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Papers in Innovation Studies

Paper no. 2016/1

Institutional Thickness Revisited

Elena Zukauskaite (elena.zukauskaite@circle.lu.se)


CIRCLE, Lund University
Monica Plechero (monica.plechero@circle.lu.se)
DEAMS, University of Trieste and CIRCLE, Lund University
Michaela Trippl (michaela.trippl@circle.lu.se)
CIRCLE, Lund University

This is a pre-print version of a paper that has been submitted for


publication to a journal.
This version: January 2016

Centre for Innovation, Research and Competence in the Learning Economy (CIRCLE)
Lund University
P.O. Box 117, Slvegatan 16, S-221 00 Lund, SWEDEN
http://www.circle.lu.se/publications
WP 2016/1

Institutional Thickness Revisited


Elena Zukauskaite, Monica Plechero and Michaela Trippl

Abstract
Over the last two decades, the notion of institutional thickness has become a key reference
for a large body of work that has sought to provide profound insights into the link between
institutions and regional development. However, only few attempts have been made to
reassess the concept, to improve its methodology and to reflect upon its empirical
application. The aim of this paper is to identify some crucial limitations of the theoretical and
empirical work on institutional thickness and to sketch out elements of a strategy that could
help to advance the debate on the notion. It is argued that much can by gained by (1)
employing a clear analytical distinction between the organizational and institutional
dimensions of thickness; (2) moving beyond overly static views on thickness; (3) developing
a multi-scalar approach to thickness; and (4) acknowledging that thickness can only be
assessed in relative terms.

JEL codes: D29; O18; P48

Keywords: Institutional thickness; Institutions; Organizations; Multi-scalar analysis

Disclaimer: All the opinions expressed in this paper are the responsibility of the individual
author or authors and do not necessarily represent the views of other CIRCLE researchers.
Institutional Thickness Revisited

Elena Zukauskaite
CIRCLE, Lund University, P.O Box 117, SE-22100 Lund, Sweden.
Elena.Zukauskaite@circle.lu.se

Monica Plechero,
DEAMS, University of Trieste, Piazzale Europa 1 - 34127 Trieste.
CIRCLE, Lund University, P.O Box 117, SE-22100 Lund, Sweden.
Monica.Plechero@circle.lu.se

And

Michaela Trippl
CIRCLE, Lund University, P.O Box 117, SE-22100 Lund, Sweden.
Michaela.Trippl@circle.lu.se

1
Abstract

Over the last two decades, the notion of institutional thickness has become a key reference for

a large body of work that has sought to provide profound insights into the link between

institutions and regional development. However, only few attempts have been made to reassess

the concept, to improve its methodology and to reflect upon its empirical application. The aim of

this paper is to identify some crucial limitations of the theoretical and empirical work on

institutional thickness and to sketch out elements of a strategy that could help to advance the

debate on the notion. It is argued that much can by gained by (1) employing a clear analytical

distinction between the organizational and institutional dimensions of thickness; (2) moving

beyond overly static views on thickness; (3) developing a multi-scalar approach to thickness; and

(4) acknowledging that thickness can only be assessed in relative terms.

Keywords: Institutional thickness; Institutions; Organizations; Multi-scalar analysis

JEL: D29; O18; P48

2
1 Introduction

Explaining how institutions shape regional development has long been a recurring focus of

enquiry in economic geography and innovation studies. Scholarly work has highlighted that

institutions have a pervasive influence on the socio-economic evolution of regions. They

condition, enable and constrain the economic vitality and innovation capacity of regions,

providing legal frameworks for actions, defining communication patterns and affecting learning

possibilities (Martin 2000; Gertler 2010).

Many contributions dealing with the role of institutions in regional development refer to and

have been inspired by Amin and Thrifts (1994) work on institutional thickness. This concept

has become a key reference work of what has been called the institutional turn in economic

geography. Indeed, the notion of institutional thickness has been widely used, offering crucial

insights into a set of non-economic factors that underpin regional economic development.

Notwithstanding its enduring popularity, the concept of institutional thickness is not without its

shortcomings, and interestingly, apart from a few notable exceptions (see, for instance, MacLeod

2001; Coulson and Ferrario 2007), over the past twenty years surprisingly little has been done to

further elaborate on the conceptualization of institutional thickness or to improve its

methodology in substantial ways.

The aim of this paper is twofold: First, we intend to identify some crucial limitations of the

concept of institutional thickness and highlight a number of problems that have thus far remained

unresolved. Second, we seek to sketch elements of a strategy that could help advance the debate,

addressing some key conceptual and methodological issues. We contend that there are several

3
key shortcomings that loom large in the debate on institutional thickness. Based on this critical

review, a number of suggestions for future work are offered. We see considerable value in (1)

distinguishing between the institutional and organizational dimensions of thickness; (2)

developing a more dynamic view on thickness; (3) advocating a multi-scalar approach to

thickness; and (4) assessing thickness in relative terms.

We outline how these issues could be addressed in conceptual terms and highlight which

methodological improvements need to be made to gain new insights into the nexus between

organizational and institutional thickness and regional development.

The strategy sketched in this paper may not only contribute to a redefinition of the original

concept of institutional thickness. It could also enrich economic geography more broadly by

informing current attempts that aim to bring together institutional and evolutionary perspectives

to explain how institutions (and organizations) affect forms and directions of long-term regional

industrial change.

