SME policy and the Regional Dimension of Innovation: Towards a New Paradigm for Innovation Policy?

Based on the empirical findings achieved in a comparative research,involving 40 innovation policy instruments in 11 European regions, thispaper exposes the claim for a new innovation policy paradigm andproposes a shift in rationale and in broad orientations for innovationpolicy, addressing SMEs in their regional context. The main role forinnovation policy, which aims to increase the capacity of a region andthe capabilities of its SMEs to innovate, is to foster interactive learningwithin the firms and within the region. This calls for an interactivemode of policy intervention.The paper also deals with the question of how to build a coherentportfolio of policy instruments, taking into account both regionalsituations and specific SMEs needs in terms of innovation. The keymessage delivered is that there is no "one-size-fits-all" policy portfolio.Regional differences in innovation capabilities call for a tailored mix ofpolicy instruments. One salient element of the conclusion is the need formore "policy intelligence" in this complex field.