The Danish innovation system and international embeddedness: A case study of the cleantech project Zira Island

Louise Juul Fredbo-Nielsen

Student thesis: Master thesis


Based on the conceptual framework of the innovation system approach, this thesis explores the embeddedness of the cleantech construction project, the Zira Island, in the surrounding national-, regional-, and sectoral innovation systems. The Zira Island was originally a rocky, deserted island off the Azerbaijani coast but due to the two Danish companies, Rambøll and BIG Architects, it may well become a 1,000,000 square meter role model for sustainable urban development. Cleantech innovation thus represents a way of innovating for a sustainable growth model. Companies are embedded in complex webs of interactions and the Zira project is developed between in interactions through informal relations with reciprocity and feedback mechanisms in loops. The interactions and relations are mainly based on non-market collaboration characterised by a high degree of trust and through which the knowledge elements are transferred. The case findings show that BIG and Rambøll are influenced by the surrounding innovation systems in a variety of ways. As regards regional and sectoral innovation systems neither Rambøll nor BIG are officially members of such systems as e.g. Copenhagen Cleantech Cluster. However, the companies are arguably influenced by the more indirect effects of being situated in proximity to a large range of cleantech companies and research institutes geographically within the region. Concerning the influence of the European innovation system, the case findings do not indicate any significant and distinctive influence. The answer to the research question is to a large degree, that the Zira project can be explained by embeddedness in the Danish national innovation system. However, even though a large degree of exports and international interaction are characteristics of the Danish innovation system, they also indicate that the international embeddedness of the Zira project paradoxically can be partly explained by the project’s embeddedness in the Danish national innovation system. This can somewhat be accounted for by the small open economy argument that the openness of a small economy can be explained by the small size of the domestic market and that they depend on foreign markets to grow and be competitive. The case findings indicate that international embeddedness does not discard the importance of national innovation systems – and they will remain important with the increasing globalisation and changing context. Three possibly system failures in the Danish innovation system have appeared in this thesis: inefficient and sporadic network activities; bureaucracy and ignorance about the offers in the Danish innovation support system; and lack of access to financing. These system failures all call for policy intervention in order to mitigate the problems. But the most crucial challenges for Danish innovation policy in the future will be to establish a new policy construct which encompasses the blurring of interactions and relations across sectors, technologies, company type and size, geographical borders and public-private status.

EducationsMSc in International Business and Politics, (Graduate Programme) Final Thesis
Publication date2010
Number of pages101