Innovation, Industrialisation and International competitiveness

School of Management Coursework Submission Sheet

Student name(s) % %

For group work – individual % contributions need to be stated only where they are not equal.

Department (e.g. Management): Management

Programme and Year of Study:

Name of lecturer: Dr Felicia Fai

Unit title and code (eg MN20010): MN30222_

Number of pages in assignment: 13 Word count: 3,647

Declaration

I/we certify that I/we have read and understood the entry in the relevant Student Handbook for

the School of Management on Cheating and Plagiarism and that all material in this assignment is

my/our own work, except where I/we have indicated with appropriate references. I/we agree that,

in line with Regulation 15.3(e), if requested I/we will submit an electronic copy of this work for

submission to a Plagiarism Detection Service for quality assurance purposes. I/we also confirm

that the percentage allocation of work is as shown above.

Upload your coursework via the Unit’s Moodle Page by the specified submission date and time.

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can be pasted into the front page of your assignment if requested by your tutor. Copies are also

available from Management Reception.

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40%. Any assessment submitted more than 5 working days without an agreed extension will

receive a mark of zero

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the end of each Semester.

ASSESSMENT RUBRIC 1 2 3 4 5 6

0-39% 40-

49%

50-

59%

60-

69%

70-

79%

80-

100%

Criterion 1

Addresses the question

The relevance of content in addressing the

question

X

Criterion 2

Use of research and examples

Use of material appropriate for the assignment,

including assigned and wider readings.

X

Criterion 3

Analysis and development of argument

The construction of a coherent and convincing

argument/ for holding a particular view.

X

Criterion 4

Depth of knowledge and critical

understanding

Depth of knowledge of relevant literature.

Including, where appropriate, attention to both

strengths and limitations of the research findings,

theories and methods discussed; to their

applicability (or otherwise) in particular situations;

and to the points of view (interests, biases, norms)

that may be reflected in them.

X

Criterion 5

Originality

Provision of new insights or original ideas based on

independent thought or creative thinking.

X

Criterion 6

Structure

A logical arrangement of the work into sections

(introduction, main points, conclusion) with

appropriate paragraphs, linking and signposting.

X

Criterion 7

Presentation

Putting across ideas clearly, succinctly and

without grammatical and spelling errors.

X

Criterion 8

Referencing and bibliography

Acknowledgement of sources using appropriate

citation conventions e.g. Harvard standards.

X

Comments/Improvement Suggestions

This is very well composed and written. Lapland was an interesting choice, informative. I enjoyed your section on

SS as a concept and policy. I appreciate the attempt to be critical, although I think there is a flaw (see in text

comments). You have brought together material from several sources to construct your case study and arguments

well. I know you provide detail on SS activities and thematic priorities, but in terms of examples, it would have been

nice if occasionally, you could have gone down a level to describe the details of a particular activity and how a

specific firm, university etc came together to deliver on it. I liked the regional, national and international device for

the discussion of inter-regional partnerships/linkages.; neatly organised. Very minor issues in your technical

academic writing skills (page numbers, consistent use of fonts in formatting the references). 73%

School of Management Generic Marking Scheme for Undergraduate Assessments

Level 2/3 (units starting with MN2 or MN3)

Convenors should provide students with a copy of the relevant School of Management Generic Marking Scheme at

the time that assessment is set.

80-100 First class performance plus. Outstanding performance that fulfils and exceeds designated learning

outcomes

The level of reasoning and research or critical approach to research is highly professional and potentially

publishable. Demonstrates a high degree of originality in the argument and execution. Strong ev idence of

understanding and critique of complex ideas from reading published research in the field. Excellent, highly

readable expression.

70-79 First class performance. Excellent performance relative to designated learning outcomes

Excellent understanding of the theories presented on the unit and critical approach to research findings in the

subject area. Examples are drawn from the student’s own investigation or conception and are intelligently

used. Demonstrates a good understanding of central ideas in the discipline from wide reading of published

research in the field. Shows the capacity to sustain a sound argument through to conclusions clearly informed

by research in the subject area or discipline. Very good expression.

60-69 Good Pass. Very good performance relative to designated learning outcomes

Shows good understanding of the theoretical content and of its application. Where examples are used, these

are derived from the student’s own investigation rather than simply being transferred from class material. The

argument and/or presentation of different points of view are clear and well constructed in relation to the

question set. Shows a broad awareness of emerging ideas from recent research in the subject area drawn from

reading outside lectures. Only minor flaws in expression.

