Skills for smart specialisation: Relatedness, complexity and evaluation of priorities

The smart specialization concept requires regions to design their strategies based on regional capabilities and strengths. The present study provides a framework to empirically integrate regional capabilities in the form of workplace knowledge and skills with the smart specialisation concept. The smart specialisation concept requires a thorough assessment of regional capabilities and strengths to be able to define region-specific policies to reach innovation-led growth. %However, the empirical smart specialisation literature does not explicitly account for regional capabilities even though the policy design and evaluation should ideally be drawn on them. The present study proposes a framework that is based on regional workplace knowledge and skills which are good proxies of regional capabilities. In this regard, it evaluates the smart specialisation priorities of regions with respect to their industry spaces built upon regional skill bases characterised by skill relatedness and skill complexity measures. By doing so, it analyses to what extent smart specialisation strategies are built on regional capabilities and strengths. It shows that regional heterogeneity plays an important role in the smart specialisation policy design. High income regions tend to prioritise industries in which they have enough capabilities while low income regions opt for new production paths.