2 Institutional thickness: a critical review of the literature

Amin and Thrifts (1994) work on institutional thickness is one of the most-cited contributions in

economic geography and regional studies that aim to treat institutions seriously. This section

offers a brief review and critical discussion of the original concept and of the theoretical and

empirical literature that has emerged since the notions introduction in the 1990s.

4
2.1 Original concept and its theoretical development

The origin of the institutional thickness concept can be found in the seminal work of Amin and

Thrift (1994). They define institutional thickness as a simultaneous collectivization and

corporation of economic life, fostered and facilitated by particular institutional and cultural

traditions (Amin and Thrift 1994, 15). According to the authors, it is associated with four

factors: a strong local institutional presence; high levels of interaction between local

organizations; a structure of domination and/or patterns of coalition; and a mutual awareness of

being involved in a common enterprise. A strong local institutional presence refers to the

existence of a variety of different organizations such as groups of firms, financial bodies,

governance organizations, unions, associations, and business service organizations. The second

factor points to the importance of formal and informal knowledge exchange and cooperation

among those organizations. Those interactions are often embedded in place-specific rules, norms,

and conventions. A structure of domination is defined by the relative power and power base of

different organizations. It is strongly influenced by their (access to) resources. Finally, the fourth

factor is the outcome of the other three. Through strong presence, interactions, and a certain

type of structure of dominations, the actors become aware that they are involved in a common

enterprise; they have a common agenda which they develop and depend on.

Amin and Thrift (1994) have applied the concept to local and regional levels, such as the City of

London or Silicon Valley, to explain why some locations are more successful than others in an

increasingly globalized world. The authors relate thickness to legitimacy, trust, and stimulation

of entrepreneurship, and argue that it appears to have been central to the generation of success

of neo-Marshallian modes in global networks (p.15). However, it is also acknowledged that

5
institutional thickness may hinder the successful development of regions. This insight relates to a

negative lock-in when previously successful institutions become outdated and hamper renewal

and the establishment of new practices (Asheim 2000).

While many studies in economic geography have later been directed to investigate the

institutional aspects of economic development, the research following Amin and Thrifts work

has until now only led to a limited theoretical advancement of the original concept. Scholarly

work has often settled for a short mention of institutional thickness when discussing or analyzing

institutions in economic geography (Farole, Rodriguez-Pose, and Storper 2011; MacKinnon et al.

2009; Storper 1997; Beer and Lester 2015). Moreover, many of these studies have primarily

focused on successful and well-known regions in developed economies (particularly in the EU).

Gibbs et al. (2001), in analyzing the institutional capacity in a peripheral region, argue that the

literature on institutional thickness has until now mainly focused on the presence of institutions

while underestimating the efficiency of those institutions. Rodriguez-Pose (2013) suggests, too,

that because of the role that informal institutions might play in development and the complex

interrelations of institutions with a number of context-specific factors, assessing density may be

not only difficult but also insufficient. Other scholars, such as Faulconbridge (2007), in

analyzing the effect of institutional thickness on collective learning processes, also suggests

investigating the efficiency (or what the author calls strength) of institutional thickness (as

opposed to solely presence).

Although most of the studies on institutional thickness focus on the institutional conditions in

specific regions, some more-recent contributions have underlined that in a globalized world

6
regional economic development may indeed be also influenced by factors external to the region

(for example, by a productive structure that is dominated by externally controlled, foreign-owned

establishments located in the region, institutions at higher spatial scales, and so on) (Fuller 2005;

Gertler 2010; Fromhold-Eisebith 2002; Crescenzi, Rodrguez-Pose, and Storper 2012; Yeung

2009). The idea of a multi-scalar approach to institutional thickness (see also section 3) is

supported by other authors. Jones and Clark (2000) advocate a refinement of institutional

thickness by introducing the concepts of consensus institutions (informal) and concrete

institutions (formal), as well as accounting for the role of individuals in changing institutions.

Their analysis reveals the complexity of institutional thickness where institutions at different

geographical levels contradict each other in their goals, while powerful actors in the region

operate within this complexity and lead the process of transforming consensus institutions into

concrete institutions. This suggests that the power of dominance also depends on the ability of

actors to introduce new institutions which are binding on others. Beer and Lester (2015) add

history of success in engaging with external political and administrative processes as one of the

indicators for institutional thickness. According to the authors, such interaction is needed for

regions to achieve higher growth rates since central governments often are important providers

of resources. Furthermore, a successful interaction also points to well-developed institutional

arrangements at the regional level.

MacLeod and his colleagues also criticize the original concept of institutional thickness for

neglecting institutions at other geographical scales and for excluding the role of the state in the

definition of institutional thickness. Drawing on neo-Gramscian state theory (Macleod and

Goodwin 1999) and on the Regulation Approach (MacLeod 2001), they highlight the importance

7
of regulative institutions and conscious decisions by the state in constructing and mediating

institutional thickness at the regional level. They also warn that public support organizations

promoting networking activities (which appear to be among the preferred units of analysis in

studies of institutional thickness) will have little effect on regional development if not combined

with renewed regulatory and industrial practices. While their work makes a valuable contribution

to the use of new institutionalism in economic geography, their aim is not to reassess the concept

of institutional thickness.

