and implementation may need to be revisited and recalibrated or alternatively complemented or replaced with a new approach.The OECDs work with the European Commission and the regions and countries in industrial transition that participated in the European Commi

85、ssion Pilot Action on Regions in Industrial Transition,beginning in 2018,shed light on how territories can improve their industrial transition processes.One of the lessons learned from the 2018-19 phase of the project was the possibilities offered by experimental governance as a means of managing po

86、licy complexity.Experimental governance,which embeds learning-by-doing and trial-and-error processes into the policy design and implementation cycle,can help policy makers identify new ways of approaching the complexity of industrial transition.The High Impact Actions(HIAs)developed by the eight reg

87、ions and two countries1 that participated in the final phase of this project,from 2021-23,offer insight into how experimental processes can help territories advance in their industrial transition aims.This pilot action in and of itself was experimental precisely because it encouraged the participant

88、s to take a new look at how they tackle industrial transition,the mechanisms used,and the dimensions2(e.g.jobs and skills,inclusive growth)targeted.It also supported them in the process of conceiving and implementing an experimental initiative,with relevant stakeholders learning as they went along.P

89、olicy insights on experimentation for industrial transition The experimental approaches taken by project participants in developing and implementing their HIAs3 can provide initial insights into prospective pathways for managing industrial transition differently,both in terms of the six thematic dim

90、ensions that contribute to it and overall governance approaches.These insights,moreover,open the door for further study to identify how widely experimental approaches can be used to help meet industrial transition goals and advance regional development.1 Governance and policy experimentation for ind

91、ustrial transition:Insights and considerations 12 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Frequently addressed industrial transition dimensions With respect to the six thematic dimensions contributing to an industrial transition and explored in this project(i.e.innovation and innovation diff

92、usion,jobs and skills,small and medium-sized enterprises SMEs and entrepreneurs,a just transition to carbon neutrality,inclusive growth and smart specialisation strategies S3s),the one that was most frequently addressed through the experimental activities was supporting a just transition to carbon n

93、eutrality.The focal point of the experiments undertaken in this dimension varied,however.A number concentrated on promoting or generating a circular economy,either in plastics,energy or forestry,for example,or in a specific industrial sector,such as automotive.What also varied was how the experiment

94、 was implemented:for example,in two out of the ten cases(i.e.North Middle Sweden and Wallonia,Belgium),a challenge-based(or mission-oriented)approach was adopted.Advancing innovation and innovation diffusion was another priority area,be it in traditional or artisanal sectors populated by small and m

95、icro-enterprises or family firms in remote or rural communities or rather in more R&D-intensive sectors such as hydrogen.Some of these initiatives(e.g.in Cantabria,Spain)experimented with a broader definition of innovation one encompassing production and process innovations,for example including as

96、a means to reduce costs and increase competitiveness.The concept of societal innovation was also explored and embedded into the innovation dimension.In such cases,the experiment tested whether it is possible to address broader social challenges(e.g.outward migration or general demographic decline,cl

97、imate change,the rising costs of energy)that can accentuate industrial transition challenges.One approach was to introduce innovation into less innovative firm ecosystems(e.g.in remote or rural areas or where the firms were predominantly micro-and small enterprises).At times,however,innovation and i

98、nnovation diffusion were also embedded in other dimensions,such as inclusive growth or a just transition to climate neutrality(e.g.in Cantabria in Spain,Grand Est in France and North Middle Sweden).A third popular dimension for applying an experimental approach was jobs of the future and skills.Here

99、 again,the angle and approach varied.In one instance,in the Great Manchester region,United Kingdom,the focus was on ensuring better quality jobs through soft tools,such as a carrot-and-stick incentive structure to encourage employers to lift their standards in terms of job quality.In Hauts-de-France

100、,France,the focus was on generating incentives to encourage digital upskilling in SMEs,thereby helping them to build their capacity and prepare to carry out jobs of the future.In Centre-Val de Loire,France,the emphasis was on building a stronger managerial talent pool.In all cases,however,the interv

101、entions focused on employers and building their capacity to ensure an appropriately skilled and motivated workforce to support the industry needs of a transitioning region.The other three dimensions SMEs and entrepreneurship,inclusive growth and smart specialisation were part of several HIAs but the

102、y were less frequently the driving objective.Supporting SMEs and entrepreneurship was a thread that ran throughout almost all of the HIAs.This may reflect the firm ecosystems of the participants.It may also reflect the fact that SMEs(as well as micro-enterprises)and start-ups were the categories of

103、firms that needed the greatest level of support in order to be able to contribute effectively to the industrial transition.In this regard,it is notable that in few to no cases were larger firms targeted to participate in the experiments and,in some cases,when they were,the larger regional firms were

104、 not interested.With respect to S3s,in many cases,the HIAs were aligned with the regional(or national,if applicable)S3.Whether or not HIAs were designed to advance the relevant S3 is less clear,as is the impact that the experimental initiatives will have on the S3s.Thus,while an experimental approac

105、h to S3 may not have been integrated into the initiatives,the experiments clearly supported dimensions used to advance industrial transition processes.That they do so also can support the value of experimentation with respect to the European Commissions request that S3s follow a series of enabling c

106、onditions in the 2021-27 programming period for Cohesion Policy,among which are actions to manage industrial transition.4 This could be taken a step further with respect to ensuring effective entrepreneurial discovery processes,13 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Enabling Condition 4:

107、Effective functioning of entrepreneurial discovery process.It is not unrealistic to expect that the lessons learned through stakeholder engagement processes linked to experimentation could also build capacity for entrepreneurial discovery processes.Finally,many of the HIAs helped reinforce or increa

108、se the variety of firms involved in innovation and/or innovation diffusion,which aligns with Enabling Condition 5:Actions necessary to improve national or regional research and innovation systems.The diversity of dimensions and actions taken highlights the flexibility of experimentation.Specifically

109、,it can help address more than one thematic dimension of industrial transition at once,whether intentionally or not.An average of four thematic dimensions were addressed in each HIA.There is hope,then,that experimentation is a naturally supportive methodology for taking a more holistic or integrated

110、 approach to programming for industrial transition and that experimental initiatives may advance more than one transition objective.The role of governance mechanisms in experimental processes The full pilot action brought to the fore the role that governance arrangements can play in advancing indust

111、rial transition.Now,in 2023,through the HIAs,the work reveals the importance of having appropriate governance arrangements for the experiment itself.Planning the experiment Planning and setting up the experiment was often challenging for a number of reasons.Many of the experiments were designed just

112、 before the start of the COVID-19 pandemic.In several if not all cases,this led to a delay in launching the experiments and,in other cases,it required a full shift in an experiments design.These delays and design adaptations,however,did not appear to affect the experiments objectives.Another notewor

113、thy feature of the design phase was that while some HIAs initially targeted one category of firms,such as larger SMEs or SMEs more generally,these were not necessarily the firms that ultimately took part in the experimental process.Rather,on occasion,it was start-ups or micro-enterprises that showed

114、 greater interest in the experiment.Ensuring that HIAs are appropriately targeted to meet their beneficiaries needs is fundamental and,encouragingly,the experimental approach allowed for the regional project teams to quickly adapt to this new set of beneficiaries.This highlights that while there sho

