Competitiveness, Productivity and Economic Growth across the European Regions

Recent years have seen a surge of academic and policy attention devoted to thenotion of ‘competitiveness’: nations, regions and cities, we are told, have no option but tostrive to be competitive in order to survive in the new global marketplace and the ‘newcompetition’ (BEST, 1990, 1998) being forged by the new information or knowledge-driven economy. Policy-makers at all levels have been swept up in this competitivenessfever. Thus the importance of competitiveness has been a recurring theme in OECDassessments of the advanced economies. Similarly, the European Commission has becomemuch exercised by what it sees as the inferior competitiveness of the European Union, andhas set as one of its goals the catch-up of EU competitiveness with that of the US by 2010.Likewise, the UK government has placed the need to boost national competitiveness at thecentre of its policy agenda.This concern with competitiveness has quickly spread to regional, urban and localpolicy discourse. Growing interest has emerged in the ‘regional foundations’ of nationalcompetitiveness, and with developing new forms of regionally-based policy interventionsto help improve the competitiveness of every region and major city, and hence the nationaleconomy as a whole. In the UK, for example, the Government has assigned increasingimportance to the competitiveness of the country’s regions and cities as part of its re-orientation of national and regional policy (HM Treasury, 2001, 2002; DTI, 2001; ODPM,2002, 2003). In the EU, the issue of regional competitiveness has taken on particularsignificance not only in relation to its aim to close the ‘competitiveness gap’ with the US,but also as part of its pursuit of social and economic cohesion. Raising the competitivenessof Europe’s lagging and less prosperous regions is regarded as crucial to social cohesion,especially in the context of monetary union and EU enlargement. In fact, a still small butrapidly growing literature now exists on the topic of ‘territorial competitiveness’ (see, forexample,).However, this new focus on ‘place competitiveness’ raises a host of questions as towhat, precisely, is meant by the competitiveness of regions, cities and localities. In whatsense can one talk of regional competitiveness? In what sense do regions and cities