To summarize, over the past 20 years or so only few attempts have been made to re-assess and

elaborate on the concept of institutional thickness. In a next step, we offer a brief review of the

empirically oriented literature and of some methodological issues that have been raised in the

scholarly debate on the notion.

2.2 Empirical applications and methodological challenges

Very seldom are all four factors of institutional thickness (as suggested by Amin and Thrift

(1994)) explored in empirical applications of the concept. Among the few exceptions is the study

by Henry and Pinch (2001), in which the four factors of institutional thickness are used as an

analytical template to investigate the development of Britains Motorsport Valley, highlighting in

particular the importance of non-public organizations for economic development.

Our review of the empirical literature suggests that many analyses of institutional thickness focus

on a rather narrow set of organizations, namely business support organizations and the roles and

activities performed by them. Bassett et al. (2002), for instance, investigate institutional

8
thickness in Bristols media cluster through an analysis of two types of support for companies:

the festival and the development of formal, technical networks between local firms. Another

good example is the contribution of Keeble et al. (1999) who have examined the level of

institutional thickness in the Cambridge region through a survey of technology-intensive SMEs

to assess support provided by the science park infrastructure and local services.

Drawing on single case studies appears to be the dominant method used in empirical applications

of the concept. Studying single cases might provide valuable insights into the institutional

structures of particular places. However, such an approach does not allow for validating tools for

measuring institutional thickness that are more general in nature or applicable to different

contexts. When a comparative approach has been applied, the analysis has only focused on some

aspects of the institutional thickness of specific clusters and industries. Sydow and Staber (2002),

through semi-structured interviews conducted in two media regions in Germany

(Cologne/Dsseldorf and Berlin/Babelsberg), have compared the interaction structure among

agents and dynamics in time and space of project networks at the regional scale. Faulconbridge

(2007) has discussed institutional thickness in relation to collective learning, comparing

advertising and law clusters in London and New York. Tdtling et al. (2011), through a survey,

have analyzed the ICT clusters in two Austrian regions (Vienna and Salzburg) and the spatial

pattern of firms knowledge links. In a similar vein, Chaminade and Plechero (2015) have

empirically investigated the relation between regional institutional thickness and global

innovation networks in developed and developing regions with a strong specialization in ICT.

Whilst these studies have yielded valuable insights into some dimensions of institutional

9
thickness, they offer little inspiration for outlining the contours of a more comprehensive

comparative approach that takes all aspects of the notion into account.

Some attempts to develop quantitative indicators (Coulson and Ferrario 2007; Ersoy 2011;

Escobal and Ponce 2011; Beer and Lester 2015) can also be found in the literature. However, so

far these attempts have mainly focused on measuring the presence of organizations in regions.

The indicators used are very loosely related to the concept of institutional thickness and the

efficiency dimension has only partly been addressed. A notable exception is the work by

Coulson and Ferrario (2007), who have developed measures of all the factors that together form

institutional thickness. However, their work also suffers from several shortcomings. Coulson and

Ferrario (2007) reduce institutions to organizations and they do not discuss explicitly the relation

between presence and efficiency. Furthermore, they do not suggest any indicators for classifying

regions according to their degrees of institutional thickness.

3 Towards a redefinition of institutional thickness

Twenty years after the introduction of the notion in the literature, research on institutional

thickness still shows ambiguities and limitations in terms of both the theoretical development of

the concept and analytical operationalization. In this section, we identify some of the main issues

and outline elements of a strategy that could help to redefine the concept.

3.1 Institutions or organizations?

As mentioned above, institutional thickness is associated with a strong local institutional

presence. Amin and Thrift (1994) as well as many other scholars tend to equate institutional

10
presence with the existence of a variety of different organizations in the region. Indeed, scholarly

work on institutional thickness conflates organizations and institutions (Coulson and Ferrario

2007) and does not discuss whether there is any difference between the two terms.

There is still no consensus in economic geography about the relation between organizations and

institutions. This is particularly visible in the innovation systems literature, which considers

institutions as eminently important for the development of regions or nations. Inspired by new

institutional economics (North 1990), many authors define institutions as rules of the game

which organizations (players) have to follow (Edquist and Johnson 1997; Asheim and Gertler

2005; Edquist 2005; Johnson 2010; Lundvall 2010). However, most of the empirical

applications, especially in regional innovation systems research, focus on institutions as

organizations (such as research bodies, governments, and venture capital organizations) rather

than more broadly on the institutional environment (the legal system, norms, and so on) (Farole,

Rodriguez-Pose, and Storper 2011). In other words, attention is given to the presence of various

organizations, which would correspond to organizational rather than institutional thickness.

Some attempts to relate the notions of organizations and institutions have been made in

innovation studies and the literature on the geography of innovation. Following organizational

theorists (Meyer and Rowan 1977; DiMaggio and Powell 1983), Hollingsworth (2000, 619)

suggests that institutional rules, norms and conventions unfold in tandem with organizational

structures and therefore such an interrelated perception of institutions and organizations could

be useful for an institutional analysis of innovation. This idea is also supported by Gertler and

11
Wolfe (2002), who perceive organizations as a part of (nested in) institutions in the form of rules,

habits, and routines in their discussion on innovation and learning processes.

