Rypestøl, JO., Martin, R., & Kyllingstad N. (2022). New regional industrial path development and innovation networks in times of economic crisis

This paper presents novel research on how exogenous shocks and economic crises affect innovation, knowledge networks, and new path development in regions. Conceptually, we take a regional innovation systems perspective which views new path development as the outcome of innovation and knowledge exchange between firms and other actors, facilitated by a common institutional framework. Empirically, we draw on interviews and network data from the oil and gas industry in southern Norway. Following a long period of prosperity, the industry was hit by the oil price shock in 2014 and entered an economic crisis. The findings suggest that the shock triggered the firms to commit even more forcefully to innovation and to expand their knowledge networks geographically. To cope with the crisis, they applied a variety of strategies, which can be associated with different forms of path development. We draw conclusions for innovation policy in the context of exogenous shocks and crises.