50-59 Pass. Good performance relative to designated learning outcomes

Demonstrates an understanding of the content of the unit, but may lack some understanding of the more

sophisticated theory. Arguments or points of view are presented but understanding of their background or

principles may be more limited than for marks in the higher categories. Limited engagement with emerging

ideas in the subject area or discipline and limited evidence of reading outside lectures. Some use examples

drawn from the student’s own reading. Expression needs attention.

40-49 Low Pass. Satisfactory performance in designed learning outcomes

Demonstrates an understanding of the content of the unit, but does not extend investigation or analysis beyond

material presented in lectures. Expression needs serious attention.

35-39 Borderline Fail.

The student has not yet shown an adequate grasp of the subject, possibly with some serious misconceptions in

the theory or failure to apply it in an appropriate way. (marks in this range are potentially condonable – i.e.,

depending on the student’s overall profile of marks, it is possible for credit to be awarded without the need for

a successful retrieval to be undertaken)

20-34 Fail.

A failure to meet the assessment criteria for the piece of work, either through consistently poor execution,

comprehensive misunderstanding of the unit’s content or a failure to address the question set. (marks in this

range are potentially condonable – i.e., depending on the student’s overall profile of marks, it is possible for

credit to be awarded without the need for a successful retrieval to be undertaken)

0-19 Fail. A failure even to approach the learning outcomes for the unit or the set assessment criteria.

Significant portions of the assessment either not present or not comprehensible as an answer to the question

set. (marks in this range are potentially condonable – i.e., depending on the student’s overall profile of marks,

it is possible for credit to be awarded without the need for a successful retrieval to be undertaken)

Outline the concept of ‘Smart Specialisation’. For a region of your choice describe the activities and

initiatives are being undertaken that would indicate the region is attempting to/could adopt smart

specialisation policies. Identify which avenue(s) hold the greatest potential for the region’s growth in

the future. To what extent does this rely on regional level connections and activity versus

interregional/international connections and activity?

Word Count: 3,647

MN30222: Innovation, Industrialisation & International

Competitiveness

Smart Specialisation

Abstract

Smart Specialisation (SS) is an increasingly adopted policy within the EU and aims to promote economic

growth through the specialisation and diversification of key value-adding activities. For the purpose of

this investigation, Lapland’s current SS strategy will be explored. Lapland provides an interesting research

base due to its unique regional characteristics. This report will first analyse the concept of SS in a general

setting, and then outline SS at a national level within Finland to provide context for the following regional

level analysis. The paper identifies three key activities Lapland is pursuing in its SS strategy: refining

natural resources, utilising current natural conditions and cross-cutting development enabling growth,

leading to the identification of the avenue holding the greatest potential for regional growth. The paper

concludes by recognising Lapland’s reliance on a combination of regional, national and international

connections and activity for its SS policy.

Smart Specialisation (SS) is an innovative concept adopted by the European Union (EU) aimed at

promoting economic growth across the EU by recognising the existing strengths of individual regions and

developing them to bolster value-creating activities (Foray, 2014). Established in 2011, the Smart

Specialisation Strategy is a current EU policy which contributes to the European Commission’s 2020

objective of “smart, sustainable and inclusive growth” (Europa.eu, 2018). The policy was introduced as a

means to offset the significant Research and Development (R&D) deficit within Europe, as Smart

Specialisation is a much needed tool to increase innovation and diversity, subsequently boosting overall

economic growth (O’Sullivan, 2009). The Smart Specialisation platform connects approximately 170 EU

regions, and in doing so enables the sharing of knowledge and data, whilst opening networking

possibilities (Europa.eu, 2018). Smart Specialisation is an ongoing, dynamic process with no official

endpoint, as its aim is to implement an underlying structural change in the way regions operate and interact

with one another (Barzotto et al., 2018). It is a plant-based and bottom-up approach, and recognises the

strengths and weaknesses of individual regions and encourages them to follow and pursue their promising,

successful activities. Funding for Smart Specialisation projects is available through both regional and

national forms, as well as the European Structural and Investment Funds, which was set up by the EU and

has over 67 billion euros available (Europa.eu, 2018). Smart Specialisation creates an efficient avenue for

EU funding as it generates inclusive European value (NSPA, 2017). By 2020, Smart Specialisation is

expected to bring 15,000 new products to market, create 140,000 new start-ups and produce 350,000 new

jobs (Europa.eu, 2018), thus evidencing the large impact of the policy.