The notion of institutional thickness retains a similar conflation of organizations with institutions

as shown above. According to Jessop (2001), when different organizations interact they generate

a shared understanding, common agenda, and trust. Thus, in the analysis of institutional

thickness, organizations are mechanisms via which institutions (such as trust, positive attitudes to

learning, and knowledge exchange) are created and mediated (Raco 1999; Faulconbridge 2007).

A critical mass of actors is needed to both create and enact institutions (Zukauskaite 2013) since

too little organizational presence might hamper the successful development of regional

economies (Tdtling and Trippl 2005). Such a conflation, although it might be conceptually

explained, may also have some limitations. First, there is a risk that institutional thickness will

simply be equated with a large number of organizations, especially public and quasi-public

support organizations (Henry and Pinch 2001). Second, the fact that organizations might become

mechanisms for creating institutions does not mean that they by definition do that (Raco 1999).

Although organizations might be created relatively quickly and easily (with enough resources at

hand one can establish support organizations, research and education bodies, etc.), it might take a

much longer time to develop institutions since institutional change is often slow and incremental

(Mahoney and Thelen 2010). Third, institutional thickness might have dimensions other than

organizational thickness (MacLeod 2001). For example, normative institutions in the region

might support collective learning and knowledge exchange among actors without formal

associations or other support organizations promoting such activities. Such norms might emerge

through democratic values which are often enacted at local and regional levels (Amin and Thrift

12
1995). There are thus some compelling reasons for analytically separating organizational and

institutional thickness.

Towards an analytical distinction between institutional and organizational thickness

Mapping institutions and organizations as separate entities would provide a more fine-grained

analysis of factors underpinning regional development since it would allow for a more precise

identification of the strengths and weaknesses of the specific context under analysis. Adopting

such a strategy might, for example, help to establish greater clarity and specification of the

factors hampering regional development: are they related to the lack of particular organizations

or are they an outcome of missing, inappropriate or contradicting institutions? Furthermore, such

a distinction would also direct attention to the nature of the relation between institutional and

organizational thickness. For example, the establishment of new organizations that provide

support for networking activities in the region might be the result of specific institutions already

in place (openness for knowledge sharing, trust, and willingness to learn from others, and so on),

and it might foster the further development of such institutions, but it might instead have no

effect if actors are reluctant to get involved in such activities or, possibly, are not even aware of

the existence of such organizations (see, for instance, Martin, Moodysson, and Zukauskaite

2011). In other words: an increase of organizational thickness (at least in terms of efficiency)

might increase institutional thickness or not have any impact at all. The arguments raised above

could provoke a set of new questions that might be addressed in future research. When and how

(if at all) does organizational thickness contribute to the development of institutional thickness?

What are the mechanisms for creating institutional thickness in places that suffer from a lack of

well-functioning organizations?

13
The possibility of differentiating between institutions and organizations is closely related to the

issue of finding indicators for measuring these two aspects with regard to presence and

efficiency. The differentiation is also crucial for assessing on what basis the region can be

labeled as thick or thin. To elaborate extensively on the methodological operationalization of the

concept is beyond the scope of this paper, though some suggestions can be made.

First, we argue for a broad understanding of organizations when discussing the notion of

organizational thickness. In contrast to many studies, which have mainly focused on business

and innovation support organizations, we see considerable value in taking account of the role

played by a larger variety of organizations. Indeed, actors other than support organizations might

be equally or even more important in affecting regional development (Henry and Pinch 2001). It

is therefore relevant to include firms and to take account of the structure of different industries

and the relation between large and small firms. Furthermore, due attention should also be given

to research and education organizations in analyses of organizational thickness. Industrial

diversity, the combination of large and small firms, and the presence of research and educational

bodies can provide some significant indications for the organizational efficiency of the region.

Regions with diversified industrial structures and hosting well-performing research and

education organizations are more likely to be innovative and show a strong performance of

economic development (Isaksen and Trippl 2014). In addition, the efficiency of the firms could

be assessed by looking into turnovers, introduction of innovations, expenditure on innovation,

and, as suggested by Beer and Lester (2015), the level and type of education of employees. The

efficiency of research and education organizations might be assessed by employing indicators

14
used in university rankings, or in more qualitative ways, by investigating how these

organizations are perceived by other stakeholders in the region. The perception by other actors,

together with information about funds obtained for the development of the region, can help to

assess the efficiency of governmental and support organizations (Beer and Lester 2015).

We suggest defining institutions as rules of the games including formal and informal rules such

as regulations, laws, values, norms and attitudes (North 1990; Scott 2008) when discussing the

notion of institutional thickness. Some tools for assessing particular aspects of institutions

defined in such a way are already available. The Global Competitiveness Index and the

Worldwide Governance Indicators are instruments to measure and compare, for example, the

level of corruption, the quality of governance, attitudes toward collaboration, and knowledge

exchange. They might be complemented by other indicators which could be developed for a

concrete case region or for aspects and comparison not already covered by the available national

and regional data.

To sum up, we consider institutional thickness to be related to regulations, norms, values and

attitudes and organizational thickness to be related to firms, universities, governmental agencies,

support and other organizations. The original concept of institutional thickness covers both

aspects, which are clearly distinguished from each other and referred to as organizational and

institutional thickness in this paper.

15
3.2 Institutional and organizational thickness: statics or dynamics?

