The evolution of biotechnology in bioregions and their globalisation

Abstract

For those who study industry organisation and its contemporary economic geography, biotechnology is intrinsically challenging. Moreover, biotechnology clusters are interesting and important intellectually and for policy deliberation. They pose questions about basic cluster theory because localised networks, though intense, may not be as extensive as global ones in firm practices, especially as these evolve over time. Moreover, innovation is more deeply embedded in the publicly funded science base than for 'Porterian' clusters. Regarding innovation, biotechnology is also less obviously Schumpeterian, there being little market-driven 'creative destruction', and is arguably, with its strong emphasis on both large and small firm 'capabilities' – Penrosian &ndash an emphasis in clustering research and applications that warrants further investigation. Finally, at the specific technology-exploitation phase, market interactions assert themselves over milieu characteristics because scientists know the value of their discoveries and there is accordingly high appropriability associated with such knowledge capabilities. But as Owen-Smith and Powell (2004) have shown 'open science' conventions also apply. This makes such clusters irresistible as locations even for 'big pharma' due to localised knowledge spillover opportunities. Thus while biotechnology appears a rather narrow field, its applications are so wide in health, agro-food, energy and environmental sectors that it is becoming a core competence across a substantial segment of the global economy.