Smart Specialisation acknowledges the benefits of specialisation and is designed to assist regions when

choosing which activities to prioritise. That said, it does not solely consist of identifying strengths, it also

encourages regions to explore new markets and technologies. It looks further into how a region can benefit

from investing and focusing on R&D in a particular activity (Foray & Goenaga, 2013). Smart

Specialisation requires regions to look inward to assess their local productive capabilities in order to meet

their potential and develop their own competitive advantages. By combining innovation, education and

industrial policies, Smart Specialisation encourages regions to focus and direct their investment towards

a limited number of priority industries (OECD, 2013). By coordinating the appropriate policies,

investment and allocation of resources, the overall aim is to boost economic growth by enhancing a

region’s comparative advantages (NSPA, 2017). Further, Smart Specialisation refers to the prioritisation

of key ‘activities’ rather than ‘sectors’ or ‘industries’, as it recognises that there can be overlaps between

technologies across industries. Therefore, focusing on improving activities helps multiple sectors. Smart

Specialisation suggests that each region should aim for their chosen priority activities to be as unique as

possible; this ensures there is a more diverse pool of resources being utilised and thus a larger impact on

the region (Foray & Goenaga, 2013).

There are two key underlying themes when examining the policy of Smart Specialisation. The first of

which is the spillover effects the success of a particular activity has on society: it creates social value

through job creation, increased skills and investment, as well as encouraging new agents to enter the

market (Foray & Goenaga, 2013). Moreover, the acquisition of knowledge from increased R&D activities

can also spillover to other industries, thus enhancing the scope for economic growth. Secondly, Smart

Specialisation initiates an overall, deep-rooted underlying change within a region. It creates a “structural

evolution”, as synergies between old and new processes combine to create a new, diverse regional

economy (Foray & Goenaga, 2013). This is facilitated by constant R&D and diversification of activities,

which allows future activities to evolve from existing resources. That said, Smart Specialisation also

carries with it a high level of risk and is subject to criticism. Smart Specialisation requires a region to

Commented [FF1]: Place-based!

Commented [FF2]: Not yet – those figures are ambitions, not achievements

Commented [FF3]: Good.

Commented [FF4]: Yes, good

Commented [FF5]: Yes.

Commented [FF6]: New paragraph?

dedicate its time, resources and investment into a few unique activities, and in doing so, is essentially

“putting all their eggs in one basket”. Changing markets, evolving technology, political instability and

shifting trends all have the potential to disrupt a specific activity, and consequently negatively harm a

region devoted to it. Typically, policymakers aim to diversify their investment and resources into several

activities to mitigate risk; however, such an approach opposes the fundamental concept of Smart

Specialisation. Therefore, there is a certain degree of subjectivity, as Smart Specialisation depends on the

approach of the policymaker, not just the resources available to the region. Furthermore, there is a risk

that the “disease of the routinisation”, causes a region to lack the appropriate creativity, innovation and

vision to pursue Smart Specialisation (Foray & Goenaga, 2013). Thus, regions need to ensure the Smart

Specialisation policy they adopt is a constant, dynamic process.

A major flaw identified with Smart Specialisation is the direct negative impact on entrepreneurs. Instead

of the rewards of successful entrepreneurism going straight back to the entrepreneur, they are more evenly

distributed throughout society (Hausmann and Rodrik, 2003). Thus, although there is an overall welfare

gain for society, the individual loses on their investment as the knowledge and skills created by their

venture indirectly goes not only to society but also their competitors. Smart Specialisation recognises that

entrepreneurs are in the strongest position to engage in R&D. The element of “entrepreneurial discovery”

(Foray & Goenaga, 2013) is central to Smart Specialisation as its bottom-up approach promotes innovation

from the individual, rather than the government (OECD, 2013). The term ‘discovery’ refers to the need

for exploring, learning and trial and error in order to expand and open new domains (Foray & Goenaga,

2013). Therefore, this report acknowledges that a certain paradox arises, as although entrepreneurism is

central to Smart Specialisation, it is not particularly attractive to entrepreneurs themselves due to the

reduced rewards.

