ABSTRACT
With its smart specialisation approach, the European Union encourages regions to identify existing areas of economic strength as well as new, but related, areas that the existing regional set of capabilities allows ‘branching’ into. This is known as related diversification or related variety, and is considered a key driver of regional economic growth (Boschma and Frenken, 2011). The counterpart concept of unrelated diversification or unrelated variety has so far received less attention in the literature (Boschma, 2017). Spreading economic activity over a variety of unrelated areas may, however, be especially beneficial for less favoured regions, for example, since it provides a buffer against shocks affecting one economic activity and those directly related to it.
