Can public policy regenerate a traditional industry through collaborative research? The case of the Swedish food industry

This paper studies the regeneration of a traditional industry through the intersection of business innovation, public policy and the development of capabilities in firms. Our theoretical contribution is to propose that and conceptualize how public policy can indirectly boost the competitive advantage of a traditional industry by stimulating the development of firm capabilities to innovate through supporting collaborative research between universities and industry. To illustrate this proposition, we present an exploratory case study of a specific public policy initiative for collaborative research and structural change in the food industry in Sweden, from the mid-1990s to mid-2000s. The findings from this case study suggest that such public policy initiatives over time can and do develop firm capabilities to innovate in a traditional industry such as the food industry