Understanding novelty production

By: Jan Douwe van der Ploeg, Henk Oostindie, Rudolf van Broekhuizen

1. Domain description

Van der Ploeg and Wiskerke (2004) define novelties as follows: ‘Novelties are located on the
borderline that separates the known from the unknown. A novelty is something new: a new
practice, a new insight, an unexpected but interesting result. It is a promising result, practice
or insight. At the same time, novelties are, as yet, not fully understood. They are deviations
from the rule. They do not correspond with knowledge accumulated so far – they defy, as it
were, conventional understanding. Novelties go beyond existing and explained regularities’

Novelty production is about new insights, practices, artefacts, and/or combinations (of
resources, of technological procedures, of different bodies of knowledge) that carry the
promise that specific constellations (a process of production, a network, the integration of two
different activities, etc) might function better. Novelties are, as yet, not elaborated in terms of
codified (or scientific) knowledge. Novelties can not easily be transported from the specific
context in which they emerged and germinated, to others contexts. Hence, a novelty is quite
different from an innovation. An innovation is an expression of codified knowledge and
embodied into an artefact that could travel globally. A novelty, instead, associates with (is
part of) tacit knowledge (see also below) and is highly bound to (and rooted in) the local.

The metaphor of seed could be used to emphasize three essential elements of a novelty. First,
novelties need time - just as seeds require cultivation and nourishment to germinate, grow,
flower and set fruit. They follow a specific unfolding through time before the final outcome
(their 'usefulness') can be assessed. Equally novelties require time to show whether or not the
entailed (or assumed) promises really do materialise. Secondly, seeds require a particular
ordering of space, or more generally: a particular organisation of context. Sowing seeds on
rock bed or in a desert is useless. One needs a well prepared seed bed, a well organised
distribution of water, proper crop protection, and so on. Translated to the level of novelties,
this implies that one change in existing routines often implies a second one and then a third
and fourth, etc. The first improvement spurs the second one, because it both requires and
informs it. That is, a novelty seldom remains isolated; a novelty will result in a wider
programme of interrelated, and mutually reinforcing novelties. Thirdly, the inherent
insecurity needs to be stressed. Just as harvests may fail, novelties might turn out to be
failures as well. Novelties are related to expectations. It is, however, far from evident whether
the eventual outcomes will match the initial expectations.

Thus a novelty is, to echo Rip and Kemp (1998), "a new configuration that promises to work".
Continuing the same analogy, we could equate the notion of novelty to a mutation through
which a single new variety of seed arises, through mutation in just one seed. That single seed
falls on the ground, germinates, the plant grows, flowers, sets seed and shows characteristics
that other non-mutated seeds do not have. That is a first, one-off, different outcome. If this
first outcome is 'recognised' by the environment as being advantageous, more seed with this
new characteristic might be produced. This would then be a second-level or 'general
acceptance level' outcome: a general recognition in the context that this represents a beneficial

1
change. Conversely, the 'first' outcome might go unnoticed (which is the most common
scenario). Then the novelty remains a 'hidden one' - it might even be nipped in the bud.

Novelty production, learning, contextual knowledge and the territory

Novelty production is highly associated with ‘contextual knowledge’. The more the latter is
available, the more novelty production there will be. On the other hand, high levels of
formalization and centralization (and a subsequent marginalization of tacit knowledge) will
slow down processes of novelty production. It could be argued that ‘contextual knowledge’ is
a crucial and indispensable ingredient of what we refer to, in the ETUDE program, as the
‘web’. Following Nonaka and Takeuchi (1995), Belussi and Pilotti (n.d) distinguish four
important processes of learning that flow together into the creation of ‘contextual knowledge’.

These processes are:

a. socialization, where there is a passage among individuals of tacit knowledge, through a
process of collective sharing of knowledge;
b. externalisation, in which tacit knowledge is transformed into codified knowledge, a
necessary passage in order to diffuse knowledge in a global circuit outside the group that
possesses them;
c. recombination, that implies the reuse of various types and sources of tacit knowledge and
codified knowledge for the creation of new knowledge, through the use of firm networks and
of other inter-linkages;
d. internalisation, that describes the process through which firms absorb external knowledge
transforming it into pieces of tacit knowledge.

Together these learning processes flow into the “stock of contextual knowledge”. “Contextual
knowledge may be described as the social output of a historical process of accumulation of
technological capabilities and skills. This occurs only if in a specific territory the mechanism
of mobilization of knowledge is activated”(p. 14).
Contextual knowledge is an important source of novelty production 1. Novelties embody the
new (and often unexpected) combinations of heterogeneous knowledge elements contained in
the stock of contextual knowledge. Experiences obtained with the practical use of novelties
will, on their turn, enlarge the territorial stock of contextual knowledge.

