The paper introduces potential niches for Interreg and NEXT programmes in relation to entrepreneurial development in cross-border and transnational functional areas. The ideas presented here have been inspired by an exchange between ESPON, Interreg stakeholders and representatives of the Directorates-General for Research and Innovation (DG RTD) and Internal Market, Industry, Entrepreneurship and SMEs (DG GROW) within the framework of the seminar ‘Change the perspective! From cross-border to interaction area’ that took place in June 2019 in Dresden, Germany. 

This paper is not the result of empirical analysis but is presenting the conceptual framework only. The empirical model that can be tested in certain cross-border or transnational areas, or across these functional areas, builds largely on the model applied by the knowledge spillover theory of entrepreneurship. Using the same set of variables, the Interreg niche model adds the notion of knowledge spillovers through knowledge imports (e.g. appropriation of open research results, open data or other knowledge residuals from abroad) as well as recognition of high-impact industrial sectors, which are considered as particularly competitive and fertile for the economy of the cross-border or transnational functional area (FA). The latter can be a result of cross-border or transnational regional smart specialization and entrepreneurial discovery processes.

The paper introduces a number of valuable observations already documented by the European Commission, the Interreg CENTRAL EUROPE programme, and INTERACT that gave rise to the empirical model.