This project will provide insightful knowledge on cross-border regional cooperation in terms of how different types of proximity and levels of integration of cross-border regional innovation systems (CBRIS) impact on knowledge transfer mechanisms and levels of innovativeness in SMEs. More specifically, the study will address the following objectives: 1) Compare the effects of different types of proximity on knowledge transfer and innovativeness amongst SMEs in cross-border regions (CBRs), 2) Develop a methodology for measuring the levels of integration of CBRISs and 3) Evaluate the success of INTERREG cross-border cooperation projects in facilitating cross-border knowledge flows and innovation in the service industries, through a tourism case study. The study will utilize both quantitative and qualitative methods, as well as both comparative EU-level data and in depth case study materials (statistical, survey and interview data). This project will make an original theoretical and empirical contribution, through being the first substantial empirical study of the theoretical underpinnings of CBRISs, levels of integration of CBRs and knowledge transfer and joint innovation in tourism cross-border cooperation projects. These original contributions are highly policy relevant as the long term success of CBRs depends on collective efforts to further integration on a trans-regional level in order to develop common innovation systems. This underlines the importance of investigating the possibilities of (sustainable) socio-economic and socio-cultural development in these regions to meet the cohesion goals of the EU. Therefore, the study will provide an analysis of `best practices´ not only for the case study policy makers but also for other EU CBRs and cross-border cooperation projects in order to enhance European competitiveness as a whole.