Figure 12 summarizes some of the crucial differences between the learning processes
underlying novelties and innovations. It shows that novelties are primarily ‘grass-root’ driven,
grounded in internal worlds of production and learning process characterized by keywords as
contextualization, territorialisation and socialization. On the other hand, innovations are
primarily building on external worlds of production, experts driven and learning process
characterized by standardisation, externalisation and globalisation. It is also through these
latter processes how novelties might be translated into innovations. At the same time it is
illustrated that the opposite might also happen: innovations might be translated at grass-root
level into novelties through contextualisation, territorialisation and internalisation.

1
Some novelties arise as ‘accident’ or by ‘error’. Even then, contextual knowledge is crucial for the recognition
of the potential value of the ‘error’. See e.g. Remmers (1998) for a beautiful example on how a local cheese
specialty in Andalusia should be traced back partly to an active recognition of unexpected opportunities from
‘accidents’ around farmers’ driven novelty production
2
This figure is strongly inspired by the comments of our Latvian colleagues on the first draft report on novelty
production

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 Figure 1:
Contextualisation
Internalization
Territorialisation

Innovation Novelty Internal world

External world of of production,
production, Expert ‘Grass-root
drivenominated Farmers
driven’
Standardisation
Externalisation
Globalisation
Exterritorialising
„Up-scaling”
In the literature reference is made to the following mechanisms that might favour the
emergence and further unfolding of novelties:

1. the presence of “knowledgeable” agents (these might be individuals, firms and

institutions), and the capability of combining dispersed pieces of knowledge in
channels that allow for repeated interactions;
2. a diffused social system of SME, characterized by low levels of internal organizational
costs, high levels of mutual trust and a high ‘birth-rate’ of new small firms (often
founded by employees of technologically advanced firms, who start their own new
enterprise;
3. specialisation at the level of the area as a whole (reflecting the Italian ‘districts’) in
combination with a well developed division of labour organized through inter-firm
relations of subcontracting;
4. awareness within the firms and institutions of novelties and the ability to absorb and
assimilate new knowledge;
5. an artisan nature of processes of production, the centrality of skills, and demanding
clients.
6. networks that allow for learning (ref. the processes of learning indicated here before);
sometimes such networks might be explicitly organized as e.g. field laboratories
(Stuiver et al, 2003);
7. internal differentiation (in the Dutch horticultural sector it are the small warehouses
that have the ‘room’ for experimentation – once a new product or procedure is ‘ready’
it passes to the large ones);
8. R&D institutions that collect and build upon local novelties. Vijverberg (1996) studies
a set of innovations in glasshouse production in the Netherlands and comes to the
conclusion that innovations with roots in ‘practice’ are clearly more successful in
terms of future degree of implementation than innovations that have their origins in the
agri-expert system.

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Novelty production & agricultural development trajectories

The history of agriculture is a history of novelty production. Over the centuries farmers have
introduced, on purpose or unintentionally, small changes in the process of production,
resulting in a steady but ongoing increase in yields. This process has been amply documented
(see e.g. Slicher van Bath, 1960; Boserup, 1965; de Wit and van Heemst, 1976; de Wit, 1983;
Richards, 1985; Bieleman, 1987; and Osti, 1991). Analytically speaking it might be argued
that novelty production is intrinsic to agriculture as co-production, i.e. to agriculture as the
ongoing encounter, interaction and mutual transformation of the social and the natural
(Toledo, 1992; Rip and Kemp, 1998; Roep, 2000; van der Ploeg, 2003). In such an analytical
framework novelty production might proceed along the following lines:

1) Improving resources
2) Fine tuning (of growth factors)
3) Boundary shifts
4) Re-patterning of resource use