Many studies provide snapshots of organizational and/or institutional thickness. However, the

institutional and organizational structures (presence and efficiency of institutions and

organizations, and the relations between different types of institutions and between different

types of organizations) of the region often change over time, making a static analysis ill-suited to

grasping their evolution (Gertler 2010; Rodrguez-Pose 2013).

The question of how institutional thickness evolves is still poorly understood. Jones and Clark

(2000) suggest analyzing institutional thickness as a process rather than a stable result. However,

they do not provide any tools for investigating changes in the four constitutive elements of the

original notion of thickness. Instead of conceptualizing the dynamics and evolution of thickness,

the concept is applied as a meta-term for institutional analysis. Jones and Clark (2000) focus on

consensus and concrete institutions and seek to explain institutional change by studying how

informal patterns develop into formal rules.

Analyzing changes of institutional thickness over time is a challenging task. One difficulty

concerns the direction of causality between thickness and the phenomenon under study (Coulson

and Ferrario 2007). Arguably, the problem of causality is not confined to the debate on

institutional thickness. It is a frequent phenomenon in institutional analysis in economic

geography and other disciplines. Maskell and Malmberg (2007) point out that institutions are

often measured by their outcomes (that is, activities) which lead to circular arguments: the

territories that perform well are equipped with a well-functioning institutional structure, while a

well-functioning institutional structure is found in the territories that perform well. Farole,

16
Rodriguez-Pose, and Storper (2011, 73) claim that the relation between institutions and

economic growth is endogenous:

Institutions and economic growth co-evolve with changes in capacity building and

improvements in governance contributing to the development of economic activity

and vice versa.

It is also important to bear in mind that institutions do not exist outside a specific context of

actions (Jessop 2001). Actions are shaped by specific institutional structures, while at the same

time actors have some freedom of choice and, therefore, can reflect upon and change institutions

(see also Hollingsworth 2000; Hodgson 2003). However, institutional change is slow and

incremental (Mahoney and Thelen 2010). Thus, in the short term, activities are most likely to be

an outcome of the institutional structures, while in the long term the impact of activities on

institutions can be identified. For example, Phillips et al. (2015) argue that initially organizations

and individuals depend on institutions for an efficient distribution of knowledge; as knowledge

accumulates, organizations start to outpace the institutional structures, possibly leading to

changes in the institutions themselves. Furthermore, although the relation between institutions

and activities is endogenous, it is still worth analyzing how, when, and which institutions

influence different social phenomena in order to gain a better understanding of their development

(Farole, Rodriguez-Pose, and Storper 2011). Finally, if changes in institutions can be clearly

identified (for example, a change in a particular regulation), a time lag between the change in

institutions and activities under investigation could be introduced in empirical analyses to

address the issue of endogeneity (Srholec 2010; Goedhuys and Srholec 2015).

17
Towards a dynamic view on institutional and organizational thickness

In order to analyze how institutional and organizational thickness evolves over time, we need to

gain a better understanding of the processes and mechanisms of institutional and organizational

change. Gertler (2010) suggests adapting the theoretical advancement made in historical

institutionalism, or, more concretely, the work done by Thelen and her colleagues, to the regional

analysis of institutions. In this stream of literature, it is highlighted that institutions do not

emerge or decline overnight, but rather develop in a subtle, gradual process (Mahoney and

Thelen 2010). At the same time, there are strong reasons to assume that the pace and direction of

institutional change may differ markedly across regions. In places situated in developing

economies, institutional change could be expected to take place at a faster rate and being of a

more unpredictable nature than in areas located in developed countries (Wei, Li, and Wang

2007; Peng, Wang, and Jiang 2008; Gao et al. 2010).

The literature offers various typologies to categorize different forms of institutional change. Hall

and Thelen (2009) argue that institutional change might happen through reform (when

government itself directs and endorses change), defection (when key actors withdraw from

organizations or no longer follow their rules), and reinterpretation (when actors gradually change

their interpretation of the rules without defecting or dismantling the institution itself). However,

this typology does not cover situations where new rules are created in combination with old ones

or where old rules are totally abolished. More recently, Mahoney and Thelen (2010, 15) have

introduced four modes of institutional change: displacement (the removal of existing rules and

the introduction of new ones); layering (the introduction of new rules on the top or alongside of

18
existing ones); drift (the changed impact of existing rules due to shifts in the environment); and

conversion (the changed enactment of existing rules due to their strategic deployment). Campbell

(2006, 506) adds the notions of bricolage (new combinations of existing institutions) and

translation (when a new type of institution arrives at a location, it is modified (translated) in

order to fit the already-existing framework). These different typologies point to a variety of ways

by which institutional change might happen and could offer novel insights into the evolution of

institutional thickness and the forms and directions it might take. It would be intriguing to

explore in future studies if particular types of institutional change are more likely to be observed

in some regions than in others. One could expect that layering and translation are common forms

of change in institutionally thin regions, while displacement and conversion are more likely to

take place in regions with thick but hampering institutions. Future studies could also benefit from

incorporating insights from the institutional entrepreneurship literature (Battilana, Leca, and

Boxenbaum 2009) to explore under which conditions and in what ways key individuals and

organizations (or groups of them) influence how institutional thickness changes over time.

