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Related variety

Top decorative frame: green city / Frise décorative: ville verte

This approach was coined by Frenken et al.* et Ron Boschma**. It offers a theoretical and practical framework for local economic development strategies.

 

Definition

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  • A meso-economic approach, i.e. at metropoles, province or region level

  • Seeking to maximise value created by economic players:

- Considering all existing industries

- Going beyond the diversification and specialisation opposition (better resistance to economic shocks vs. better competitivity)

- Therefore diversifying local economy leaning on existing capacities

 

*K. Frenken, F. Van Oort et T. Verbur, 2007, Related Variety, Unrelated Variety and Regional Economic Growth, Regional Studies, Vol. 41.5, pp. 685–69

**R. Boschma, 2005, Proximity and Innovation: A Critical Assessment, Regional Studies, Vol. 39.1, pp. 61–74

 

Strategy

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  • Encourage diversification and new activities in connection with local attributes and assets 

  • No new competence must be created without complementarity, meaning, for instance, compatibility with existing capacities or response to a need

  • Compose with existing operators as a robust capacities and skills base, to be fleshed out and developed

  • Optimize the capacity to reorganise and benefit from former and new competences*

 

Tools

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  • Spin-offs or new firms stemming from existing industries

  • 'Recombinations' of existing skills on new activities

  • Foster experimented entrepreneurs

  • Reinforce existing capacities through 'thickening' or surpassing them

  • Connections with neighboring areas or beyond, as to benefit from systems or ripple effects

 

*This is how Schumpeter intends the creative destruction process, ('the essential fact about capitalism'), a less brutal process than commonly thought

 

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The 'modular approach of regional innovation', coined by Philip Cooke, completes related variety. It considers industries or value chains as 'modules', meant to be connected or integrated in order to spur innovation.

 

Circular economy aligns well with this idea, by linking different industries for waste valorisation.

 

*P. Cooke, 2013, Towards DUI Regional Innovation Systems, Papers in Evolutionary Economic Geography

 

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>> Inecko uses these approaches for example in its strategic reccomendations, or to assess the long-term impact of a given project.

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