Ad 1) Improving resources

Agriculture is constantly being differentiated and transformed (Altieri ,1990; Toledo, 1992;
Sevilla Guzman & Gonzalez, 1990). New constellations emerge, containing remoulded
resources and new combinations of resources. Hence, ‘nature’ as entailed in farming is “not
the one from Genesis” as Koningsveld (1987) beautifully phrased it. Instead, ‘living nature’ is
constructed, reconstructed and differentiated within long and complex historical processes,
through which particular characteristics are built into the resources concerned (be they horses,
cows, fields, crops or manure; Seabrook, 1977 and 1994; Groen et al, 1993; Sauvant, 1996;
Smeding, 2001; Sonneveld, 2004; Wiskerke, 1997). Thus, particular regularities emerge that
characterize the behaviour of the involved resources. These patterns of regularity are neither
fixed nor universal: they might be modified, at particular conjunctures in time, into other,
possibly even contrasting, regularities (NRLO, 1997; Ploeg, 2003; Groot et al, 2003).
In theoretical terms this implies that the behaviour of natural resources cannot be properly
understood outside the pattern of land use (or style of farming) within which they are
combined (according to a particular balance) and through which they are reproduced,
developed and particularized into distinct entities that fit optimally with the other entities that
form part and parcel of the same land use pattern (Ploeg, 2003; Sonneveld, 2004). Concrete
resources are the outcome of co-production: they are shaped and reshaped in and through the
constantly evolving interaction between man and nature. That is, co-production feeds back on
the resources on which it is built. Farming is not a uni-directional process. It is not simply
based on resources, but entails also feedback effects through which the involved resources are
unfolded in differentiated ways.

In the specific Dutch context ‘Good manure’ is probably one of the most telling but also one
of the most contested novelties to illustrate these different feed back mechanisms. The
background of this particular novelty is located in the former modernization process that
deeply restructured farming practices and the involved resources. "Well bred manure" once
was a highly valued resource. The making and use of it were closely embedded in local
cultural repertoire. Along the modernization trajectory, however, this well bred manure was
converted (unintentional) into a waste product – a “nuisance, you had to get rid off” (Eshuis
et al, 2001). But, as many farmers argue, “once you have a nuisance in your farm, it will re-

4
emerge time and again”. Loss of organic matter in the subsoil, increased need of high
fertilizer levels and worsening grassland conditions were but a few expressions of this ‘law of
the reproduction of misery’.

For some farmers this somewhat worrying state of arts triggered a multi-facetted search to
create again good or at least improved manure. Thus, good manure started as a critique on
inefficiency and losses. It equally and simultaneously departed from the careful observation
and interpretation of relevant heterogeneity: the fields of one particular farmer yielded far
more grassland production than the fields of others in the same neighbourhood; it was
assumed that this could possibly be related to the somewhat different, maybe improved
manure he used in his fields.

Figure 1: Cattle-manure-soil-fodder balance

That ‘Good manure’ is not an isolated artefact but the outcome of interrelated resource use
can best be discussed with reference to figure 1. Good manure is slurry having an elevated
C/N ration and a relatively low part of ammoniac nitrogen (and consequently an elevated part
of organic nitrogen). These and many other features are now (that is after nearly 15 years)
well known, documented and scientifically explained (see e.g. Verhoeven et al, 2003;
Sonneveld, 2004; Goede et al, 2003 and 2004; Reijs et al 2004 and 2005; Reijs, 2007). At the
beginning, though, of the research journey, the required specifications were mostly lacking;
alongside many, but mutually contrasting opinions of farmers (Eshuis et al, 2001) there only
was the expectation that manure could be made better. This applied also to the constellation as
a whole (as illustrated in figure 1). It was expected that a rebalancing of it (Verhoeven et al.,
2003) would render positive outcomes – especially since former modernization trajectories
had been focussed nearly exclusively on one component of the relevant whole (the cow) and
thus created many frictions and setbacks.

At the beginning good or improved manure clearly represented a novelty. It was different in
terms of composition, outlook, smell and effects. It differed also in as far as its history, i.e. its
making was concerned. At the same time, many exponents of the Dutch agricultural expert
system considered good manure to be a monstrosity. As something that, according to the
available insights, could not function and which neither ought to be functioning. The more so,

5
since involved farmers were having the opinion that good manure has to be applied in ‘a good
way’, that is by on-surface distribution instead of the legally prescribed injection into the
subsoil.

Ad 2) Fine tuning

Secondly, novelty production in agriculture is about the coordination and fine tuning of an
extensive range of growth factors, including e.g. the amount and composition of nutrients in
the soil, the transportability of these nutrients, the root capacity to absorb them, the
availability of water and its distribution over time and so forth. Even the relatively simple
cultivation of wheat involves more than two hundred such growth factors and more emerge
with the growth of knowledge. Again, what is important is that these growth factors are not
constant through time. For example, the amount and composition of nutrients in the soil are
modified through the work of farmers (see Hofstee 1985 for an impressive discussion of
farmers' management of soil fertility before chemical fertilisers were available).
'Transportability and distribution of nutrients' depend on ploughing, and the availability of
water is regulated through irrigation and drainage. In the end, yields depend on the most
limiting growth factor, as illustrated in figure 1 in which the growth factors are represented as
the staves of a barrel. The water level, i.e. the yield, depends on the shortest stave. Within
their praxis farmers are continuously looking for the 'shortest stave', that is for the limiting
factor. Through complex cycles of careful observation, interpretation, re-organisation (often
taking initially the form of experiments) and evaluation, novelties are found and/or created.
That is, existing routines are changed. This is an ongoing process: once the original limiting
factor has been corrected, another will emerge as the newly limiting one.

