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Upgrading is the acquisition of technological capabilities and market linkages that allows firms to enhance their supply chain competitiveness and move to higher-value activities. This upgrading occurs in many different forms representing opportunities for decision-makers in Asia.

Global value chains (GVC) are drivers of development, able to bring many socioeconomic benefits to the regions they touch down in. Both horizontal engagement—increasing a region’s capacity to engage with GVCs—and vertical engagement—actively seeking foreign direct investment (FDI) for upgrading—represent useful avenues for localities to climb global value chains.

Multinational enterprises (MNEs) locate their R&D activities around the world and their performance as innovators depends on this internal geography. But we also expect to see a link between their invention capabilities and how much innovation they actually do. In this paper, we explore whether and in what ways this relationship is influenced by the strength of intellectual property rights (IPR) protection, using a sample of highly innovative multinationals. We show that MNE innovative performance is enhanced when the firm’s R&D activities are based in locations where IPR protection is stronger. Moreover, the difference between the strength of IPR regulation in the home and host economies affects innovation performance, which we find deteriorates as the distance between home and host IPR regimes increases. Notably, MNEs from emerging countries exhibit a competitive edge when operating in highly protective systems thanks to their experience in more challenging environments in knowledge protection and involuntary leakages.

Many analysts argue that working from home (WFH) is now a permanent feature of our economies and the workplace as we knew it before COVID is dead. Some even predict the decline of the city centre, the end of crowded commuter trains, and the loss of innovation clusters. However, using novel and previously unexplored population data, Riccardo Crescenzi, Mara Giua, and Davide Rigo found that the diffusion of WFH was possibly exaggerated due to many studies’ strong assumptions of technology adoption and focus on big cities, which overlooks the practical barriers to WFH adoption for the less dynamic segments of the economy. They write that smaller companies and “poor” regions remain the big losers of the digital revolution.

Since 2021 Italy has experienced a significant growth in inward foreign investment, outpacing other EU economies. Annual inflows of new greenfield foreign direct investment (the construction of brand-new subsidiaries as opposed to acquisitions of existing companies) have grown by 33%. Inward cross-border mergers and acquisitions (M&As) increased by 14%, and inflows of venture capital and private equity by 250% and 50%, respectively. Riccardo Crescenzi and Sebastiano Comotti write that, along with the structural reforms underway, the National Recovery and Resilience Plan (NRRP) has played a key role in the recovery. They recommend a cautious approach to any future re-negotiation of the plan by the Meloni government.

How do new centres of technological excellence emerge? Research and Development (R&D) activities of foreign multinationals can act as powerful boosters of local innovation and growth in the cities where they invest. However, for the most innovative multinational companies, the risk of leaking knowledge to local competitors often outweighs the benefits of learning from those same competitors, thus reducing the incentives of ‘very innovative multinationals’ to embed themselves fully into the local innovation system. Riccardo Crescenzi, Arnaud Dyèvre, and Frank Neffke write that second-tier multinationals—those outside the top 20% of innovating firms—that start R&D activities in foreign regions generate more knowledge spillovers than higher ranking multinationals and consequently, foster greater growth in local innovation.

Products associated with specific locations in Europe, such as Roquefort and Parma ham, are protected under the EU’s ‘Geographical Indications’ scheme. This ensures these products can only be legally sold if they are produced in specified areas. As Riccardo Crescenzi, Fabrizio De Filippis, Mara Giua and Cristina Vaquero-Piñeiro write, Geographical Indications play a vital role for local development in rural areas with limited public expenditure. They provide protection against reproduction elsewhere, facilitate an upward effect on pricing and quality reputation, and improve demographic trends and sectoral re-composition.

Firms with direct investment in other countries create jobs at home. This is a counterintuitive fact that defies political thinking, especially in these rapidly changing times of populism and cries against global economic integration. Riccardo Crescenzi, Roberto Ganau, and Michael Storper study the number of jobs new foreign direct investment by domestic companies creates abroad, in comparison with local employment levels. They find a positive effect on domestic local employment, with a potential downside: intra-regional inequalities.

Firms with direct investment in other countries create jobs at home. This is a counterintuitive fact that defies political thinking, especially in these rapidly changing times of populism and cries against global economic integration. Riccardo Crescenzi, Roberto Ganau, and Michael Storper study the number of jobs new foreign direct investment by domestic companies creates abroad, in comparison with local employment levels. They find a positive effect on domestic local employment, with a potential downside: intra-regional inequalities.

