This paper discusses two influential policy concepts at the European level that aim to promote economic diversification of regions, that is the Constructing Regional Advantage concept (CRA) and the Smart Specialisation concept (SS). Both policy frameworks identify and prioritise ‘promising’ targets for policy intervention, but they do so differently. The SS concept organizes this identification process through entrepreneurial discovery in which entrepreneurs select the domains of future specialisation. The CRA concept focuses on identifying related variety and bottlenecks that prevent related industries in regions to connect and interact. The paper argues that the two policy concepts can provide useful inputs to develop a smart and comprehensive policy design that focuses on true economic renewal in regions.
Keywords: Smart specialisation, constructing regional advantage, regional cohesion policy.
Jel Code: O25, O38, R11.