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Saarivirta, Toni
Year of Publication: 
Series/Report no.: 
Manchester Business School working paper 568
This paper adopts the point of view that a crisis will face a person, organisation, region or country at some point in their life span or history. The question is how to prepare for the crises and recover from them afterwards? Some of us recover better than others and in a shorter time. The concept of self-renewal capacity will be introduced here as a tool to prepare for the future. Three economic theories: neoclassical and endogenous growth theories, and evolutionary economics based theory are used here as reference points in search of self-renewal capacity. The results show that endogenous growth theory gives more room for self-renewal capacity than does neoclassical growth theory, but, nonetheless, several questions, such as the dynamic of economies, remain unsolved. Evolutionary theory, however, fits most eminently when defining the concept. Self-renewal capacity starts clearly from an individual level learning processes and grows in time, to consider firms, organisations, institutes and regions. Exploitation, exploration, absorption, integration and leadership, together with social capital, are at the core of self-renewal capacity. Together with localised technological knowledge and collective knowledge, self-renewal capacity can combine bottom-up and top-down approaches.
self-renewal capacity
growth theories
evolutionary economics
regional development
localised technological knowledge
collective knowledge
Document Type: 
Working Paper

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