At a national level, Finland is a key advocate for national innovation systems and a supporter of Smart

Specialisation. As a member of the EU, Finland is required to engage in Smart Specialisation in order to

receive any EU funding for it. Finland has managed its education, technology and innovation policies in

order to establish an extremely centralised innovation system (Teräs & Maenpää, 2016). Through the

Finnish Regional Strategy 2020, Finland aims to improve its economy by profiting from its regional

abilities and establishing itself as a specialised function within the wider global economy (Teräs &

Maenpää, 2016). The Finnish Ministry of Economic Affairs and Employment, along with multiple

regional councils, are major actors in Finland’s Smart Specialisation Strategy. Finland’s 2020 Strategy

views regional Smart Specialisation as a crucial policy which acts as an essential driver of economic

growth and development. Finland emulates a national innovation system due its high regard for

innovation, which is supported by Finnish policymakers’ support and appreciation of R&D, specialisation

and diversification. Indeed, between 2016-2018, Finland dedicated 30 million euros in funding to Smart

Specialisation in order to encourage regional development (Europa.eu, 2018). Policymakers have also

made economic agreements between seven major regions to improve communication and networking in

a bid to increase overall regional competitiveness (Europa.eu, 2018). The Finnish government aims to

facilitate a structural change towards a more regional, specialised state, which is not only successful within

Finland, but recognised worldwide (Kristensen et al., 2018). Therefore, before this report analyses

Lapland at a regional level, it is evident that Lapland is situated in a supportive, innovation-centred

country; a nation that is indeed actively adopting smart specialisation policies.

At a regional level, Lapland has demonstrated its ability to engage in a strategy of Smart Specialisation.

Lapland is Finland’s most Arctic region, consisting of 98,982 km2 with a population of 183,330

Commented [FF7]: good

Commented [FF8]: I appreciate that you have tried to be critical and have used and academic reference as the basis for

your critique, but you need to go back and read Hausmann

and Rodrik more carefully. They are dealing with developing

countries where conditions are different to advanced

countries. The EU deals with advanced countries (even if

some regions may be under-developed, they will be subject to

national level institutions which are designed for the more

advanced status of the nation as a whole). See their paper,

page 5, final paragraph. As a result I do not think your

criticism appropriate here.

Otherwise your discussion of SS is very good.

(Kristensen et al., 2018). Despite its high latitude, Lapland is considered Finland’s most international

region due to its close proximity to Sweden, Norway and Russia (Lappi.fi, 2018) and is also seen as the

EU’s gateway to the Arctic. In terms of research institutes, Lapland hosts the University of Lapland, the

Arctic Centre of the University of Lapland, the Sami Education Institute and the Lapland University of

Applied Sciences. The concept of Smart Specialisation is particularly fascinating in relation to Lapland

due to the region’s unique environment, which adds a new dimension when considering Smart

Specialisation. Indeed, as Lapland is sparsely populated and has a significant abundance of wildlife, it is

essential to ensure there is a balance between new development and the protection of traditional Arctic

nature. Thus, when analysing Lapland’s Smart Specialisation activities, it is essential to also consider the

impact on the region’s vulnerable natural conditions, including its “Arctic pride”, which is central to

Lapland’s culture (Lappi.fi, 2018). The EU identified expertise in transport, tourism and nature, as well

as ideal living conditions and strong research institutions, as Lapland’s competitive advantages (Heikka

et al., 2013). Lapland faces a number of key challenges: long distances, the difficult Arctic weather

conditions, a reducing population, loss of animal migration and a small number of foreign companies.

Lapland uses its Arctic expertise throughout all areas of business; however, their most notable areas

involve natural resources, such as sustainable mining, forestry and agro-food, and natural conditions,

particularly tourism. Additionally, the steel industry and business arising from climate change are also

key emerging sectors (Lappi.fi, 2018). Lapland’s existing strengths in these industries lay the foundations

for an effective Smart Specialisation policy. The graph below illustrates Lapland’s key spearhead

industries in relation to the region’s current infrastructure and business capabilities, therefore highlighting

mining, the bio-economy and tourism as the region’s three largest priorities.

Commented [FF9]: Source?

Lapland’s move towards adopting a Smart Specialisation policy was formed between 2012-2013 and was

implemented in 2015 (Kristensen et al., 2018). Lapland’s Arctic Specialisation policy recognises the

potential of the region’s natural resources and aimed to utilise these existing assets to give Lapland a

“leading position globally in smart and sustainable exploitation and commercialisation of the Arctic

natural resources and conditions” whilst keeping a strong focus on sustainability (Heikka et al., 2013).