115、uld be a commitment to the objectives pursued and the transition dimension being worked on,there should also be flexibility both practical and in terms of mindset with respect to how such objectives should be pursued.Framework conditions The need to triangulate between a commitment to clear objectiv

116、es and flexibility in project design and implementation was also a reality that was imposed by the framework conditions within which each HIA had to operate.In at least one case,regulatory frameworks would normally have made the experiment impossible.East and North Finland was able to work around th

117、is because of the experiments funding mechanism(a grant from the European Commission).Administrative burdens which are frequently aggravated by legislation or regulations at a national level are a common area that many of the HIAs helped smooth over.They did so by finding partners with whom to imple

118、ment the experiment,as in the case above,or by simplifying procedures or processes over which they had control.Of particular relevance here is the fact that all of the institutions through which the HIAs originated were national,regional or county government bodies.Thus,while there were framework ob

119、stacles,the participants found ways to adapt and work within these.For example,in one national case,the administrative burden for accessing funds available or channelled through the government was deemed too high to make the experiment truly feasible,which resulted in a partner being identified who

120、14 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 could manage the funding aspect.Occasionally,this has already led to more lasting relevant change.For example,thanks to the East and North Finland experiment,a new way to fund SMEs with higher technology readiness level projects is in place.Human an

121、d financial resources Ensuring that experiments are appropriately resourced was frequently voiced by participants as a success factor.Dedicated staff ranging from an individual to a full team played a key role in supporting each HIA.Teams were typically guided by a decisive project leader and/or pro

122、ject manager as well as internal and/or external experts with specialised knowledge of the industrial transition dimension(s)targeted by the HIAs.In addition to the importance of policy makers having the necessary skills for project design and implementation,the experiments shed light on the fact th

123、at having a clear assignment of tasks and responsibilities,particularly when project teams are composed of individuals from different organisations,is another component of effective human resource support.In the case of the HIAs,clear responsibility assignment supported more co-ordinated action.Prop

124、erly funding the experiment seems self-evident.However,there are two aspects to this.The first is funding the institutional structure supporting the experiment,i.e.the individual or team mentioned above,along with elements that may be necessary to ensure implementation,e.g.putting surveys out in the

125、 field,hiring experts,travelling to more remote areas,etc.The second is providing funds as an incentive for firms to participate in the experiment.In many HIAs,implementation depended on putting out a project call to firms to participate in the experiment,for which financial incentives were part of

126、the draw for participation.Non-financial incentives were also either explicitly or implicitly used to encourage participation(both explicitly,for instance by promising potential beneficiaries a more streamlined process for accessing funds,as well as implicitly,for instance by offering potential bene

127、ficiaries the chance to learn about ways in which they could improve their business performance).Measuring performance One governance area that was not as well developed in the HIAs was monitoring and evaluation frameworks.In some cases,the implementing region or country would establish clear monito

128、ring and evaluation mechanisms for the projects that supported the experiment.However,it was rarer to see a monitoring and evaluation framework developed for the experiment itself.This may either reflect a gap in the experiments design or an oversight.Measuring an experiments performance is an impor

129、tant factor in determining its success and whether it should be scaled up.Indeed,it is generally important to take a moment in the design process and establish the criteria that will be used to undertake an ex post evaluation of the experiment when it has reached the end of its lifecycle in order to

130、 determine success and scalability.This was frequently missing.Supported risks An important element in the governance of an experiment,and one which,notably,is not frequently discussed,is the concept of supported risks.Experimentation is inherently risky.Just as experiments can succeed,they can also

131、 fall short of the mark or fail completely.This may be one reason behind their often-limited use.There are ways to manage the risk factor of experimentation and,while these were not explicitly discussed or explored with the project participants,they bubbled up through different elements that shaped

132、this project.First,it is important to ensure that the experiment has political support as well as support from other governmental and non-governmental stakeholders.The more agreement there is around the experimental initiative,the greater its political legitimacy.Second,when designing the experiment

133、,it is important to draw on the collective expertise,knowledge and resources of a diverse range of relevant stakeholders in order to guide the identification of more innovative and effective solutions.By doing so,the knowledge and network supporting the experiment is larger and there is more social

134、capital 15 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 built around it.Third,highlighting how the experiment can support meeting the goals of higher-level strategies or other sector policies can resonate with other sectors and,at a minimum,gain their support for the proposed concept.Finally,shar

135、ing the results of a successful experiment as broadly as possible can help credibility for future experimental approaches and promote learning,which can encourage further experimentation.Stakeholder engagement While stakeholder engagement is frequently embedded into discussions of governance arrange

136、ments or practices,the extraordinarily large role it played in each of the HIAs makes it important to highlight it separately.No participant worked on their experiment alone.They relied heavily on deep and ongoing stakeholder engagement.Stakeholders could be broadly classified into two groups:i)othe

137、r government stakeholders,usually at the same level of government but active in other sectors that can influence industrial transition;and ii)external stakeholders,including the private sector,civil society and non-governmental organisations,academia,thematic experts,business or trade associations,t

138、hose implementing individual projects supported by the experiment,and citizens.In most,if not all cases,stakeholder engagement began early in the experimental process.Internally,stakeholder engagement and communication generally relied on formal or informal conversations with peers or on other co-or

139、dination mechanisms that were established to support the experiment,such as steering and working groups,which frequently mixed internal and external stakeholders.Externally,stakeholder engagement and communication often started with a mapping of relevant actors,followed by a direct consultation,be i

140、t through surveys,interviews or other means.This often gave the region an idea as to just how much knowledge and awareness there was regarding industrial transition,its challenges,the dimensions that could help advance it and why engaging in innovation was important.This information helped feed the

141、articulation of experiments objectives and ensure they were realistic but still ambitious.It also helped policy makers understand the actual capacity of stakeholders to:i)engage with such a project;and ii)to engage with industrial transition overall.The stakeholder engagement initiatives employed in

142、 the different experiments also helped set objectives and priorities,and better target the audience for the experiment.Stakeholders were generally involved in the experiments design and implementation.This depth of engagement engendered other innovation opportunities,built new partnerships and helpe

143、d give project teams an idea regarding scalability.In two cases(i.e.North Middle Sweden and Wallonia),the entire experimental approach was based on stakeholder engagement;in the other cases it was a critical component.This heavy emphasis on engagement is another reason why it is important to have su

144、fficient resources when undertaking an experiment.It requires a significant amount of co-ordination of different sets of actors as well as expertise in different engagement techniques.This latter point is fundamental as the success of an engagement process can depend on its design and a good underst

145、anding of how engagement works,which tools to use and when,and how to build the necessary capacity.It is also valuable for avoiding consultation fatigue and disillusionment.Potential to scale up The potential for scaling the experiments up(to other places)or out(to other sectors)was considered an in

146、dicator of whether the experiment successfully introduced a new policy or initiative to support industrial transition.In almost all cases,scalability was identified,mostly scaling up potential and in some cases scaling out.Scaling,however,will clearly require sufficient resources,time and political

147、support.It is also important to recall that determining the outcomes,and ideally the impact,of an experiment on the challenges faced by a region in industrial transition takes time and so a final decision on scaling cannot be made from one day to the next.In addition,the experiments in question ran

148、for a relatively short period(approximately 12 months)which will have affected project outcomes and,by extension,scaling 16 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 decisions.Political change may also influence whether an action is continued or scaled and is not to be forgotten.A synthesis of