During the modernisation trajectory the driving forces of agricultural growth changed in a
radical and far reaching way. Whilst for centuries it where farmers that sought for and then
corrected the limiting growth factors (the 'short staves' of figure 2), in the era of
modernisation the agrarian sciences took over this role of upgrading of specific growth factors
(and subsequently adjusting others). In consequence a new division of labour emerged:
farming became increasingly embedded in, and dependent on, the socio-technical regimes and
the process of upgrading was considerably accelerated.

The accelerated upgrading of growth factors, and the associated intensification, specialisation,
spatial concentration and scale enlargement, runs increasingly counter to a range of social and
ecological limits and reactions. The more so since natural growth factors entailed in the local
eco-systems are being replaced by artificial growth factors: the 'art of farming' has become
increasingly disconnected from locally available resources and the eco-system, and from local
socio-economic patterns and relations (Altieri, 1990; van der Ploeg, 1992). As a result novelty
production by farmers (but not only farmers) is increasingly blocked since the production of
progress is now largely taken over by those institutions that form part and parcel of the
reigning regimes.

In contrast with the modernization logic, novelty production in agriculture is a highly

localised process: time and again it is dependent on local eco-systems and on local cultural
repertoires in which the organisation of the labour process is embedded. This implies that
what emerges in one place (and at a particular time) as an interesting novelty, will probably
not pop up in another place or if it does it might have adverse effects or hold little or no
promise. For the same reason it could be argued that rural areas entail probably more than

6
urban areas, a balance between tacit knowledge and codified knowledge. Learning processes
proceed here very much as and through socialization, internalization and recombination.

Figure 2: growth factors composing the agricultural process of production (von Liebig,
1855, De Wit, 1992a and b)

Ad 3) Boundary shifts

Thirdly, novelty production can’t be isolated from ongoing dynamics in terms of farm
boundary shifts. Rural development processes occur very much as ‘entering into the
unknown’. New experiences are to be translated into new knowledge which on its turn
inspires new practices. This applies to the creation of new activities and new networks that
add income and employment opportunities; to the construction of new responses that
correspond to changing needs and expectations of society at large; and to the reconfiguration
of rural resources. Ventura and Miloni (2004: 57) speak in this respect of novelty production
as a ‘redefinition of farm boundaries’ and emphasize that in the case of farming it is ‘likely to
be faced with complex innovation processes that ultimately might lead to a redefinition of the
very boundaries of the farm/firm’. Same authors further argue that farms that reorganise their
entrepreneurial activities towards multifunctionality (and thus actively redefine farm
boundaries) are characterized by complex innovations of product, process and organisation
and strong dependencies on the internalization of learning processes within the farm itself.
This in contrast with conventional innovation paths in agriculture, much more characterized
by the ‘expropriation of the cognitive element of innovation, leaving the farm only the work
of implementation’ (ibid, p.79).

Ad 4) Re-patterning of resource use

Fourthly, novelty production in agriculture can refer to an active re-patterning of resource use.
This can be illustrated by an initiative in the Dutch village Zwiggelte, located in the Northern
Province Drenthe. Here 7 farmers took the initiative to look for alternative farm development
opportunities. In retrospect it is clear that these farmers used the following implicit ‘design
principles’: a) to built as much as possible on local assets, b) through the introduction of some
new external elements that c) allow for completely new and productive combination of these
assets. Thus, once more or less useless assets are converted into productive resources, without
other resources being degraded or put in disuse. As such this might seem to be quite obvious.
However, when farmers’ innovativeness is compared with other processes of change, properly
this creation of resources will turn out to be a decisive.
Figure 3: Re-patterning of resource use by Zwiggelte farmers.