Indeed, Lapland is so committed to its Smart Specialisation policy, it aims to become the most innovated

sparsely populated region in the EU by 2022 (Luotsi.lappi.fi, 2017). The policy aims to give both regional

and international advantages, firstly by improving the region’s internal economic growth and secondly,

by establishing Lapland as an attractive EU partner, thus providing international opportunities. The

programme’s vision is to not only provide Lapland with more skills, resources and funding, but also more

regional control as to how they run their operations. As Lapland is seen as the EU’s gateway to the Arctic,

the EU has a vested interest to help Lapland’s regional activities; this is evidenced by their funding and

support of the programme (Northsweden.eu, 2018).

Monitoring and evaluation are key principles of Smart Specialisation, so it is essential there are sufficient

benchmarks, criteria and indicators in place (Foray & Goenaga, 2013). Lapland’s Arctic Specialisation

programme, in line with EU regulation, requires reporting of the status and results of all activities in order

to identify mistakes and ease decision-making when choosing which future projects and activities to

promote (Lappi.fi, 2018). Lapland’s Smart Specialisation programme is overseen by a regional council,

which has distinguished five key Arctic ‘truffles’, regional clusters and ecosystems to support the policy’s

emerging activities. The five clusters are the Arctic Development Environments cluster, the Arctic Design

cluster, the Arctic Industry and Circular Economy cluster, the Arctic Smart Rural Community cluster and

the Arctic Safety cluster (Lappi.fi, 2018). These aim to act as a high-level, overarching support system to

provide the appropriate skills, assets, networking and regional expertise to assist and complement the

region’s specific value-creating activities.

Lapland’s Arctic Specialisation Strategy identifies three main activities to promote between 2014-2020:

refining natural resources, utilising current natural conditions, and cross-cutting development enabling

growth (Heikka et al., 2013). The focus and prioritisation of these three activities aim to generate broad,

far-reaching and positive implications for the region’s main industries. These activities specifically target

Lapland’s previously identified thematic priorities: mining, bio-economy and tourism. That said, in line

with the fundamental concept of Smart Specialisation, it is expected the expertise and capability gathered

will be employed across multiple sectors and will have positive trickle-down effects throughout the whole

region (Heikka et al., 2013).

Refining natural resources aims to generate maximum value and contribution to growth by promoting

Arctic industry and the bio-economy, whilst considering social and ecological responsibilities. The

specific actions for this activity can be seen in Appendix 1. These actions demonstrate how Lapland’s

existing natural resources can be commercialised to create more jobs, increase business and further the

region’s expertise; in doing so, stimulating the economy. Secondly, Lapland can use its natural conditions

to remain an internationally-recognised tourist hotspot, as well as increase its Arctic expertise in areas

such as construction and automotive testing. Actions for this particular route are shown in Appendix 2.

Activities focused on creating material benefits from Lapland’s natural conditions generate value by

creating further business opportunities. Finally, cross-cutting development intends to combine Lapland’s

strengths to improve the region’s accessibility, in a geographic, digital and educational form. Appendix 3

outlines the precise actions for this targeted activity. By cross-cutting Lapland’s development, there are

Commented [FF10]: Page numbers of direct quote?

wider impacts on society as sectors ranging from digital to logistics can be improved, thus creating

stronger economic growth. The actions presented in the appendices explicitly demonstrate the extent to

which Lapland is embracing its Smart Specialisation Strategy, as the actions employed cover an extremely

wide range of activities, thus effect multiple industries and make a large contribution to the region’s

overall economic growth.

Further to this, there are several other initiatives that have been undertaken by Lapland in order to promote

the regional economy. Firstly, as previously mentioned, five new regional clusters have been established

in order to enhance communication and cooperation between significant actors within the region. The

clusters cover a wide range of areas and are primarily aimed at facilitating R&D. Lapland was named a

model region in cluster development by the EU; a testament to the success of Lapland’s efforts

(InterRegEurope, 2018). Further to this, Lapland launched Arctic Smartness Excellence (ASE), a regional

project aimed at cultivating and further improving its clusters. Funded by the European Regional

Development Fund, the project is another attempt to increase collaboration between clusters and is

evidence of the EU’s support. These initiatives, combined with Lapland’s proactive Arctic Specialisation

policy, prove Lapland’s commitment to regional Smart Specialisation. Lapland is fully complying with

the framework of Smart Specialisation, by identifying and prioritising activities which will create the most

value across the region as a whole. Therefore, Lapland’s clearly defined policy and initiatives advocate

that Lapland is indeed in the process of successfully adopting Smart Specialisation.

