10 A. Klitkou et al.
associated with the firms already present in the location. A progressive valorisation of waste is more likely when the current capabilities of a location allow
it, and such capabilities, or “competency mix”, are associated not only with
the firm producing waste, but also with the other firms present in the same
location. Knowledge from different economic sectors, all present in a location, could be recombined to generate the desired innovation. However, in
order to assess whether a location can provide the right “embedding” for
waste valorisation, it is important to understand at which geographical range
the location should be considered. A new technology may relate to some
competences built at country level, to some competences built at regional
level, and to some competences built at firm level. For instance, exploiting
knowledge from a technologically contiguous production process, currently
present in the country but not in the region, may not be possible when the
knowledge transmission requires a frequent interaction: in this case, a
country- level analysis of the competence mix would fail in identifying the
possibilities of a region. On the other hand, knowledge transmission requiring
a less frequent interaction would be neglected by a region- level analysis of the
competency mix which excludes knowledge spillovers from region to region.
The competency mix which waste valorisation can draw upon can thus be
assessed only by considering the recent economic history of the firm, of the
region and of the country where waste valorisation is expected to occur.
To sum up, innovation can alter the ways in which value circles operate
and intersect. The geographic scale on which the intersection takes place
always plays an essential role in the innovation process. As a consequence, the
geographic dimension constitutes an essential element to consider when planning new circular economies which valorise waste streams.
1.2.3 Resource ownership and interfirm governance structures
Innovative paths to the bioeconomy are dominated by uncertainty, stemming
not only from the unpredictability of scientific and technological evolution,
but also from the difficulty of value circles to maintain stability in the face of
fluctuations in natural resource availability on the market. An innovative bioeconomic sector may struggle to grow and survive, especially when it needs a
constant volume and quality of intermediate goods flowing from upstream
producers, to justify a long- term investment. At the same time, ensuring that
downstream buyers can guarantee a constant demand can be difficult when
the reaction of final consumers to the new bioeconomic products is not
predictable, or when the barrier to the entry of other firms into the innovative sector is low. A better coordination along the value circle can be
achieved, for instance, by extending the firm boundaries through vertical
integration, or by maintaining the existing firm boundaries while securing
stability through long- term contracts. An alternative solution to value circle
miscoordination may lie in sharing decisional power between firms that are
directly connected within the value circle. Formally, an individual could have
associated with the firms already present in the location. A progressive valorisation of waste is more likely when the current capabilities of a location allow
it, and such capabilities, or “competency mix”, are associated not only with
the firm producing waste, but also with the other firms present in the same
location. Knowledge from different economic sectors, all present in a location, could be recombined to generate the desired innovation. However, in
order to assess whether a location can provide the right “embedding” for
waste valorisation, it is important to understand at which geographical range
the location should be considered. A new technology may relate to some
competences built at country level, to some competences built at regional
level, and to some competences built at firm level. For instance, exploiting
knowledge from a technologically contiguous production process, currently
present in the country but not in the region, may not be possible when the
knowledge transmission requires a frequent interaction: in this case, a
country- level analysis of the competence mix would fail in identifying the
possibilities of a region. On the other hand, knowledge transmission requiring
a less frequent interaction would be neglected by a region- level analysis of the
competency mix which excludes knowledge spillovers from region to region.
The competency mix which waste valorisation can draw upon can thus be
assessed only by considering the recent economic history of the firm, of the
region and of the country where waste valorisation is expected to occur.
To sum up, innovation can alter the ways in which value circles operate
and intersect. The geographic scale on which the intersection takes place
always plays an essential role in the innovation process. As a consequence, the
geographic dimension constitutes an essential element to consider when planning new circular economies which valorise waste streams.
1.2.3 Resource ownership and interfirm governance structures
Innovative paths to the bioeconomy are dominated by uncertainty, stemming
not only from the unpredictability of scientific and technological evolution,
but also from the difficulty of value circles to maintain stability in the face of
fluctuations in natural resource availability on the market. An innovative bioeconomic sector may struggle to grow and survive, especially when it needs a
constant volume and quality of intermediate goods flowing from upstream
producers, to justify a long- term investment. At the same time, ensuring that
downstream buyers can guarantee a constant demand can be difficult when
the reaction of final consumers to the new bioeconomic products is not
predictable, or when the barrier to the entry of other firms into the innovative sector is low. A better coordination along the value circle can be
achieved, for instance, by extending the firm boundaries through vertical
integration, or by maintaining the existing firm boundaries while securing
stability through long- term contracts. An alternative solution to value circle
miscoordination may lie in sharing decisional power between firms that are
directly connected within the value circle. Formally, an individual could have