Some recent developments in evolutionary economic geography provide frameworks for

analyzing changes in organizational thickness, offering explanations of how new firms and

industries emerge in regions. For example, the notion of regional branching sheds light on how

old industries diversify into new but related ones (Boschma and Frenken 2011). Other scholars

(Martin and Sunley 2006; Trippl and Otto 2009; Isaksen and Trippl 2014; Dawley et al. 2015)

have distinguished between a broader set of types of regional industrial change, ranging from

path extension and upgrading, to path transplantation, and the rise of entirely new growth paths.

19
Future studies could investigate how these different types of path development are related to and

reflected in changes of the organizational thickness of regions.

3.3 Spatial dimension of institutional and organizational thickness

As noted above, a common criticism levied against the original concept of institutional thickness

is the neglect of a multi-scalar perspective (Macleod and Goodwin 1999; MacLeod 2001; Jones

and Clark 2000). The importance of adopting a multi-scalar approach in institutional analyses of

regional development has been acknowledged by many scholars (see also section 2). Already

Martin (1994) has pointed out that regions are places where different institutionslocal,

regional, and nationalmeet.

The argument that it is eminently important to take the interrelatedness between institutions into

explicit account has become prominent in recent years. Advocates of the geography of

production approach have highlighted the complex institutional structures and power relations

among firms and other organizations that exist at different geographical levels and how they

shape spatial and social dynamics of development (Dicken et al. 2001; Henderson et al. 2002;

Coe et al. 2004). Interaction among actors is one of the key factors influencing institutional

thickness. Several studies on knowledge, production, and innovation networks suggest that such

linkages often transcend regional (and national) borders. Consequently, an exclusive focus on

local and regional networks does not suffice to explain the complex geography of interaction

patterns (Tdtling 1999; Martin and Moodysson 2013).

20
Gertler (2010) stresses the importance of institutions at local, national and global levels for

understanding regional economic change. Also, Asheim et al. (2011), in their analysis of regional

innovation systems, highlight the embeddedness of regions in national and global settings. Farole

at al. (2011) emphasize that a balance between society (formal) institutions (mainly found at the

national level) and community (informal) institutions (mainly found at the local and regional

levels) is conducive to economic growth.

To fully account for organizational and institutional thickness in the region, national and global

factors and influences must therefore be taken into account. Henry and Pinch (2001) underline

that the growth of Motorsport Valley benefits from previous state investments in the aircraft

industry (national-level policy decisions). According to Macleod and Goodwin (1999, 514),

national-level policy that influences the operation of those trying to construct an appropriate

institutional thickness at a local or regional scale should deserve due attention.1

Eventually, taking other geographical scales into account becomes especially relevant in

comparative analyses. For example, because of different national policies, the regions in

different countries are subject to different levels of decentralization (Macleod and Goodwin

1999) which in turn shapes the possibilities for regional policy makers to influence regional

development strategies, support innovation activities, and align diverse interests towards a

common agenda for the region (Cooke 2001; Dawley 2014; Dawley et al. 2015; Isaksen and

Trippl Forthcoming).

1
As mentioned earlier, MacLeod and his colleagues have made some efforts to introduce a multi-scalar perspective
into the analysis of institutional thickness. However, similarly to Jones and Clarks (2000) study, rather than
conceptually integrating different concepts, the authors discuss alternative frameworks (Regulation Approach, neo-
Gramscian state theory) as a response to the shortcomings of the institutional thickness framework.

21
Towards a multi-scalar approach to institutional and organizational thickness

Incorporating a multi-scalar perspective into the conceptualization of institutional thickness

requires a revision of notion in theoretical and analytical terms. Since regional development

processes are influenced by institutions at different spatial scales, it is important to understand

how those institutions are related to each other. According to Zukauskaite (2015) institutions can

be related in a complementary, reinforcing, or contradictory manner. More concretely,

institutions have different functions and incentives. Regulatory frameworks set rules and monitor

and sanction activities. Norms and values introduce prescriptive, evaluative, and obligatory

dimensions into social life. They prescribe how things should be done and might be applicable to

all members or just specific individuals of a certain collectivity (society, community, industry,

and so on) (Scott 2008). While performing these functions, institutions create different

incentives. For example, intellectual property rights create an incentive to invest in knowledge

creation and innovation (Edquist and Johnson 1997). Institutions are contradicting when they

provide different incentives. They are reinforcing when they provide similar incentives via

similar functions. They are complementary when they create similar incentives via different

functions. Analyzing the relation between different institutions would provide a better overview

of the institutional presence in the region, and would help to identify at which level supporting

and hampering institutions are scaled.

Firms and other organizations operating at levels other than the local and regional ones (MNCs,

national and international funding and innovation agencies, industry organizations, and so on)

also have an impact on the development of organizational thickness and on the activities of the

22
actors in the region. Paying attention to the importance of non-local actors and trans-local

networks for organizational thickness is particularly relevant when investigating regions which

base their development more on exogenous sources such as peripheral areas in developed

countries (Dawley 2014; Dawley et al. 2015; Isaksen and Trippl Forthcoming) and regions in

emerging economies (Yeung 2009; Fu, Pietrobelli, and Soete 2011). The networks of actors

located in these areas often cross regional and national boundaries to take advantage of well-

functioning institutional environments and organizations elsewhere. Social-network analysis

could provide valuable insights into the multi-scalar dimension of organizational thickness.