Of the three main avenues identified as part of Lapland’s Smart Specialisation strategy, the route which

offers the most future growth is the commercialisation of Lapland’s natural resources. Lapland has the

ability to lead and maintain its position at the forefront of Arctic industry activities by ensuring as much

value as possible is created from refining the region’s resources, while still remaining socially and

environmentally friendly. This avenue attempts to internationalise Lapland’s Arctic resources in all

elements of business, from large-scale suppliers to smaller-scale businesses (Heikka et al., 2013). Under

the umbrella of natural resource refining, the route involves four key project areas: new sustainable Arctic

industry and mining, Arctic bio-economy, a large-scale Arctic project programme and an Arctic natural

resource refining programme for SMEs (Heikka et al., 2013). These four diverse areas show how far-

reaching the development of this activity can ultimately be. This avenue holds the greatest potential for

the region’s future growth because it directly impacts and benefits the two largest thematic priorities

previously identified: mining and bio-economy. Specifically to the mining sector, this approach focuses

on eco-efficient, low-carbon mining, reforming industrial and mining service companies, developing

future mining research programmes and promoting a natural resources knowledge and innovation

community (Heikka et al, 2013). This aims to create growth by implementing activities to improve the

efficiency and sustainability of Lapland’s mining sector, whilst still acknowledging and respecting

Lapland’s valuable environment. Mining is central to Lapland’s economic growth; the region has the

largest gold mine and only chrome mine in the EU, as well as the EU’s largest refining industrial

concentration (Eastnorth.fi, 2018). Given this avenue creates activities which directly impact and help the

region’s mining industry, it further justifies the strength of the approach of natural resource refining.

Moreover, in terms of Lapland’s bio-economy, this strategy aims to create business possibilities by using

collaborations, bio terminals and utilisation of ash. A bio-economy includes all sectors and involves using

and recycling natural resources economically. It is an efficient, sustainable business solution to rising

environmental concerns (Lapland.fi, 2018). By utilising the abundance of natural resources Lapland

already has, the region is able to stimulate economic growth further by creating more business

development opportunities. The commercialisation of Lapland’s natural resources offers more potential

growth than the other two routes of natural conditions and cross-cutting development, as there is much

more scope to create more value-adding activities. Despite the current individual success of the other two

approaches, relying solely on improving tourism or pushing Arctic research provides only a limited

amount of growth to the region. The strategy of refining natural resources aims to present Lapland as

much more than a tourist destination, as it exhibits Lapland as a thriving location, both for residing and

business. This is particularly crucial given Lapland’s declining population (Lappi.fi, 2018). Therefore, the

avenue of refining natural resources has the highest potential for growth due to the large expected effects

on the regional economy.

Lapland’s Arctic Specialisation policy relies on a combination of regional, national and international

connections and activity. At a regional level, Lapland has several bodies which contribute to its Smart

Specialisation policy, including the Centre for Economic Development, Transport and the Environment,

the Regional State Administrative Agency and the Regional Council of Lapland. Policy aims are also

facilitated and helped by the multiple research institutes within Lapland, such as the several

aforementioned universities. In addition, there are also Lappi agreements and support from the Sámi

Parliament (Lappi.fi, 2018). Within the region, there is collaboration towards strategic activities, as well

as several regional strategies in place to promote economic growth (Heikka et al., 2013). There is funding

available through regional development resources, revenues from local business and also from regional

ministries.

On a national level, Lapland benefits from Finland’s proactive policy towards Smart Specialisation.

Finland is an extremely advanced country in terms of its Smart Specialisation outlook, and it continually

promotes cooperation amongst all regions within the country. In 2013, Finland introduced its Strategy for

the Arctic policy, which promotes Arctic support, research and business, whilst highlighting the

significance of the Arctic region to Finland as a country. Finland’s national Arctic strategy heavily

supports Lapland and recognises the region as an essential part of Finnish culture (Heikka et al., 2013).

