At Orkestra we have been working in the field of urban competitiveness since 2013, mainly within the framework of the Bilbao Next Lab (BNL) project. BNL is the Action Research Lab of the Bilbao Smart Specialisation Urban Strategy (called Bilbao Next strategy). Several posts on urban innovation districts or the role of vocational training in the development of talent in advanced services show our track record in this line of research.

We approach the field of urban competitiveness from a territorial perspective. We conceive the territory (in our case, the Basque Country) as a multi-scale reality that includes cities. Thus, our aim is to study cities as spaces of territorial competitiveness in this multi-scale context. The growing weight and influence and the singular contribution of the urban spaces in territorial development require more focused and specialised research. In this sense, we believe that Basque cities have a specific role to play in supporting regional competitiveness (and beyond). We base our conclusion on two main pillars.

The first refers to the increasing importance of the service sector and the tertiarisation of the economy. As we underlined in the 2019 Competitiveness Report, in 2030 more than three quarters of employment in the Basque Country will correspond to the service sector. The fall in Basque manufacturing employment finds its counterpart in the rise of business and advanced services. This is a type of activity which, according to forecasts, will acquire greater weight in the Basque Country (surpassing Spain and the EU28) and will have to respond to a growing demand from the manufacturing sector.

Advanced services tend to be concentrated in urban environments as they are particularly sensitive to agglomeration economies (Keeble and Nachum, 2002; Wood, 2002, 2009). The concentration of talent, entities and agents has consolidated cities as knowledge spaces and, as such, they are favourable environments for the exchange and transmission of information that makes innovation possible. This is why cities, including the three Basque capitals, and their corresponding (and potential) sectoral specialisation in these advanced services deserve our attention in the framework of the aforementioned fourth industrial revolution (Lafuente et al., 2017; Wyrwich 2018; De Propis and Bailey, 2018).

The second pillar relates to the role of cities in the sustainable transition. These spaces are increasingly vulnerable to major global transitions (climate, digitalisation, demography) (Elmqvist et al., 2019). The issues arising from these changes are clearly visible in cities, but at the same time these spaces are essential to address them. Urban environments facilitate contextualised 'place-based' policies that address the challenges arising from major transitions through local responses and co-creation among the diverse actors they bring together (Vonwirth et al., 2018; Elmqvist et al. 2019; Hajer and Versteeg, 2019; Kabisch et al., 2019).

Currently, these two pillars, although not the only ones, are fundamental when addressing and conceptualising the role of urban competitiveness policies in the Basque Country. They allow us to see that cities offer the opportunity to experiment with new approaches to innovation policy such as those proposed by the Smart Specialisation Strategies for Sustainability (formerly S3, now S4-Smart Specialisation Strategies for Sustainability).

The new approach to smart specialisation invites European regions to rethink their S3 in order to put innovation policy at the service of sustainability and inclusive growth and thus address an unprecedented job creation policy for the post-Covid era. In this sense, it is proposed to strengthen bottom-up experimentation, with greater involvement of citizens, fostering synergies between innovation-sustainability-infrastructures-skills, and a greater effort in multi-level coordination. Urban conditions are unique for this and allow us to reinforce the argument that cities should play a prominent role in regional competitiveness and innovation policies. This is why, at Orkestra, we have made progress and intend to continue working in the field of urban competitiveness.

From this post onwards, we will invite different researchers to unravel the complexity of urban competitiveness by focusing on specific challenges and their respective responses that, in turn, show the potential contribution of the city to the territory. Let's keep going!


miren estensoro

Miren Estensoro

Miren Estensoro is a Researcher at Orkestra-Basque Institute of Competitiveness and a lecturer at Deusto Business School. She holds a PhD in Economics from the University of the Basque Country. Her research area is mainly local economic development, territorial governance and multi-level coordination of competitiveness policies.

See full profile


Mikel Albizu

Mikel Albizu

Mikel Albizu is a pre-doctoral researcher at Orkestra. At present he combines his doctoral studies with the participation in several research projects.

His main research area is employment and the factors that drive it at a regional and local level, although he has also studied and worked in the field of urban planning and territorial planning.

See full profile

IN COLLABORATION WITH