Arguably, the empirical execution of a study in which several geographical scales are taken into

account might become very complex, particularly when investigating the institutional dimension

of thickness. However, it should also be noted that not all institutions are equally important for

regional development and innovation (Macleod and Goodwin 1999). Thus, identifying the most

vital ones for consideration in empirical analyses might be a feasible strategy. For example,

when analyzing the impact of thickness on innovation activities, relevant institutions at the

national level could be funding schemes for innovation, tax policies related to innovation (such

as tax reliefs), or national innovation policies/strategies. Focusing on organizational thickness,

studies might restrict themselves to taking only the most important organizations at the national

or international level into account (such as powerful governmental agencies responsible for

innovation or highly ranked research and education organizations with connections to regional

actors). The decision about what to include or exclude from the analysis will depend on the

research question and the specific phenomenon that is investigated.

23
3.4 Institutional and organizational thickness or thinness?

In the analysis of organizational and institutional thickness, one of the key issues to address is

how to distinguish between thick and thin structures. This is a challenging endeavor. Many of the

intangible elements that compose the institutional and organizational thickness such as the

regional structure of domination and/or patterns of coalition, and the mutual awareness of being

involved in a common enterprise make it difficult to develop objective classifications

(Rodrguez-Pose 2013; Chaminade and Plechero 2015). Moreover, it remains unclear how much

variety in organizational and institutional presence, interactions, and commonness in the agenda

there has to be for the region to qualify as thick. What is the relation between the presence and

efficiency of organizations and institutions? Although, as mentioned above, there have been

several attempts to develop indicators for efficiency (Coulson and Ferrario 2007; Beer and Lester

2015), the relation between presence and efficiency and the basis for calling a region thick

remains vague.

Towards an assessment of institutional and organizational thickness in relative terms

There have been attempts in the regional innovation systems literature to develop indicators for

ideal-type cases of organizationally thick or thin regions. Isaksen and Trippl (2014), for instance,

differentiate between thick and diversified, thick and specialized, and thin regions. Thick and

diversified regions host a large number of different industries as well as a variety of knowledge

and support organizations and they often benefit from intensive local and non-local networking.

Organizationally thick and specialized regions are characterized by the presence of one or a few

industries only, a highly specialized organizational support structure and a lower degree of non-

local networking activities. Organizationally thin regions suffer from weakly developed cluster

24
structures and are often poorly endowed with research, education and business support

organizations. This typology provides some useful indicators for discussing organizational

thickness, not only in terms of presence but also in terms of efficiency. It is applicable when

analyzing real-life examples which closely mirror the ideal cases described above.

Discussing organizational and institutional thickness in absolute terms is rather tricky. Is there

any minimum number of firms and support organizations which must be located in the region for

a place to qualify as thick? How much trust or how many interactions must there be? How well-

developed must the intellectual property rights and other laws and regulations be? The fact that

thickness may be time- and space-contingent (Jessop 2001) suggests that thickness can be best

determined in relative terms using comparative studies that analyze several regions at the same

time or the same location at different points in time. Thus, one region can be thicker or thinner in

relation to other regions or it might have become thicker and thinner compared to its own

previous states of development. This calls for a need to employ more comparative and

longitudinal studies in future research.

When analyzing thickness, it is important to deal with the question thick for what?. Amin and

Thrift (1994) discuss thickness in relation to general economic development. However, in further

applications, thickness is discussed with regard to a concrete industry in the region (for example,

motor industry, watch industry, or ICT industry), to collective learning activities (Glasmeier

1994; Henry and Pinch 2001; Faulconbridge 2007), or to innovation or global innovation

networks (Tdtling, Lengauer, and Hglinger 2011; Chaminade and Plechero 2015). These are

of course empirical decisions that depend on concrete research questions. However, making

25
these decisions explicit in the analytical framework might help to avoid ambiguity regarding, for

example, different positive or negative effects of thickness in relation to different phenomena but

also in relation to the specific organizational and institutional settings of a region. Opposite to

relatively thick institutional and organizational structures supporting regional development and

innovation is either a relatively thin infrastructure (lack of organizations and institutions, lack of

common vision, few interactions) or a thick infrastructure, characterized by inappropriate

organizations and institutions which hamper regional development and innovation (imbalanced

power of dominance, joint vision opposing any renewal efforts, closed networks (old boys

networks, inward looking networks), and so on). Organizationally thin peripheral regions are

typical examples of the former, while locked-in old industrial regions are classical examples of

the latter, where existing institutions and organizations hamper possibilities for economic

rejuvenation (Tdtling and Trippl 2005). To summarize, organizational thickness and

institutional thickness do not bring per se advantages or disadvantages for regional development.

Indeed, thickness has to be related to the concrete phenomenon on which it might have either a

positive or a negative impact. Future studies could address these issues more explicitly to

enhance ones understanding of which organizations and institutions support and which ones

hinder development and how such processes differ across regions with thick and thin structures.

3.5 Summary: Redefining the constitutive elements of the original concept

The arguments raised in the previous subsections can essentially enrich the discussion about the

four constitutive elements of the original concept of institutional thickness (Table 1). What

follows is an attempt to offer some brief thoughts on this issue.