149、 recommendations Below are a series of simple recommendations with respect to experimentation for industrial transition arising from the work.Most are targeted to policy makers,regardless of whether they are regional or national,with a number specifically for higher levels of government and the Euro

150、pean Commission.Considerations for policy makers Experimenting is a useful tool for managing industrial transition:It will require supportive framework conditions,sufficient human and financial resources,well-developed planning,monitoring and evaluation mechanisms and a willingness and capacity to e

151、ngage with stakeholders.If these are not in place,the experiment is unlikely to work or provide any relevant insights for policy makers.Pay attention to scope and scale:While a conclusion of this work is that experiments can be scaled up and/or out and can be a means to support industrial transition

152、s elsewhere,the experiences shared in this report were limited to single experiments in one place.They show that experimentation can work but whether an experimental approach would be appropriate for all initiatives being used to advance transition is less certain.Establish clear,realistic but ambit

153、ious goals:This is fundamental to any experiment,as it is the basis against which success will be measured and the future of the experiment will be decided.Moreover,clear goals not only provide direction but can also help to bring together stakeholders around an initiative by creating a shared visio

154、n.They can also facilitate effective communication about the experiment,which can help to garner public support for and interest in the results of the initiative.Understand human and financial resource needs:When designing the experiment,it is important to take stock of the expertise that will be ne

155、eded to ensure implementation and where it can be found.It is just as important to identify the financial resources necessary,the mechanisms that can ensure their availability and the merits of providing financial incentives to prospective participants.Build monitoring and evaluation frameworks:Moni

156、toring the experiment is a continuous process and evaluating its effect can take time.Performance measurement frameworks,however,should be determined at a projects outset,with appropriate indicators that have been determined following effective stakeholder consultation and are backed by readily-acce

157、ssible data.Be willing to take risks and have a flexible mindset:The risk of failure is inherent to any experiment.Experiments do not always work out as planned and it may be necessary to shift and adjust the experiment in response to rapidly changing circumstances.This need not lead to failure and

158、it may also,in fact,lead to success.However,any readjustment to the experiment should be conducted in close consultation with relevant stakeholders while ensuring that a clear line of sight on the pre-agreed objectives is maintained throughout.Be able to actively engage with stakeholders:Engagement

159、is a capacity in and of itself be it on the part of the engager or the stakeholders.Engagement is also a commitment to act based on its outcomes and should be part of the full design,implementation and evaluation process of any experiment.This includes being transparent with stakeholders about what

160、has or has not worked while communicating successes,however modest or incremental.17 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Considerations for higher levels of government Experiments are an investment that can pay dividends:A successful experiment for industrial transition can build governm

161、ent capacity,spread innovation,advance inclusive growth and contribute to achieving a range of strategic and sector objectives(e.g.in climate,digitalisation,energy,labour markets,skills),including the priority objectives linked to EU Cohesion Policy.Moreover,experiments are a cost-effective way of g

162、enerating information on whether a policy intervention can achieve a specific objective,and/or whether it is desirable or even possible to scale up or out.Use experiments to reconsider framework conditions:Often,framework conditions and administrative processes hold back innovation and innovative go

163、vernance.Since experiments are limited in time and scope,policy makers can use their results to assess the potential benefits of adjusting framework conditions(such as laws or regulations),as well as the risks of doing so.For instance,experimentation can provide pathways to test whether minor legisl

164、ative or regulatory adjustments for the express benefit of specific groups,such as micro-and small enterprises or start-ups,may promote their participation in the economy.Such experimentation can be done,for example,by:o Working with a region wishing to implement an experiment where specific framewo

165、rk conditions or administrative burdens have been perceived by stakeholders as negatively affecting success.o Establishing a defined period of time or a specific funding opportunity to which framework or administrative requirements could be adjusted for a targeted group of potential project benefici

166、aries while measuring the results.Considerations for the European Commission Tackling territorial divides improves trust in government:Further analysis of and support for regions in industrial transition can lay the foundations for tackling the geography of discontent,which in turn can help to impro

167、ve trust in government.Welcome experimentation as a viable lever for policy design and implementation:Continue to promote and facilitate experimentation that reinforces the various dimensions supporting industrial transition,for example by:o Establishing regulations that support(or do not discourage

168、)experimentation as criteria for responses to innovation project calls funded by EU Cohesion Policy or other funds.o Emphasising the need for and facilitate the development of robust monitoring and evaluation mechanisms to track the effects of policy experiments effects,including the core challenges

169、 facing regions in industrial transition(e.g.relatively high levels of unemployment,low gross domestic product,low labour productivity,low life expectancy).Notes 1 The regions are Cantabria(Spain),Centre-Val de Loire(France),East North Finland(Finland),Grand Est(France),Greater Manchester(United Kin

170、gdom),Hauts-de-France(France),North Middle Sweden(Sweden)and Wallonia(Belgium).The countries are Lithuania and Slovenia.2 The nine dimensions are divided into two sets.One set is for governance arrangements that are particularly important to industrial transition and experimentation:framework condit

171、ions;strategic 18 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 programming,implementation and evaluation;and stakeholder engagement.The second set is dedicated to thematic dimensions that support industrial transition,namely:innovation and innovation diffusion;jobs(of the future)and skills;SMEs a

172、nd entrepreneurs;a just transition to carbon neutrality;inclusive growth;smart specialisation.3 Chapter 5 of this report highlights the main findings and provides links to case studies of each HIA.4 In the 2021-27 programming period for Cohesion Policy,the European Commission requested that S3s be u

173、pdated and respond to the seven“enabling conditions”:i)Up-to-date analysis of bottlenecks for innovation diffusion,including digitalisation;ii)Existence of competent regional/national institution or body responsible for the management of the smart specialisation strategy;iii)Monitoring and evaluatio

174、n tools to measure performance towards the objectives of the strategy;iv)Effective functioning of entrepreneurial discovery process;v)Actions necessary to improve national or regional research and innovation systems;vi)Actions to manage industrial transition;and vii)Measures for international collab

175、oration.19 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 This chapter discusses industrial transition from the perspective of its governance and policy implications.It highlights a set of challenges associated with industrial transition today,such as concentrated declines in industrial activity an

176、d falling standards of economic and social well-being.In light of these,the chapter emphasises the need for robust governance mechanisms and a place-based policy approach in order to support places undergoing industrial transformation.It also explores the role of experimental governance and policy a

177、rrangements in helping to facilitate successful industrial transition initiatives.2 Insights into the governance of regions in industrial transition 20 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Introduction Industrial transition is not a new phenomenon.Societies have undergone seismic transfor

178、mations as a result of innovation many times in the past.The invention of the printing press in the 15th century,the industrial revolution of the late 18th and early 19th centuries,the Ford-inspired technologies of mass production in the 20th century and the digital and artificial intelligence(AI)re

179、volutions of the 21st century are all relevant examples.Each of these shifts has affected regions and affected them differently,creating economic winners in certain areas while others are left behind.What makes industrial transition today different,and potentially more challenging to deal with than

180、in the past,has been the rise of an increasingly uncertain global environment.In a global economy that is far more interconnected than it has ever been,all regions have been confronted by challenges that have been borne,at least in part,of rapid industrial change.Over the past three decades,the worl