Moreover, Finland has implemented several initiatives such as its own specialisation strategy, as well as

national partnership agreements and national competitiveness programmes in order to help regional

specialisation (Heikka et al, 2013). A study by Barzotto et al. (2018) found that high-performing regions

prefer to work with similar regions; in a partnership there is no incentive to share skills and resources with

low-performing regions. That said, given the policies put in place by Finland at a national level to

encourage regional interaction, Lapland still benefits from larger regions within Finland, such as Helsinki-

Uusimaa. Lapland also receives national funding, via investment funds, European Structural and

Investment (ESI) funds and TEKES, the Finnish funding agency for technology and innovation.

At an international level, specifically the EU, Lapland benefits from the Arctic Stakeholder Forum (ASF),

which streamlines EU funding programmes to provide funding to Arctic regions, with the goal of

improving communication and networking. The ASF places particular attention on Lapland due to the

region’s heavy tourism and low population density (Europa.eu, 2018). The ASF is evidence of the EU’s

increasing focus on regional Smart Specialisation (NSPA, 2017). The EU also has more general policies

to promote Smart Specialisation activities, such as the Innovation Union, the EU Strategy for the Baltic

Sea Region and EU Digital Strategy. EU funding instruments include Interreg, a policy aimed at helping

regional governments stimulate innovate. Additionally, the EU’s Horizon 2020 programme provides

investment to encourage research and innovation (Heikka et al., 2013). Therefore, it is clear Lapland

Commented [FF11]: Nice counter example to your broader point

benefits from a combination of regional, national and international connections when engaging in

activities as part of its Smart Specialisation policy.

This report has investigated the benefits of Smart Specialisation to a regional economy. The focus on

Lapland has shown that despite a low population and unique environment, Smart Specialisation can still

be an effective policy. Although Smart Specialisation is typically explored with regard to technology-

centred activities, this report highlights the extent to which the policy can be applied, covering other areas

such as mining. This assignment reveals that Lapland is indeed making positive traction towards Smart

Specialisation. By identifying and prioritising the three key activities of refining natural resources,

utilising current natural conditions and cross-cutting development, Lapland is actively pursuing a Smart

Specialisation policy. This report identifies the activity of refining natural resources to have the most scope

for growth in the future, due to the wide-ranging effects on Lapland’s regional economy, as it is promoting

economic growth whilst considering Lapland’s natural environment. Lapland’s effective Smart

Specialisation policy is recognised both nationally and internationally, and thus receives support and

funding through regional, national and international channels. Although the effectiveness of Smart

Specialisation ultimately depends on the motivations of Lapland’s regional council, it is evident through

their actions and policymaking that, as a region, Lapland is proactively following the policy. Smart

Specialisation is an effective policy tool, which, combined with Lapland’s abundance of natural resources

and Arctic expertise, paves the way for a long-lasting and successful regional economy.

Commented [FF12]: Very good, this multi-layer discussion.

References

Barzotto, M., Corradini, C., Fai, F., Labory, S. and Tomlinson, P. (2018). Enhancing Innovative

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Commented [FF13]: Why capitals

Appendices

Appendix 1: Refining Natural Resources- Proposals for Action

Appendix 2: Utilising Natural Conditions- Proposals for Action

Appendix 3: Cross-Cutting Development- Proposals for Action

Appendix 1: Refining Natural Resources- Proposals for Action

Source: Heikka, K., Jokelainen, K. and Teräs, J. (2013). Lapland’s Arctic Specialisation Programme.

[online] onlines3.eu. Available at: http://www.onlines3.eu/wp-

content/uploads/RIS3_strategy_repository/FI_Lapland_Arctic_specialisation_programme_web.pdf

[Accessed 29 Nov. 2018].

Appendix 2: Utilising Natural Conditions- Proposals for Action

Source: Heikka, K., Jokelainen, K. and Teräs, J. (2013). Lapland’s Arctic Specialisation Programme.

[online] onlines3.eu. Available at: http://www.onlines3.eu/wp-

content/uploads/RIS3_strategy_repository/FI_Lapland_Arctic_specialisation_programme_web.pdf

[Accessed 29 Nov. 2018].

Appendix 3: Cross-Cutting Development- Proposals for Action

Source: Heikka, K., Jokelainen, K. and Teräs, J. (2013). Lapland’s Arctic Specialisation Programme.

[online] onlines3.eu. Available at: http://www.onlines3.eu/wp-

content/uploads/RIS3_strategy_repository/FI_Lapland_Arctic_specialisation_programme_web.pdf

[Accessed 29 Nov. 2018].