- intensive business services ( KIBS ) as an element of learning regions - the case of Baden - Württemberg

Knowledge-intensive business services (KIBS) as an element of learning regions-the case of Baden-Württemberg ABSTRACT: The paper focuses on the contribution of knowledge intensive business services (KIBS) to innovation from a qualitative perspective, using the systems of innovation approach. The main argument is that KIBS play an increasing role in the production and diffusion of knowledge under the current globalizing economy. The strategic significance of KIBS in the innovation systems stems primarily from indirect effects and positive feedbacks that in the long run can increase the capacity of the demand side to adjust and thus contribute to improving competitiveness. These effects are the results of successful interaction-and learning processes between KIBS suppliers and KIBS users, shaped and influenced by the institutional context. The paper examines the specific development trends of KIBS in the regional innovation system of Baden-Württemberg and discusses the consequences of their developments for the adaptability and competitiveness of the region. 1 Knowledge-intensive business services (KIBS) as an element of learning regions – the case of Baden-Württemberg 0 Introduction The growth and dynamic development of business services in the European countries has now been documented in numerous empirical studies. However, their significance and their role in the innovation process has received far less attention. A major reason for this is the difficulty involved in quantifying them at both the macro and the micro levels. There is no way this can be done at present, given the state of the statistics on services and innovations. From a qualitative perspective, the strategic significance of these services in the innovation systems stems from the fact that their use contributes to the change and learning processes in firms and institutions. Here the interaction with the demand side is of great importance. The interaction process gives an impetus to innovating and provides a means of transmitting innovations. Indirect effects and feedbacks can thus be the result. These effects, which increase both efficiency and competitiveness, are hard to observe because it is difficult to isolate the specific contribution made by knowledge intensive service firms from the network of intra and inter organizational exchange relationships in innovation processes. In the following it will be shown that KIBS influence the adaptability and flexibility of regions, as the globalization process accelerates and the production of knowledge is changing. They are therefore obviously worth studying especially when thinking about the institutional conditions for learning regions. The serious limitations of …