181、d witnessed striking demographic shifts,including large waves of migration,as well as dramatic changes in how and where people work.Regions have also had to contend with a rise in intense shocks or crises,many of which have been difficult for policy makers to predict with confidence.Such crises incl

182、ude the 2008 Global Financial Crisis,the COVID-19 pandemic,the 2021-23 global inflation surge,an increase in the severity and frequency of climate change-induced natural disasters and rising geopolitical tensions(e.g.between China and the United States)or even war(as in the case of Russias ongoing w

183、ar of aggression against Ukraine).The result is a global context that is increasingly complex and unpredictable.It changes rapidly,generating uncertainty for government and citizens,who need to be flexible and agile in order to quickly adapt to new circumstances.Failure to adapt and to support parti

184、cularly exposed communities risks increasing inter-regional and intra-regional inequalities.While all regions are confronted with todays new-found global complexity,regions in industrial transition may experience its negative effects more acutely.In part,this may be due to greater difficulty in shif

185、ting or adjusting their industrial bases rapidly enough or effectively enough to take advantage of the new economic opportunities an industrial transition can bring.Reconsidering existing governance and policy mechanisms can help regions in industrial transition transform their industrial base to on

186、e that better generates inclusive,sustainable regional development and greater citizen well-being.It can also help them develop the resilience to respond more effectively to uncertain global economic headwinds.This chapter builds on insights emanating from the OECDs 2018-19 work on regions in indust

187、rial transition.After a brief introduction to the concept of industrial transition,along with its links to innovation,the chapter takes a look at why policy makers should support regions in industrial transition.Building on the practical experience of the eight regions and two countries in industria

188、l transition that are featured in this report,the chapter then considers the conceptual and practical preconditions of regional development and governance that are needed for industrial transition initiatives to succeed.Conceptual elements include the value of a place-based approach to industrial tr

189、ansition,as well as an integrated approach to innovation diffusion that aligns governmental stakeholders across objectives,priorities and initiatives.Practical elements include ensuring that appropriate multi-level governance arrangements are in place or can be introduced before industrial transform

190、ation initiatives are attempted.The chapter concludes by considering how taking an experimental approach to the transition can act as a spark that catalyses a successful industrial transformation.Regions and industrial transition:A brief overview Twenty-first-century experience with industrial trans

191、ition for example in Germany,the United Kingdom and the United States highlights the impact of major industrial transformations directly on a regions labour market opportunities and productivity.It also reveals the potential for such processes to negatively affect the overall well-being and quality

192、of life of a regions residents.For example,in North East England 21 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 (United Kingdom),manufacturing sector jobs decreased by 51%between 1996 to 2022(ONS,20221).The United States(US)Rust Belt region1 employed 75%of workers in the steel,automotive and rub

193、ber industries in 1950 and only 55%in 2000(Alder,Lagakos and Ohanian,20142).In the Ruhr area in Germany,the substantial decline in the manufacturing industry from 1964 to 2014 was only partially offset by an increase in service jobs(IAT/Wuppertal Institut fr Klima,Umwelt,Energie,20213).In 2020,the r

194、egion still suffered from significantly above-average unemployment levels 10.1%in the region versus 6.0%in the country and a weak knowledge economy.Unemployment in the Ruhr city of Gelsenkirchen reached 15.6%in 2020 and,in 2019,the average disposable per capita income in the city was EUR 17 015 less

195、 than half of the average reported in Heilbronn,Germanys highest-earning city(EUR 42 275)(Seils and Pusch,20224;Hassink and Kiese,20215)As noted in the OECD Regional Outlook 2023(forthcoming6),raising productivity growth is an important vehicle for reducing income inequalities within and across regi

196、ons and territories.There is also significant potential for low-productivity regions to boost productivity growth in all economic sectors,including the industrial sector.In 2019,close to 25%of productivity differences across regions within OECD countries were due to differences in productivity withi

197、n the same macro-sectors(OECD,forthcoming6).Labour-augmenting innovation can lift productivity levels in lagging,industrial regions,thereby creating new job opportunities and wages,and preventing such opportunities from being concentrated in certain,often metropolitan,regions(OECD,forthcoming6).For

198、such efforts to be successful,however,it is essential for policy makers to build on a regions existing strengths and past industrial legacy,without losing sight of the future.Making industrial transition work Industrial transition needs to be understood in the context of certain development challeng

199、es that affect some territories but not others and are a product of historical economic legacies.Regions in industrial transition are defined by their tendency to demonstrate two or more common characteristics that generally place them among the lower tier of performance in their own countries(Box 2

200、.1)(OECD,20197).Furthermore,they are generally regions that have been,and may still be,heavily reliant on extractive,resource-intensive or heavy industrial manufacturing industries.They may have well-established capabilities and deep industrial knowledge in important sectors.However,they are also ty

201、pically expected to modernise,adjust or transform their industrial composition.This can include adapting their existing sectors as well as building up resources and expertise in new or emerging sectors relevant to their industrial structure to drive economic growth(OECD,20197).Importantly,they are n

202、ot necessarily poor or disadvantaged regions but may risk tipping into this category if they fail to adjust to changing circumstances.They may also suffer from institutional weaknesses,either in terms of governance or capacity.Research has shown that the efficacy of innovation policies at the subnat

203、ional level is often influenced by institutional quality,which can include policy-making capacity and levels of corruption(McCann,20238).Box 2.1.What is a region in industrial transition?There is no single definition of a region in industrial transition.However,it typically shares two or more of the

204、 characteristics highlighted below:A lower-than-average per capita gross domestic product(GDP)as a percentage of the national average.An average annual GDP growth of 1%or less.A lower-than-national-(or EU)-average level of population with tertiary education.22 REGIONS IN INDUSTRIAL TRANSITION 2023 O

205、ECD 2023 A rising unemployment rate.A lower-than-national-average life expectancy.Performance in the middle to bottom half of OECD Regional Well-being indicators(e.g.jobs,income,environment,community,life satisfaction,housing,health,education).In regions in industrial transition,these characteristic

206、s may translate into lower-than-average incomes,a perceived and/or real lack of job opportunities,a degradation of public and civic space,a rise in petty crime and a greater reliance on government transfers.Source:Based on OECD(20197),Regions in Industrial Transition:Policies for People and Places,h

207、ttps:/doi.org/10.1787/c76ec2a1-en;OECD Well-being indicators:https:/www.oecdregionalwellbeing.org/Industrial transition is an inherently place-based concept Given the divergence from other regions in their countries that regions in an industrial transition can demonstrate,a“one-size-fits-all”develop

208、ment policy e.g.one that is applied broadly to many regions at once is likely to fall short of the mark.Rather,policy makers need to adopt a place-based approach to managing an industrial transition to promote stronger inclusive growth and well-being for the residents in a specific geographic territ

209、ory and in order to reduce inter-and intra-regional disparities.Place-based approaches assume that a territorys social,economic,environmental and institutional characteristics matter.They also presuppose that the involvement of subnational actors is important,whether solely to identify local needs a

210、nd priorities or to implement specific actions.Place-based approaches differ from traditional ones in a number of ways,including the following(OECD,20209):The policy focus shifts from an emphasis on external interventions to an approach that builds on a territorys local human,natural,financial and g

