Regional innovation policies and directionality: exploring the role of conditionality

The paper investigates the use of conditionality to achieve directionality within transformative innovation policies. To date, research in this area has been very limited in spite of the increasing adoption of the instrument of conditionality to advance societal goals, such as in the context of the new US industrial policy. The paper contributes to filling this gap by taking the specific perspective of regional policies which offer for different reasons a vantage point to analyse the mechanism. We first conceptualize the main benefits and limitations arising from the use of conditionalities with a directional purpose. We then analyse the concrete application of this specific form of conditionality in four case studies from EU and domestic regional policy comprising both policy conditionalities (S3) and grant conditionalities (regional or national funding schemes). The case studies suggest that the instrument of conditionality requires a high degree of flexibility to be effective in transformative innovation policies.