Southern Germany’s innovation clusters: regional growth coalitions in the knowledge economy

Mitsch, Frieder ORCID: 0000-0002-2511-2979, Hassel, Anke and Soskice, David (2024) Southern Germany’s innovation clusters: regional growth coalitions in the knowledge economy. III Working Paper (148). International Inequalities Institute, London School of Economics and Political Science, London, UK.

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Abstract

This paper examines Germany’s distinctive path toward the knowledge economy, emphasizing the role of regional innovation dynamics and governance, with a focus on Southern Germany’s high-innovation clusters. Unlike other advanced economies that pivoted toward high-tech services, Germany has prioritized digital advancements within its manufacturing base, creating a model driven by smart manufacturing and Industry 4.0. We argue that regional growth coalitions, formed by firms, social partners, and local governments, foster institutional configurations supporting knowledge-based and innovation-focused competition. This regionalized governance has enabled Southern Germany to capitalize on Germany’s innovation agenda, a success that other regions have struggled to replicate. By analysing multi-scalar dynamics—interactions across regional, national, and EU levels—our study expands evolutionary economic geography (EEG) and political economy literature, challenging traditional, nation-centric frameworks. Our findings highlight that cohesive regional governance can enhance national and supranational innovation strategies, underscoring the importance of regional institutions in advancing and sustaining knowledge economy innovation.

Item Type:	Monograph (Working Paper)
Additional Information:	© 2024 The Authors
Divisions:	International Inequalities Institute
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HD Industries. Land use. Labor
JEL classification:	O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O33 - Technological Change: Choices and Consequences; Diffusion Processes R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, and Changes L - Industrial Organization > L5 - Regulation and Industrial Policy > L52 - Industrial Policy; Sectoral Planning Methods O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O18 - Regional, Urban, and Rural Analyses
Date Deposited:	05 Dec 2024 14:12
Last Modified:	11 Sep 2025 05:19
URI:	http://eprints.lse.ac.uk/id/eprint/126264

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