26
Strong institutional and organizational presence. Distinguishing between organizations and

institutions, as well as considering not only the mere presence but also the efficiency of

organizations and institutions, would provide a more differentiated picture of the strengths and

weaknesses of a given region. In addition, capturing dynamic and multi-scalar effects by

analyzing how organizations and institutions at different spatial scales evolve over time and to

what extent and in which ways they adapt to industrial and technological change could lead to a

more advanced assessment of organizational and institutional thickness.

High levels of interaction. Regional development is not only shaped by interactions among local

actors, but also between local actors and non-local actors. Consequently, analyses of the

organizational network for the specific case under consideration should include not only regional

but also national and global actors and the evolution/co-evolution of those interactions over time.

Structure of domination. Power lies within both institutions and organizations. Valuable insights

might be gained by examining at which scale important institutions are introduced and enacted,

which organizations at which geographical level have most power to influence regional

development, and to what extent, how and why power balance is changing over time.

Common agenda. While organizations play a vital role in setting the common agenda,

institutions establish the conditions that support (or not) the agenda. Applying a dynamic and/or

multi-scalar approach would allow to study how the common agenda evolves over time and to

explore how non-local organizations influence regional agendas.

27
Assessing the four constitutive elements of thickness in absolute terms is a difficult endeavor. As

mentioned above, a comparative approach may yield valuable insights. A careful analysis and

comparison of each of the four factors might have the potential to uncover relative strengths and

weaknesses of the regions under investigation. For example, one region could be thicker in terms

of organizational and institutional presence and levels of interactions, while another region could

have a more balanced structure of domination and a higher degree of commonness in its agenda.

28
Table 1: Strategies for redefining the four factors of thickness

Strategies Strong presence High levels of Structure of Common agenda


interaction domination
Distinguishing Identification of Clear focus on Identification of the Identification of
between strengths and interactions role of relevant organizations
organizations and weaknesses of the between institutions and which play a role in
institutions region in relation to organizations power relations setting the agenda;
presence and between different role of institutions
efficiency of organizations in the development
organizations and and acceptance of a
institutions common agenda
Multi-scalar Identification of Identification of Identification of the Accounting for the
approach key organizations regional and extra- scale at which role played by
and institutions at regional networks influential and organizations and
different scales relevant institutions institutions at other
(and their are introduced and levels in agenda
interrelatedness) enacted setting
affecting the
phenomenon under
study
Dynamic Understanding Grasping the Understanding Enhancing
perspective changes of evolution/co- changes of power knowledge about
presence and evolution of relations over time the development of
efficiency of interactions over a common agenda
institutions and time over time
organizations over
time
Thick versus thin Assessing strengths Assessing levels of Assessing power of Assessing degrees
and weaknesses of interaction in dominance in of commonness in
organizations and relative terms relative terms relative terms
institutions
(presence and
efficiency) in
relative terms
Source: Own elaboration

29
4 Conclusions

Over the past 20 years, the notion of institutional thickness has been widely invoked by scholars

working in the field of economic geography, innovation studies, and related disciplines. The

concept directs attention to a set of place-specific factors (that is, institutional presence;

interaction patterns; structure of domination and/or patterns of coalition-building; and a mutual

awareness of being involved in a common enterprise) and highlights how specific combinations

of these factors shape regional economic development.

Although the literature on institutional thickness has to be acknowledged for sharpening our

view of how institutions and organizations promote or hinder regional development, there are

also limitations and criticisms that have to be leveled against it. Based on a literature review of

conceptual and empirical work, as well as a systematic account of major shortcomings and

unresolved problems, several elements of a strategy that could advance the debate on

institutional thickness have been identified.

First, we argued for an analytical differentiation between institutional and organizational

thickness. Such a distinction lays the foundation for a more fine-grained analysis of the strengths

and weaknesses of the context under consideration and provokes some fundamental questions

about the complex relationship between the organizational and institutional dimensions of

thickness. Second, it was claimed that much could be gained by developing a dynamic

perspective, providing insights into how organizational and institutional thickness evolve over

time and adapt to changing context conditions and circumstances. Third, we emphasized the

need for a multi-scalar approach that puts due emphasis on how regional development

30
trajectories are shaped by the interplay of organizations and institutions at various geographical

levels, from the local/regional, to the national, to the global. Fourth, we advanced the idea that

the degree of organizational and institutional thickness should not be assessed in absolute but in

relative terms, calling for more longitudinal and comparative studies in the future.

Arguably, it was far beyond the scope of this paper to offer a comprehensive re-

conceptualization of the notion of institutional thickness or to map out a detailed research

agenda. Instead, we have highlighted some promising directions that future research may take

and we have discussed some conceptual and methodological challenges that are associated with

such an endeavor. The strategies and ideas sketched in this paper may not only contribute to a

redefinition of the original concept and its four constitutive elements. They could also enrich

economic geography more broadly by informing attempts that are currently underway to revive

and strengthen institutional perspectives within the discipline (see, for instance, Gertler 2010;

Rodrguez-Pose 2013). Furthermore, they could essentially inform the recent debate on forms

and mechanisms of regional industrial change, which has thus far underappreciated the role of

territorial institutions in shaping such processes. Building on an advanced understanding of

institutional (and organizational) thickness could help foreground this role, providing additional

levels of explanation of regional industrial change than that offered by evolutionary economic

geography.

31
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