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The proposal developed by the seven farmers can be explained with reference to figure 3. It
highlights the following design principle: the art of farmers’ driven innovativeness centres on
the creation of new, as yet not existing connections. A first connection (at that time not yet
widely known) was the one between manure surplus and energy production. However, the
efficiency of a straightforward conversion of manure into energy is deceptively low. Here a
second connection turned out to be decisive. They came to know a, at that time new
technology – developed in Germany – that considerably increases the efficiency by fuelling
the process with carbon. After a study tour to Germany (this is the second connection) they
concluded that in their own situation this would be very well applicable, especially when a
third and fourth connection would be created: through the maintenance of the forest they
could ‘harvest’ a lot of the required carbon, whilst agricultural waste 3 could be used as well.
Conversion of manure4 enriched with carbon renders gas. This provoked the fifth connection:
the ancient pumping station could be re-used again to introduce the gas directly into the
delivery system. In order to convince the company (Gasunie) that controls the gas
distribution, a sixth connection was created and used: the Petten research institution (ECN)
was asked to make a chemical and physical analysis of the gas to be produced. It turned out to
have the same characteristics as natural gas; hence it could be introduced without any
inconvenience into the delivery system.

Being keen calculators, Zwiggelte farmers immediately realized that one of the implied risks
would be a nearly complete dependency on the Gasunie network that controlled all gas
distribution. Thus a seventh connection was studied: the possibility to convert the gas, with a
turbine, into electricity and to channel it into the regional distribution network(NUON) for
electric energy. By doing so they would create flexibility: energy could be channelled,
according to the terms of trade, to NUON or to Gasunie. However, the conception of a new
pattern that indeed promises to turn more or less useless assets into productive resources, did
3
Heads and leaves of sugar beets, rotten potatoes, etc.
4
Here there is another important feature. The composition of manure of single farms (be it dairy, chicken or
pigs) is highly variable which considerably lowers the efficiency of energy production. However, the
combination of manure flows from many farms allows for the construction of a stable input into the energy
production process.

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not stop here. Production of electricity out of gas produces as well a lot of heath. Normally
this is lost. Hence connection number eight was invented: channelling the heath towards the
bungalow park and its swimming pool for continuous heating (implying that the open air
swimming pool could be used for a far more extended period in the year and therefore making
the park more attractive). A ninth connection that was explored was direct delivery of
electricity (through a new cable) to the local small and medium enterprises. Connection
number ten regards the use of the realized VA within the local community5.

Although certainly not all relevant interconnections in the Zwiggelte case have been
mentioned, our main point will be clear. Novelty production proceeds here as the re-
patterning of resource use and as the capacity to make new connections. In this case we
focussed in particular on the material aspects of these new connections, but evidently each
and every step involves as much a negotiation, renegotiation, and possibly the creation of new
institutional relations (see also paragraph 2 and 3).

2. Relevance of the domain / interrelations with other domains

The relevance of novelty production, as defined in the foregoing, could be summarized as

follows:

1) Novelty production strengthens the transformation of (potentially) available resources

into territorial specific resources
2) Novelty production creates capacity to ‘do it better’ and in that way increases the
competitiveness of agriculture and rural economies
3) Novelty production (in combination with contextual knowledge) allows sustaining and
extent local control over resource valorisation.
4) Novelty production can support territorial distinctiveness
5) Novelty production can be a stimulus for the deepening of contextual knowledge
6) Novelty production can mobilize creativity that is underutilized or completely denied
within conventional RD systems

This could be further illustrated in relation to the other dimensions of our ETUDE analytical
framework.

Endogeneity

Novelty production is intrinsically interwoven with endogeneity as e.g. explicitly concluded

by Belussi and Pilotti, who state that contextual knowledge, as the locally constructed mix of
tacit and codified knowledge source for novelty production, is a “strategic but immaterial
resource, which is essentially territorial specific” and, therefore, an endogenous resource.
Empirical material as presented in the foregoing made clear that novelty production is often
also about escaping from control as imposed by the state, expert-systems, vested farmers’
unions, food chain partners, etc. This struggle for (relative) autonomy, illustrates in another
way its close relations with endogeneity.

Unfolding sustainability
5
Several years later, that is at the beginning of 2007, the first of the required legal permissions nearly had been
granted.