211、overnance assets.Policies are not only targeted at administrative territories but also functional economic areas that reflect real linkages across territories,including urban-rural linkages.The policy-making process no longer centres around the central government but rather focuses on establishing w

212、orking relationships between all relevant actors(including regional and local government stakeholders,as well as civil society and the private sector).The traditional“siloed”approach of developing and implementing policies in isolation is dispensed with;active efforts are made to identify and levera

213、ge synergies and complementarities across sectors.To act in concert across these areas,policy makers must be able to rely on effective multi-level governance,as getting the policy mix right requires not only identifying common objectives but also ensuring cross-sector and multi-level policy coherenc

214、e and complementarity.This means engaging and co-ordinating ideas and actions among different levels of government,different policy sectors and a variety of stakeholders in what can be a difficult conversation one that revolves around generating structural change.Success can depend to a significant

215、degree not only on the governance arrangements in place but also on their flexibility and the capacity of policy makers to adjust them where appropriate.Conceptual governance components,such as taking an integrated approach to developing and implementing transition initiatives,and more concrete gove

216、rnance components,such as making roles and responsibilities clear,ensuring sufficient resources and optimising stakeholder engagement practices,are all part of the elements that can make a transition more or less successful.23 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Industrial transition cal

217、ls for an integrated policy approach A policy approach that addresses only one of the challenges confronting a region in industrial transition has limited potential to succeed.Rather,industrial transition calls for considering and acting on a variety of areas simultaneously.Acting on jobs and skills

218、 should also support action for building innovation and innovation diffusion.Innovation policy should not neglect the importance of boosting innovation potential and capacity among small and medium-sized enterprises(SMEs)as well as entrepreneurs.Education and learning cannot be forgotten and an oppo

219、rtunity to tailor these to todays transition opportunities should not be missed,for example to advance a carbon-neutral transition and promote stronger inclusive growth and well-being for the regions residents to reduce inter-and intra-regional disparities.Given that addressing industrial transition

220、 draws on a variety of policy areas,an integrated approach,or at least an approach where policy sectors act in concert to advance the transition,may be more successful than one where individual policy areas act alone as this can generate policy fragmentation,incoherence and overlap,as well as a pote

221、ntially suboptimal use of resources.Taking an integrated approach,however,first requires bringing a variety of government sectors on board and then ensuring that the various objectives,priorities and initiatives within these sectors that could contribute to industrial transition are aligned.It is fu

222、rther enhanced when the objectives and priorities among different levels of government are also in sync.When an integrated approach to industrial transition is in place,policies related to economic development,environmental protection,social equity,well-being and other areas are all working towards

223、the same goals and objectives.Moreover,an integrated approach supports greater policy continuity and clearer guidelines for decision-making and action.It can also help to align priorities while serving as a roadmap for cross-sectoral industrial transition and innovation policy.An example of how such

224、 alignment can be generated is found in Piedmonts(Italy)Unified Strategy Document(Documento Strategico Unitario,DSU)(Box 2.2).Box 2.2.Piedmont,Italy:The Unified Strategy Document or DSU Piedmonts DSU lays out the regions development vision and objectives,including territorial,economic and social dev

225、elopment and how different regional development tools can help achieve the regions development objectives.These tools include different regional strategies,such as the Regional Strategy for Sustainable Development,the Regional Smart Specialisation Strategy(RIS3)and the regional Smart Mobility Plan.I

226、t also offers an assessment of how to make the best use of the different European Union(EU)financing streams for Piedmont,such as the Cohesion Fund Operational Programmes(specifically the European Regional Development Fund ERDF,the European Social Fund ESF and the European Agricultural Fund for Rura

227、l Development EAFRD)and the NextGenerationEU COVID-19 recovery package.Furthermore,the document also describes how regional objectives are aligned with and embedded in national,European and international policy and development visions,in particular the European Green Deal and the 2030 Sustainable De

228、velopment Agenda.Source:Based on OECD(202110),Regional Innovation in Piedmont,Italy:From Innovation Environment to Innovation Ecosystem,https:/doi.org/10.1787/7df50d82-en.The strength of Piedmonts strategic frameworks and policies to support innovation and industrial transition lies in the regional

229、governments initiatives to ensure that the various EU,national and regional strategic industrial transition initiatives are linked to one another.This is further supported by the regions proactive approach to articulating these links in an effort to identify strategic and cross-sector synergies.24 R

230、EGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Industrial transition depends on active governance arrangements Beyond taking an integrated approach,which provides a methodological foundation from which regions can approach the industrial transition,certain specific governance arrangements need to be

231、 activated in order to ensure that such transitions are as successful as possible.These include clearly assigning responsibilities for transition processes among levels of government to avoid policy overlap and duplication,allocating sufficient financial,human and infrastructural resources to the tr

232、ansition to ensure that implementation can proceed smoothly and engaging external stakeholders to improve the effectiveness,impact and value-for-money of transition initiatives.Clearly assigning roles and responsibilities can avoid policy overlap and duplication Clearly assigned responsibilities amo

233、ng different levels of government and non-government stakeholders(e.g.clusters,incubators,academia,private sector,civil society organisations)helps actors in the industrial transition process understand their role,responsibilities and what is expected of them.This minimises potential confusion when

234、implementing policies and programming and ensures that each person is accountable for their specific tasks.Such clarity can also help to prevent duplication of efforts and ensure that resources are being efficiently used.For example,the region of East and North Finland piloted a new funding mechanis

235、m to advance its industrial transition aims.The governance structure supporting the piloted policy worked well for all seven regional councils participating in the pilot because each of them agreed early on who would carry out the different tasks involved in the pilot action.In addition,each council

236、 made sure that their staff had the right competencies to carry out assigned tasks,such as proposal evaluations,funding management and meeting co-ordination.Financial and human resources matter when implementing transition initiatives Ensuring that transition initiatives benefit from dedicated finan

237、cial support is critical to their success.For instance,providing policy makers with adequate funding as well as sufficient flexibility to design and amend tailored grants or financial support schemes can help policy makers create a supportive environment in which innovative ideas can be brought to f

238、ruition.Flexibility in the use of financial resources is particularly important for three reasons.First,it can help to support a pipeline of innovative projects that would not have been funded through regular calls.In the case of Wallonia,Belgium,start-ups,SMEs and micro firms indicated that they wo

239、uld not have experimented as extensively as they did without the High Impact Action(HIA)grant they received from the European Commission to support their industrial transition process.Second,flexibility is necessary to enable initiatives to be amended where necessary,thereby ensuring that beneficiar

240、ies receive more targeted support.Third and relatedly,flexibility is necessary in order to ensure that financial support can redirect towards the upscaling of successful initiatives.At the same time,dedicated human resources and local expertise are critical for enabling transition initiatives to gai

241、n traction.In particular,the implementation of such initiatives depends on having at least one dedicated individual with deep knowledge of the targeted industries and the region.It is preferable that this individual be well ensconced in the region,in order to be able to effectively mobilise pre-exis

242、ting local networks when implementing the initiative as well as building new ones.These elements were in place during the Grand Est(France)initiative,which allocated funds for a dedicated agency,along with a project manager,to oversee the development of its Future Activity Zones(Zones dactivits du f

