Can Innovation Districts Encourage Inclusive Growth?
Jeremy Williams, Hope McGee
Over the last 30 years, cities across the world have sought to encourage economic growth and innovation through instituting Innovation Districts – the geographic clustering of research and development, usually around an anchor institution like a major university or large company.
While many of these districts have been successful, they have also run up against the challenge encountered by most urban regeneration strategies: how to ensure the benefits are shared with local people, as well as mitigating against side effects such as gentrification.
As part of IPPO’s work with governments to provide the best evidence to help them combat spatial inequality, we are focusing on the role of innovation districts in boosting economic growth and productivity – but also to ensure they provide positive outcomes for, and are oriented around the needs of, local people.
UK government investment in innovation is increasing. Initiatives include setting up regional accelerators and committing to increase R&D spending to 2.4% of GDP by 2027 (its highest level ever). Many local authority-driven innovation district projects are also emerging from Leeds to Belfast. Against this backdrop, it is an important time to ask how policy can encourage fairer place-based models of innovation.
What Makes Innovation Work?
Creating a place-based innovation ecosystem requires finding a balance of many different factors. These include the presence of an anchor institution, an existing culture of innovation, a network of companies, private and public capital investment, and an infrastructure – physical and social – that work to attract talent.
A successful innovation district requires its own balance between these factors, given that every geographical region is different. While it can be relatively straightforward to determine the factors that drive successful districts – replicating these strategies in different contexts is far more challenging.
Also, with more positive testimony available than frank comparative studies, uncovering evidence about less successful examples is also difficult.
Innovation districts have encountered problems such as over-construction, where sites are left empty and unused, objections from existing residents over development plans, and financial gains going to foreign investors, rather than the local community.
Growth and Equity
In common with other place-based regeneration strategies co-ordinated from the top-down, innovation districts can potentially play a role in displacing local people as property prices increase, re-orienting the character of the area and increasing social division, as new people arrive.
Examples of community activism against these or similar strategies, such as that in Berlin against a new Google campus, or criticism of NYU’s role in the gentrification of Lower Manhattan, show the issues that can arise when local people feel they are not benefitting from regeneration or investment.
While there have always been trade-offs to be made between economic growth and equity, the place-based nature of innovation districts and adjacent regeneration strategies brings these dynamics into focus for the communities affected.
Tools Available
There are numerous examples of tools deployed by successful innovation districts to encourage and nurture the benefits of growth for local people. IPPO is collecting evidence on the possible interventions available to an innovation district or a city government to help build community wealth, which we discuss in our upcoming roundtable.
In the area of employment, these can include the development good work charters, living wages or local talent pipelines.
Within education, tools can include collaborations with local schools, public events, and real-life testbeds to tackle local issues and encourage a startup culture amongst young people.
Local business, particularly SMEs, can be encouraged to take part in the district through funding challenges, procurement targets, affordable start-up space and business support, and building on the ingenuity of local people.
Likewise, innovation districts can make social impact central to their mission, targeting investment and human capital towards tackling pressing social issues, such as the UK’s ageing population and growing climate crisis.
IPPO’s Work
IPPO is working with central, regional, and local government, to provide evidence, knowledge, and best practice on how Innovation Districts can use these tools and more to drive innovation that puts residents front and centre.
Our work includes roundtables and stakeholder engagement, mapping – using systems thinking to plot how innovation districts can build community wealth – and a Rapid Evidence Review produced by UCL’s EPPI Centre. These areas of work will all feed into our forthcoming White Paper and Policy Brief of steers and warnings to ensure Innovation Districts benefit the broader community.
Mapping the System
Through our initial systems mapping session with experts from across the UK, we were able to understand the core inputs and challenges faces by those working on developing innovation districts. We plotted out actors’ policies and practices, case studies and actors, which you can find on our broader Systems Map.
Here you can search for individual elements, identify academic references and look through different views from the whole ecosystem to the national levers.
By evaluating the strength of evidence and information for each element, we have started to identify core components, as well as unintended outcomes.
We have also homed in on the, often tactical, practices that can bring benefit to a larger set of existing residents – helping them to share in the economic growth brought by innovation.
Get Involved
To discuss these issues and more, IPPO is hosting a public online roundtable on Tuesday, July 2nd, 2024, at 3 pm BST (UK time) for 60 minutes. The session will feature examples of best practice for inclusive innovation from across the world, as well as contributions on what we know from expert academics. There will also be the opportunity to contribute to the discussion. Sign up for free here.