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Our Good manure case demonstrated that the translation of environmental progress into
economic gains (as implied by the new balance) has been primarily secured by the fact that
farmers themselves succeeded to create new sustainability relations building on a re-
particularization of farming and a re-grounding of innovation processes in diversity. This in
contrast with decades of strongly institutionalized productivist perspectives on Dutch
agriculture in which diversity and local specificity where above all considered as obstacles to
overcome. Currently, national socio-technical regimes are increasingly forced to adapt their
programs in order to address the issue of sustainability. Specific regimes have been
implemented to reduce the environmental pressure caused by agriculture. Many of these
regimes are coordinated at the level of the EU: which sets global targets, although the means
for achieving these vary slightly between countries and sometimes regions. One of the
common features of these regimes is that they frequently aim to meet sustainability criteria
through introducing additional regulations that aim to down-grade a few, specified growth
factors. New societal objectives such as e.g. more bird life in meadows, cleaner ground water,
fewer additives in food, or lower ammonia emissions, are translated into a reduction of
specific growth factors and specified in terms of the associated tasks. Hence, mowing should
be delayed, fertilisation should be reduced, manure should be applied through injection into
the soil, etc. However, through such partial down-grading the carefully constructed
coordination of the whole is disrupted and a range of discongruencies will emerge. Costs will
rise and yields will drop. Dominant technological regimes deal with this by financially
compensating for the associated drops in productivity and/or increased costs. Schemes for
landscape and nature conservation are clear expressions of this approach. While often
successful in the short term the dilemma that they give rise to is becoming very clear. The
more agriculture uses this approach to move towards sustainability, the higher the associated
financial burden will be (ADAS, 1996; Slangen, 1994).

In short, alternative roads to sustainability might emerge from novelty production, involving
an ongoing search, through practice, for adequate ways to handle environmental problems. In
contrast with innovations and prescriptions introduced by prevailing regimes, novelties are
grounded on farm labour processes, contextual knowledge and local particularities.

New institutional arrangements

New institutional arrangements are intrinsically related to novelty production. Novelties might
be a new institutional arrangement in it self, as e.g. territorial cooperatives in the Netherlands.
The emergence of these new forms of cooperatives reflect in the first place that interrelations
between the state and the farming sector in the Netherlands have become strongly
disarticulated due to state regulatory schemes that are increasingly felt as inadequate if not as
asphyxiating by farmers. Mutual distrust is almost becoming a ‘structural’ feature in the
Netherlands: Farmers deeply distrust the state, the state apparatuses deeply distrust farmers
(Ploeg, Ettema and Roex, 1994; see also Ploeg, 2003 and Breeman, 2006). This new
disarticulation has triggered a new form of rural cooperation that materializes in what is
increasingly referred to as territorial cooperatives. These cooperatives aim at a drastic
improvement of the relations between farmers and the state through the introduction of new
forms of local self regulation that combine with new strategies for ‘negotiated development’
around prevailing institutional barriers. Regulatory schemes imposed by state apparatuses are
highly segmented: one set of rules regards e.g. nature values and their protection, whilst
another set regards the reduction of ammonia emission, etc. On its turn this internally
segmented (and often contradictory) set of prescriptions is disconnected (due to its particular

10
design) from farming practices. As a consequence the introduced sets of rules materialize as
ever so many limitations imposed upon farming (WRR, 2003). Thus it is widely felt that the
construction of sustainable rural economies requires new forms of regional cooperation, and
that only through such new forms of cooperation the many frictions and limitations inherent
to the general rule sets defined by expert systems and the state, can be successfully redressed.
In paragraph 4 we will introduce the concept of strategic niche management to further
illustrate the often complex and multi-dimensional interrelations between novelty production
and institutional settings.

Governance of rural markets

If sufficiently protected and facilitated, novelties might contribute significantly to the

competitiveness of rural economies. Due to the presence and ongoing unfolding of novelties,
regional processes of resource combination, production, distribution, etc., might become more
efficient, result in higher quality levels of the produced products and services, and/or
contribute to new forms of synergy. In depth empirical studies conclude that it is in particular
an adequate coordination between different types of novelties that results in positive farm
income effects (Swagemakers, 2003). For the set of novelties around the production of ‘Good
Manure’ positive farm income effects have been demonstrated by longitudinal analysis of
available farm accountancy data with also at regional level clearly positive socio-economic
impacts through the reversal in the interrelations between economy and environment(Van der
Ploeg et al, 2003). It illustrates that novelty production might convert classically reigning zero
sum games (in this specific case the balance between environment and economy) into new re-
alignments that result in considerable synergies.

Social capital

With regard to the interrelations between novelty production and social capital it could be,
firstly, argued that different forms of social capital might be needed during different stages of
novelty life-cycle dynamics. For the emergence of novelties as ‘deviations from the rule’ in
particular the presence of bonding social capital (see also document on endogeneity) seems to
be important, as also implicitly demonstrated by our empirical evidence on novelty production
in the Netherlands. The re-patterning of resource use by Zwiggelte farmers, new territory
based cooperatives or the production of good manure, the emergence of these different types
of (sets of ) novelties can’t be isolated from strongly territory- and trust based networks and
relationships. Availability of bridging social capital might be of specific importance for the
unfolding of novelty promises, which relates closely to the characteristics of strategic niche
management as defined earlier and illustrated in particular by the NFW case as a multi-
dimensional process to mobilize ‘external’ and/or institutional support and to create the
necessarily ‘protected space’ for further novelty development.