243、utur,ZAFs)and associated assessment tool.The policy action required staff with specialised expertise and knowledge,high levels of professional commitment,willing to take a risk in applying a new idea and also able to engage relevant local actors,bringing them on board with the ZAF concept.It also re

244、quired staff with strong project management skills,given their responsibility for co-ordinating the action and ensuring effective consultations and exchanges with stakeholders.The pilot 25 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 project faced difficulties getting off the ground until a dedic

245、ated project manager arrived,who had the time,personal dedication and responsibility to implement the action.The pivotal role of a dedicated project manager in the success of an initiative was also experienced in Cantabria,Spain.Stakeholder engagement can help to build social capital,which can advan

246、ce industrial transition Social capital can foster good public and corporate governance in regions in industrial transition(McCann,20238).The concept posits that residents use public and private networks and mechanisms to invest in and maintain a local sense of place.For example,the work of local bu

247、siness mentoring organisations can help to improve company practices,providing them with tools that can help them reinvest more effectively in local communities while also helping to improve their profitability.Social capital,however,relies on effective engagement with others be they individuals,fir

248、ms or other organisations that can improve and energise possible collaborative links among the public,private and civil society spheres in a locality,thereby generating a virtuous circle of social capital development(McCann,20238).Effective stakeholder engagement can help to build social capital by

249、generating a strong and shared sense of ownership for community development.This can support more proactive engagement by key stakeholders and also help community initiatives(such as industrial transition initiatives)to gain critical mass.In the Greater Manchester region for example,the Good Employm

250、ent Charters extensive co-design process,with stakeholders from the public,private and third sectors,was a cornerstone of its success in building social capital.Refining charter principles and criteria in close collaboration with business organisations helped to develop a document that fused high em

251、ployment standards and high levels of purpose with realistic and attainable goals for employers.Moreover,the charter implementation units proactive outreach to employers,including organising regular business-to-business mentoring events,helped demonstrate to interested employers that employment stan

252、dards could be successfully improved without bankrupting their organisation.These elements were useful tools that lent legitimacy to the initiative,thereby encouraging more employers to sign up for the charter.As such,they helped create ownership among regional businesses for Greater Manchesters ind

253、ustrial transition goal of improving employment standards.Yet,while governance arrangements such as stakeholder engagement practices can build social capital in a region and provide a strong foundation from which to advance industrial transformation,they must be well-planned and part of a larger pro

254、cess.Being more experimental with these arrangements,applying them to policy design and implementation may also be necessary and featured prominently in many of the regions and countries featured in this report.Industrial transition depends on an effective regional innovation ecosystem Industrial tr

255、ansition and innovation are closely intertwined(Box 2.3).Successful industrial shifts occur when firms and economies respond to new market demands and innovate to create opportunities for workers.They also depend on effective interaction among industry,academia,government and civil society actors(qu

256、adruple helix),which is foundational to any innovation ecosystem.These partnerships facilitate research and development(R&D)initiatives,access to funding and other resources,and a culture of innovation and collaboration that is essential to moving industrial transition forward.26 REGIONS IN INDUSTRI

257、AL TRANSITION 2023 OECD 2023 Box 2.3.Categories of innovation activity Innovation is a cornerstone of industrial transition and regions undergoing industrial shifts will need to underpin these through innovation.However,not all regions have an innovation ecosystem structured to be at the technologic

258、al forefront.A more appropriate approach to regional innovation in these regions is to ensure that the innovation policy advances different types of innovation,including those that depart from current technologies and practices.The primary forms of innovation include:Technological innovation:refers

259、to the development of technologically new or substantially changed goods or services,or the use of a technologically new or substantially changed process.Social innovation:refers to the design and implementation of new solutions that imply conceptual,process,product or organisational change and whic

260、h aim to improve the welfare and well-being of individuals and communities.Business model innovation:refers to change in an organisations value proposition and its underlying operating model,by modifying the rationale of how an organisation creates,delivers and captures value in economic,social,cult

261、ural or other contexts.Policy innovation:refers to a change in the processes,tools and practices used for policy design and implementation with the aim of better solving complex issues.Public sector innovation:refers to the design and implementation by a public sector organisation of new or signific

262、antly improved processes,methods or services from data analytics to prototyping and design thinking aimed at improving its operations or outcomes.Source:Based on OECD(202110),Regional Innovation in Piedmont,Italy:From Innovation Environment to Innovation Ecosystem,https:/doi.org/10.1787/7df50d82-en.

263、Developing an effective innovation ecosystem is important for regions in industrial transition given that they frequently face obstacles in nurturing and diffusing new ideas and technologies.In industrial transition regions,larger firms with established industrial specialisations typically drive inn

264、ovation activities.Yet,the business ecosystem is often composed of many SMEs,family firms and businesses that contract with larger firms.This can limit innovation capacity for several reasons.First,small firms may have low innovation activity due to a reliance on specifications from dominant large f

265、irms that are their clients.Second,SMEs may have difficulties accessing investment capital which they need to undertake innovation-oriented projects.Third,physical,cultural or organisational barriers,such as the geographic isolation of rural businesses,an insular business culture or a traditional bu

266、siness structure can also hinder collaboration-driven innovation(OECD,202110).Finally,the narrow definition of innovation,i.e.focused on R&D and technology,which is often adopted by regions and businesses alike,is also frequently reflected in the types of projects eligible for innovation funding in

267、a region.Often,smaller firms have innovation potential or are innovative without realising it,but either are not eligible for funds or do not consider themselves eligible.Widely communicating and supporting a mix of different types of innovation can strengthen innovation ecosystems and is particular

268、ly important in a region in industrial transition populated by a large number of SMEs and micro enterprises.A robust innovation ecosystem can improve a regions innovation culture,thereby helping companies address industrial transition challenges more effectively.For instance,regional governments sho

269、uld be involved in supporting fora or initiatives through which SMEs,large companies,universities and other innovation stakeholders can engage in collaborative problem solving.In addition,funding schemes and 27 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 investment opportunities need to be devel

270、oped to provide entrepreneurs and start-ups with the necessary funding and other resources to conduct innovation-related initiatives.To strengthen their regional innovation ecosystems,the industrial transition regions in OECD member countries and EU member states involved in this project implemented

271、 various policies and learned valuable lessons along the way.For example,cross-regional collaboration,involvement of regional and local authorities in innovation funding schemes(e.g.in East and North Finland)and societal innovation policy initiatives(e.g.in Cantabria,Spain)have shown positive result

272、s in enhancing innovation potential(OECD,202311;202312).Challenge-oriented(also referred to as“mission-oriented”)approaches to innovation have been successful in promoting collaborative problem solving and innovation at the regional level(e.g.in North Middle Sweden),particularly in environmental sus

273、tainability(OECD,202313).Why help regions in industrial transition succeed Regions in industrial transition are facing increasing economic and social pressures.While the per capita income gap among OECD member countries has declined over the past 20 years,the gap in per capita income between the wea

274、lthiest and poorest regions in an OECD country(TL3 level)has generally widened.As of 2022,70%of the OECD population live in countries that are experiencing increases in regional income inequality(OECD,forthcoming6).These data are instructive,given that regions in industrial transition tend to experi

275、ence low GDP growth and productivity compared to their intra-country regional peers.There are,however,also specific economic factors that are characteristic of regions in industrial transition.Geographically concentrated declines in local industrial activity,especially when not compensated for by ne