A complex flow of investment is spreading across the globe, connecting more and more places. These flows bundle together streams of capital, skills and knowledge, the key factors in determining the development and wealth of places. As a result, it is now impossible to understand economic opportunities, innovation and development without one central concept: CONNECTIVITY.

Industrial policy is unfit for the new era. Riccardo Crescenzi (LSE), Jintao Zhu (LSE) and the LSE Maryam Forum Innovation and Inclusive Growth Working Group call for a new generation of evidence-based public policies to promote innovation and inclusive growth. Geo-political fragmentation, the reorganisation of global value chains and new technologies were all happening before COVID-19, ... Continued

Anti-systemic political movements have emerged in recent years in a large number of countries across the globe. These parties generally fuel their public support with anti-elite and anti-establishment rhetoric, which in Europe often translates into a strong critique to the European Union and its institutions. The EU is regarded by the supporters of anti-system movements as distant from the real, day-to-day, economic challenges and as a binding constraint to the capacity of national governments to deliver a more equitable distribution of prosperity. The inability of mainstream politics – of which the EU is seen as a natural expression – to deliver timely and credible answers to the economic needs of large strata of the electorate has been linked to electoral behaviour by a growing body of research (e.g. Rodrik, 2018; Guiso et al., 2018). However, it remains unclear how the EU can practically make a difference to the economic prospects of millions of EU citizens and, through its visible impact, influence their electoral preferences.

Post Brexit, the ensuing lack of EU agricultural subsidies will have a detrimental effect on the less developed regions of the UK, potentially more so than the end to EU regional development funds that have been benefiting already fairly well-functioning constituencies. In this piece Riccardo Crescenzi and Mara Giua explain the (un)intended consequences of Brexit in this regard.

The financial crisis affected European countries in radically different ways, with some countries emerging relatively unscathed, while others suffered extreme economic problems that still persist today. But as Riccardo Crescenzi, Davide Luca and Simona Milio outline, the effects were also substantially different between individual cities and regions. Based on recent research, they demonstrate which regions were best placed to weather the crisis and suggest that the presence of a skilled labour force was one of the key factors allowing certain areas to recover more quickly than others.

One of the potential problems created by the free movement of people is that skilled workers are drawn toward more developed areas, undermining the development of their own regions. As Riccardo Crescenzi, Nancy Holman and Enrico Orrù write, this process, commonly referred to as ‘brain drain’, can present a number of challenges for less developed European regions. However, drawing on research in Sardinia, they suggest that fostering an alternative process of ‘brain circulation’, in which the international networks and contacts of individuals living within an area can be utilised as a resource for development, can make mobility a positive driver of change.

Transport infrastructure investment is a cornerstone of growth-promoting strategies in the European Union. Yet, investment in new infrastructure is not always conducive to stronger economic performance. Drawing on a recent study, Riccardo Crescenzi, Marco Di Cataldo and Andrés Rodríguez-Pose write that in contexts marked by weak and inefficient governments and widespread corruption, different types of road investments often yield low or no economic returns.

The paper sets out to analyze the allocations of financial resources accruing to the European regions from the Regional, Rural Development and Agricultural policies of the European Union in order to assess their territorial coordination and synergies and their degree of compatibility with the "general" objective of territorial cohesion. Regression analysis is used to evaluate the relationship between allocated funds (dependent variable) and factors of territorial disadvantage (explanatory variables) covering the 20-year period 1994-2013 and approximately 90% of total Community expenditure. The analysis reveals that both coordination and compatibility with territorial cohesion of the various areas of Community policy have not always improved in response to major policy reforms. The territorial ‘vocation’ of overall Community spending is weakly linked to its distribution among different policies, but it crucially depends upon how each policy area defines appropriate allocation mechanisms and interventions, based upon the characteristics of each region and its ‘local’ needs.

This paper investigates the geography of multinational corporations’ investments in the EU regions. The ‘traditional’ sources of location advantages (i.e. agglomeration economies, market access and labour market conditions) are considered together with innovation and socio-institutional drivers of investments, captured by means of regional “social filter” conditions. The introduction of a wider set of attraction factors makes is possible to empirically assess the different role played by such advantages in the location decision of investments at different stages of the value chain and disentangle the differential role of national vs. local and regional factors. The empirical analysis covers the EU-25 regions and suggests that regional-socio economic conditions are crucially important for an understanding of the location investment decisions in the most sophisticated knowledgeintensive stages of the value chain.