Secondly, (different forms of) social capital might be simultaneously a prerequisite as well as
the outcome of novelty production. Through novelty production, trust based relationships as a
key component of social capital, might be actively re-constructed and/ or strengthened by its
translation in other forms of capital (e.g. economic capital in the case of the Zwiggelte
novelties, economic and cultural capital in the case of territorial cooperatives, etc.)

3. New tendencies

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Sawhney and Wolcott, pointed recently (Agri Holland newsletter 06-02-2006) that large
companies are often less successful innovators due to management approaches that persist in
different kinds of innovation ‘myths’. These myths are summarized in the following phrases:
1) we need more ideas (lack of recognition of innovativeness among direct stakeholders); 2)
innovation exclusively takes places in specific departments (idem);3) people just need space
to innovate (denial of the relevance of institutional embedding of innovations); 4) innovation
entail radical breaks with the past (successful innovations would be mostly all but radical); 5)
mistakes are expensive (in stead of recognizing that early experiments allows for fine-tuning);
6) avoid by-passes ( in stead of recognizing that alternative directions could become in later
stages promising application fields).

Institutional settings could respond in different ways to such changing ideas on innovation
processes. In the Netherlands, e.g. in last decade a variety of multiple stakeholder innovation
networks have been created in agriculture and rural development. Some of these networks
indeed function as ‘communities of practices’ (Wenger,1998 and 2002) actively in search for
and the facilitation of ’practice’ driven novelties that contain specific sustainability promises
(Wolleswinkel et al, 2004). For different reasons (lack of institutional and professional
interests in field research, complexity of multidisciplinary research, ideological; preferences,
etc.), many networks, however, continue to be primarily driven by ‘top-down’ approaches,
‘high tech’ biases, dominant doctrines as scale based efficiencies, etc.

In innovation literature the barriers for novelty production are increasingly recognized and
conceptualized in terms of needs for strategic niche management (SNM). SNM has been
defined as ‘the simultaneously managing of both technical and institutional change and
smoothing the diffusion process of promising novelties’ (Moors, 2004). Roep et al (2003)
emphasize that SNM is about bringing together knowledge and expertise of users and other
actors, like policy makers, researchers or representatives of public interests into a process of
smart experimentation and an active creation and maintenance of room for novelty production
and experimentation by farmers (Wiskerke, 2002; Roep and Wiskerke, 2004). In our ‘good
manure’ case it was and is the territorial cooperative Noordelijke Friese Wouden (NFW) that
plays a crucial role in this active creation of ‘protected room’ for novelty production.

The example of the NFW cooperative allows for the distinction of several dimensions of
strategic niche management (see figure 4). Together these dimensions describe the multi-
dimensional nature of the linkages that relate NFW to, and simultaneously distantiate it from
prevailing regimes (Wiskerke et al, 2003).

The governance dimension refers in the NFW case in particular to the capacity to play
simultaneously on different chess boards and to co-ordinate the differently located ‘moves’
into an adequate and progressively evolving flow through time. Governance is about
negotiated development in the arenas composed by different domains of state regulation,
about the creation of exemptions to certain of these rules and/or about other ways to deal with
otherwise highly disarticulated routines and procedures. It equally is about the creation of a
smoothly running internal organization and adequately functioning technical services to be
offered to the members. Above all, it is the co-ordination of these different arenas that is
central to this type of governance. If governance is successful, it results in room to unfold and
tie together promising novelties, thus producing a double capacity to deliver (or, as it is
locally formulated, “to do it better”): to deliver benefits and ways out for the associated
farmers as well as to deliver to local, regional and national society those qualities that are

12
needed but which cannot be produced through a straight forward and unmediated imposition
of regulatory schemes (Eshuis, 2006). In the figure this is referred to as effective and
progressive reformism. Effective and progressive reformism not only refers to intentions,
possibilities and projections. It refers above all to newly induced practices (hence, reforms)
and to the associated results and outcomes that are superior to the ones normally realized
(hence, effective). Effective reformism refers to the capacity to get things done, it results in a
positive record that strengthens the coalitions that are strategic for governance but equally in
as far as e.g. the dimension of politics is concerned.