276、w job creation in local communities,risk leading to a fall in living standards,economic dislocation,dwindling access to public services and a growing geography of political discontent,borne of feeling that one is living in a region or a community that is undervalued by society(OECD,202314;20197).If

277、left unattended,this geography of discontent risks leading to lower levels of trust in government,social unrest and/or political instability,which makes addressing it an urgent priority for policy makers(OECD,202314;Rodrguez-Pose,201815;Muro,202116).Industrial decline can lead to growing inequalitie

278、s,with high costs Industrial decline can be a catalyst for rising regional inequalities.For example,industrial decline often leads to job losses in the affected region.When industries close or downsize,workers are laid off,resulting in unemployment and reduced income opportunities for the local popu

279、lation.This can create a significant economic disparity between regions with a thriving industrial base and those experiencing a decline.A recent study from Canada examined the impact of manufacturing decline in the country from the early 2000s to the mid-2010s(Morissette,202017).The study found tha

280、t regions with higher exposure to manufacturing job losses experienced persistent declines in employment and wages relative to regions less affected by industrial decline.Additionally,economic dependence on old industries exacerbates regional inequalities.Industries often form the backbone of local

281、economies,contributing to employment,tax revenue and economic growth.When dominant industries decline,the local economy can become overly dependent on shrinking sectors.This can exacerbate regional inequalities,as areas heavily reliant on declining industries face greater economic challenges than re

282、gions with more diversified economies.In fact,regions experiencing industrial decline tended to have lower levels of innovation and higher levels of inequality than regions with a more diverse economic base(Lee and Rodrguez-Pose,201318).28 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Industrial t

283、ransition goes hand in hand with the green and digital transitions Transitions towards a greener economy can affect regions in different ways and the consequences of such transitions on regions in industrial transition are not always net positive.For example,regions in industrial transition tend to

284、have a concentration of employment and economic activity that generates high carbon emissions(OECD,202319).Job losses in these sectors as a result of the green transition can pose risks to the economic prosperity of the regions in which they are located.Such regions often have fewer economic resourc

285、es to absorb shocks and take advantage of economic opportunities.In the European Union for instance,regions that are most vulnerable to climate-related industrial transition tend to lag behind with respect to average GDP per capita and regional wages(OECD,202320).On the positive side of the ledger,i

286、ncreasing the share of green-related jobs2,which carry a 20%average wage premium over non-green-related jobs,can represent an economic opportunity.However,OECD data point to a significant disparity in the employment share of green-related jobs across OECD regions(OECD,202319).Leading regions current

287、ly have green employment shares of around 30%,while in lagging regions,green jobs account for less than 10%of employment(Figure 2.1).These differences partly reflect regional inequalities,as certain regions face other challenges such as a lack of a green skills base,which limits the ability of their

288、 labour force to participate in the green economy(OECD,202319;forthcoming6).Figure 2.1.Regional disparities in green jobs within countries Share of green jobs across and within countries,OECD regions,2021 or last available year Note:Last available year:2019 for the UK;2020 for Iceland;2021 for Austr

289、alia,Canada,EU countries,Norway,New Zealand,Switzerland and the United States.According to the OECD,green-task jobs are defined and analysed at the occupation level based on the greenness of their related task content.Source:OECD(202319),Job Creation and Local Economic Development,https:/doi.org/10.

290、1787/26174979.Central and Western LithuaniaSmland with IslandsNorthern NorwayEspace MittellandSouthlandNorthern IrelandSouthern DenmarkEastern and Northern FinlandNormandyMuraNorthwestNorthern and WesternFlemish RegionAutonomous Region of the AzoresWest AustriaSaxony-AnhaltSouthern Great PlainWest S

291、lovakiaLa RiojaLublin Province Province of Bolzano-BozenTasmaniaWestern GreeceSouth DakotaNewfoundland and LabradorVilnius RegionStockholmOslo and VikenZurichAucklandGreater LondonCopenhagen regionHelsinki-Uusimaale-de-FranceCentral SloveniaPragueEastern and MidlandBrussels Capital RegionNorth(PT)Ea

292、st AustriaHamburgBudapestBratislava RegionMadridWarsawEmilia-RomagnaVictoriaAtticaDistrict of ColumbiaAlberta-10-5055404550LuxembourgLithuaniaEstoniaLatviaSwedenNorwaySwitzerlandNew ZealandUnited KingdomDenmarkFinlandFranceSloveniaIcelandNetherlandsCzech RepublicIrelandBelgiumPortugalAust

293、riaGermanyHungarySlovakiaSpainPolandItalyAustraliaGreeceUnited StatesCanada%LowestNational averageHighest 29 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 In order to ensure that all territories,including regions in industrial transition,can make the most of the opportunities provided by the green

294、 transition,policy makers could build education and training initiatives that will equip workers with the necessary skills for green jobs,for example in the energy efficiency,renewable energy or sustainable constructions sectors.At the same time,it is essential to ensure there are employers who are

295、demanding these new skills.One way to do so is by raising awareness among employers of how employees with these skills can help improve business performance.In both supply and demand side instances,the initiatives can help promote more inclusive growth,while also creating broader support for green p

296、olicies as the benefits of the transition are spread more evenly across the population(OECD,202319).As in the case of the green transition,the economic opportunities emerging from the digital transition are unevenly spread across regions,including within regions in industrial transition,and can vary

297、 according to connectivity and digital skills.Better digital connectivity,for example,allows businesses to adopt advanced technologies and reach a wider market while providing consumers with access to digital services(OECD,202121;World Bank Group,201922).However,sizeable connectivity differences amo

298、ng OECD regions(OECD,forthcoming6)risks leading to significant differences in the ability of people and firms to position themselves for opportunities in the new digital environment.This,in turn,could fuel inter-regional and intra-regional inequalities.In most of the EU regions and countries in indu

299、strial transition featured in this report,internet connectivity levels(measured as household broadband access)hovered at or somewhat below the EUs regional average(92.3%)in 2021(Eurostat,202123).This said,between 2015 and 2021,all of the EU regions and countries in this report saw their growth in di

300、gital connectivity3 exceed the 13.4%regional EU average(except for East and North Finland,which was consistently above the EU average)(Eurostat,202123).The rapid increase in access to broadband Internet can help these regions as they seek to foster innovation,broaden market access and diversify thei

301、r economies.Industrial transition can address regional inequalities,helping build trust in the government In OECD countries,regional inequalities contribute to significant variations in trust in government.The OECD Survey on Drivers of Trust in Public Institutions(also known as the OECD Trust Survey

302、)(OECD,202224),which covers 20 OECD member countries,reveals substantial intra-regional trust variations.These variations range from a less than 10 percentage point difference between the most and least trusting regions in Denmark and Sweden to a more than 30 percentage point difference between the

303、most and least trusting regions in South Korea(Figure 2.2).The data suggest that trust deficits in government have a territorial cleavage in many OECD countries.Long-term industrial decline is one factor that can contribute to regional differences in levels of trust in government.Poor short-term lab

304、our market outcomes and uneven access to quality public services,such as healthcare and education,can also contribute to territorial disparities in trust in government.Unfortunately,regions in industrial transition typically demonstrate some combination of these factors:they are experiencing long-te

