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Abstract

The pilot scheme ‚Land(auf)Schwung‘, funded by the German Federal Ministry of Food and Agricul- ture, was designed to test new approaches in the development of rural areas. 13 peripheral rural counties received between 2.25 and 2.9 million euros each in total funding between the years 2015 ii Kurzfassung und Abstract and 2019, to develop new approaches in the provision of basic services and to foster regional growth and net value creation. Deprived rural areas often face a rather low innovation potential due to a lack of knowledge infra- structure, a composition of the local economy characterized by low-tech branches, few start-ups and an overall dominance of small businesses. The regional economy in rural areas does not offer many jobs for a high-skilled workforce and low levels of productivity prevent competitive salaries for skilled labour. Against this background, the thirteen regions of this pilot scheme experimented with new ap- proaches to strengthen the regional economy. For example, small businesses from the food sector received investment funding to develop new and innovative products, to develop regional market- ing initiatives and networks and to increase the sale of regional products. Likewise, in some regions centres for technology and entrepreneurship were installed. Based on the vast landscape of funded projects in the 13 regions, this research project draws conclusions and recommendations for the development of rural areas. For example, case-studies were conducted analysing the biographical development of innovative products in small food businesses. The development of two technology centres was likewise analysed. In total, 83 interviews were conducted with various stakeholders and agents in rural development, and a survey conducted with 166 members in regional marketing initiatives (micro businesses). The research depicts the vivid innovation activities of the micro and small businesses under focus. By funding specialized machinery, which is adapted to match the needs of small and micro businesses with a niche strategy, the growth of these businesses can be supported. Regional marketing initiatives initiate local cooperation and knowledge sharing be- tween their members and can this way boost innovation in small businesses, which eventually leads to business growth. However, because local marketing initiatives come with comparable overhead for a shared logistic, the regional conditions for an efficient running of a shared logistics unit should be evaluated first. While technology centres can lower the entrance barriers to self-employment, they should always be integrated into a comprehensive regional strategy of economic develop- ment, to unlock their full potential.

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