Technological strengths in mature sectors - An impediment or an asset for regional economic restructuring? The case of multimedia and biotechnology in Baden-Wurttemberg

Baden-Württemberg's innovation system, which is characterised by a high degree of institutionalisation as well as a predominance of incremental innovations and medium technology finds itself in a profound process of transition. The paper discusses whether Baden-Württemberg's strength as an industrial district dominated by mature industries is an impediment or rather an asset with regard to developing new promising technological sectors in the region. The paper focuses on two newly emerging sectors: multimedia and biotechnology. Because of the strong orientation of actors in Baden-Württemberg to established companies in the core industries and the dominance of established organizational networks there is a lack of stimuli for developing new industries. Thus, institutional innovation and new networks are required to speed up the growth of the new industries. Baden-Württemberg can be expected to cope with the transition to the extent that it builds a close connection between its existing sectoral strengths and the new growth industries. © 2002 Kluwer Academic Publishers.