305、rm industrial decline,tend to have higher levels of unemployment and poorer outcomes in healthcare and education,which can be linked to service quality and/or service accessibility.Empirical findings from OECD countries indicate that regions characterised by lower levels of trust in government can b

306、e classified into two main groups(Dijkstra,Poelman and Rodrguez-Pose,202025):first,the comparatively wealthy areas that have experienced long-term economic decline;second,the middle-income regions that struggle to sustain economic growth due to a lack of innovation,primarily including rural areas an

307、d small or medium-sized cities.Many regions in industrial transition tend to be characterised by these structural factors.Citizens in each of these regional groups are at risk of succumbing to the geography of discontent(Box 2.4).30 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Figure 2.2.Regional

308、 disparities in national government trust,2021 Share of respondents that trust the national government in OECD regions with highest and lowest level of trust by country,2021 Source:Based on OECD(202224),Building Trust to Reinforce Democracy:Main Findings from the 2021 OECD Survey on Drivers of Trust

309、 in Public Institutions,https:/doi.org/10.1787/b407f99c-en.Box 2.4.Findings from the OECD scoping paper on“Understanding and tackling the territorial drivers of trust in government”The OECD scoping paper“Understanding and tackling the territorial drivers of trust in government”,was completed in 2023

310、,in support of a closed discussion among delegates of the OECD Regional Development Policy Committee(RDPC).It takes stock of the existing literature on territorial disparities in government trust.In particular,it looks at variations in trust levels among OECD countries and territories,the policy lev

311、ers that may help to rebuild trust and areas for future OECD research.The paper finds that trust deficits in government have a territorial cleavage in many OECD countries(see Figure 2.2).In part,these disparities reflect the differing levels of success that national and subnational governments have

312、had in dealing with their citizens challenges and needs.Key factors that contribute to higher and lower levels of government trust in regions include a lack of economic dynamism and opportunities,poor regional labour market outcomes and disparities in access to and quality of local public services.U

313、nless appropriate action is taken by policy makers to address regional disparities,they have the potential to contribute to a growing geography of discontent,which could fuel decreasing trust in national parliaments and increasing votes for anti-system parties.Source:Based on OECD(202314),“Understan

314、ding and tackling the territorial drivers of trust in government”,Unpublished.TasmaniaUpper AustriaWalloniaCanadian PrairiesNorthern JutlandNorth-Eastern EstoniaNorth&EastNorth-EastYorkshire and The HumberNorth&WestNorthTohoku regionGyeongsang ProvinceWest Latvia(Kurzeme)NorthTrondelag&NorthManawatu

315、-WhanganuiMadeiraSouth Sweden(Skane,Halland&Blekinge)Western AustraliaSalzburgBrusselsQuebecSouthern DenmarkWestern EstoniaHelsinki-UusimaaGreater ParisEast MidlandsEast&MidlandSouthKansai regionChungcheong ProvinceSouth Latvia(Zemgale)EastOslo&Oslo regionWaikatoAlentejoMiddle South SwedenAUSAUTBELC

316、ANDNKESTFINFRAGBRIRLISLJPNKORLVANLDNORNZLPRTSWE00708090100Trust in government(%)Region with lowest level of trust in government in countryRegion with highest level of trust in government in country 31 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 Advancing industrial transformation thro

317、ugh experimental governance and policy making Experimental governance involves a process of trial and error with new tools,methods and approaches when designing and implementing policy to improve development outcomes.With respect to regional development,it can be applied towards fostering innovation

318、 and economic growth in the public and private sectors,which in turn supports industrial transition(Wolfe,201826).Through experimental governance,regions in industrial transition can explore innovative approaches to address challenges that are specific to their context.This may involve piloting new

319、policies,programmes or projects that encourage economic diversification,foster sustainable practices,promote entrepreneurship and innovation or support the reskilling and upskilling of the workforce.Experimental governance offers policy makers a number of potential benefits,including the following(O

320、ECD,202227):Evidence bases:Evidence is gathered ex ante,in process and ex post,which can help policy makers better understand the problem at hand,design a more targeted intervention and understand what works and does not,in order to make better-informed decisions over time.Innovation:Space is create

321、d to explore innovative ideas in policy or project design and implementation.Adaptability:Initiatives are designed in an environment where adaptation or adjustment of the initial idea due to unforeseen circumstances or early signs of difficulty is possible and encouraged in order to maximise the pot

322、ential for success.Risk management:Small-scale testing of policies or initiatives allows policy makers to better identify and mitigate potential risks and unintended consequences,increasing the possibility of upscaling.Cost-effectiveness:Introducing a new concept at a smaller scale in order to bette

323、r determine immediate and longer-term costs of policy options,in terms of capital(investment cost)as well as costs/benefits for firms and communities.Learning and improvement:Policy makers are given an opportunity to learn or reinforce their skills,and learn from successes and failures,promoting con

324、tinuous professional development and improvement in policy design and implementation.Experimental governance can be thought of in three related dimensions(Figure 2.3).First,experimental governance itself is a policy approach that emphasises novelty and ambition,for example by focusing on resolving l

325、arge-scale societal challenges.Inherent to this dimension is an acceptance of risk by policy makers.Because experimental approaches involve testing new ideas and policies in real-world settings,there will always be some level of uncertainty and risk involved.Second,the concept of collaboration in ex

326、perimental governance involves engaging a broad range of stakeholders,including citizens,businesses and government officials,in designing and implementing policies that are more responsive to local needs and conditions.Third,learning from experimental governance emphasises a continuous process of mo

327、nitoring and evaluation,whereby policy makers continually evaluate the effectiveness of their policies and make adjustments based on data analysis and feedback from stakeholders.This approach can help to build trust and support among stakeholders and increase the likelihood of successful policy outc

328、omes(Marques,n.d.28).Adopting an experimental governance approach is not without its challenges,however.Experimentation involves risk-taking and can lead to failure,both of which are unsettling concepts in a policy environment,although inherent in an entrepreneurial one(Huggins,Morgan and Williams,2

329、01429).It also requires sufficient institutional capacity among subnational public bodies to partner with non-governmental actors(e.g.the private sector,academia,civil society and citizens)and to communicate effectively with them 32 REGIONS IN INDUSTRIAL TRANSITION 2023 OECD 2023 regarding the ratio

330、nale,risks,costs and benefits of an experimental initiative(OECD,202030).Furthermore,it depends significantly on the political will and support given to national and subnational policy makers and civil servants to be creative and assist in scaling up their experiment if it is successful.Ultimately,e

331、xperimental governance requires a shift in the public sector mindset and culture towards embracing uncertainties(Wolfe,201826).Figure 2.3.Three dimensions of experimental governance for regional innovation policy making Source:Marques,P.(n.d.28),“The role of experimental governance in regional innov

332、ation policymaking”,Unpublished.How does experimental governance benefit regions in industrial transition?When properly designed and executed,an experimental approach can enable public,private and third-sector stakeholders to work together and find joint solutions to common problems through trial an

333、d error.Notably,it can be a useful instrument for testing a new public policy,policy tool or delivery model before rolling it out more widely.Experimentation may also help test an initiative in one sector or industry before transferring it to another.Effective scaling of policy experiments can expand their reach and impact while allowing them to address industrial transition challenges on a broade