Figure 4: SNM dimensions within the NFW case

Effective and Autonomy and

progressive governance
agency
reformism

NFW AS
NICHE

integration politics knowledge

Integration refers to the need to glue different activities together in a seamless pattern. It
implies going beyond the many dissimilarities and discontinuities entailed in generic and
segmented regulatory schemes of the central state. Integration might also occur within a wider
network, by e.g. coordinating local activities in such a way that they fit into provincial
programs. Together integration, effective reformism and good governance make for
attractiveness: “something nice is happening over there”. This attractiveness resulted, already
in an early stage, in a visit of the crown prince to the NFW and in the winning of a prestigious
innovation prize from the Ministry of Spatial Planning and Environment. On their turn such
(and other) symbols considerably helped to strengthen e.g. governance. This, then, is how
synergy functions.

Knowledge is a next crucial dimension. In the Dutch society that understands and orders itself
as a ‘knowledge based society’ it increasingly applies that only those things are allowed for
that have been ‘proven’ to function well. Returning again to “good manure”, it is to be
signaled that the main argument against it, right at the beginning, was that it “had not been
proven”. Thus, a timely construction of new knowledge (or at least the timely design of
appropriate research proposals) becomes crucial, not only in the arena where NFW meets the
state apparatuses, but also for the participating farmers: as indicated earlier, novelties are to be
‘unpacked’, to be understood, in order to be developed further. And the more these novelties

13
cross the borderline that separates the known from the unknown, the more attractive it
becomes for the related scientists: niches as NFW are, in a way, the places where “the music
is being played”. On the other hand it applies that crossing these borderlines often turns this
dimension into a “battleground of knowledge” (Long and Long, 1992).

Politics refers to the capacity to involve, engage, mobilize and use the support of ‘others’ in
order to create, to defend and to expand the required room for manoeuvre. The creation and
maintenance of this room (that is, the creation of a strategic niche) has been far from easy –
and in no way a smooth and unilineair process going towards expanded self-regulation - on
the contrary. In retrospect it has been decisive that from the formation of the first nuclei
onwards, NFW could time and again involve the Standing Committee on Agriculture of
Dutch Parliament in order to correct decisions of the national Ministry of Agriculture. Several
times this committee intervened on behalf of NFW. There are good relations with members of
parliament of a broad range of parties, which goes back, a.o., to the fact that several of them
have been invited to the area and played some role in the internal discussions and institutional
steps. Simultaneously, the very existence of NFW represents for them an important point of
reference to critically examine the overall development of policy proposals from the Ministry
– especially because NFW represents a practice indicating that “things can be done better”.
The link with Parliament is also strengthened through the strong intertwinement of NFW with
a range of other local and regional entities and political bodies such as e.g. the Province of
Fryslân, the Friesian Nature Movement, the Fryske Gea and Landscape Management
Friesland. Due to this wide support and solid embedding, the cooperative emerges as a
mediating point par excellence – and that is what politicians need. On the other hand, support
from politicians is often indispensable. Many times the further development of NFW has been
threatened if not blocked. It was only through the mobilization of a large support network (in
which members of parliament had a pivotal position) that these blockades could be lifted in
time.

So far the characteristics of strategic niche management within the NFW cooperative as an
example how new territory based institutional arrangements are actively trying to mobilize
room for manoeuvre for novelties. It is important to realize that novelty production might be
also grounded on territory based constellations with ancient roots, as e.g. in the case of the
rural estate that we visited in Hemmen. The rural estate manager not only described ongoing
initiatives and ideas for further development, but also gave us an impression of his niche
management capacities to strengthen rural development building on territory based linkages
between traditional and newly emerging rural markets.

4. Borderline cases / Questions to be discussed

This document on novelty production raises several theoretical and methodological issues of
relevance for our ETUDE project.

14
Theoretical framework and empirical evidence are primarily building on and inspired by
Italian and Dutch material. This raises questions as: are we not slotting in, right from the
beginning, a bias into our analysis? Are farmers all over Europe indeed relevant actors in
novelty production?

Obviously, these questions are of importance in relation to case selection as well as

delineation of case study areas. The same goes for the major argument that “novelties are, in
one or more ways, ‘at odds’ with reigning regimes”(Wiskerke and Ploeg, 2004: 12). To what
extent should we conclude from this argument that it is necessary to focus on productive /
promising ‘bridges’ between regimes and novelty production? The latter also translates to the
governance of rural markets and the question: how do new forms of governance facilitate and
strengthen high levels of contextual knowledge that, consequently, allow for high levels of
novelty production?

Other important methodological issues still to be resolved include questions as: to what extent
will it be possible to assess, directly or indirectly, the level of contextual knowledge, the
presence of learning processes and the dynamics and impact of novelty production? Is it
necessary to do so? And how could it be done in the ETUDE framework?

15
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