Technological Diversity and Jacobs' Externality Hypothesis Revisited
AbstractRecent empirical evidence strongly supports Jacobs's (1969) externality hypothesis that urban diversity provides a more favorable environment for economic development than urban specialization. In order to correctly gauge Jacobs's hypothesis, economic development should be understood as a result of innovations. Furthermore, a relevant diversity measure should take into account the degree of diversity of the inherent classes (e.g. pharmaceuticals are closer to chemicals than to forestry). These ideas are tested using regionally classified Swedish patent application data as a measure of innovativeness. Patent data are also used to reflect technological diversity. The results show that the number of patent applications in Swedish regions is highly and positively dependent on regional technological specialization, quite the opposite of Jacobs's prediction. This paper raises general questions about earlier empirical results. It is concluded that the size of regions is an important factor to consider, since this in itself may affect patenting intensity and technological diversity. Copyright 2005 Blackwell Publishing Ltd..
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Bibliographic InfoArticle provided by Gatton College of Business and Economics, University of Kentucky in its journal Growth and Change.
Volume (Year): 36 (2005)
Issue (Month): 2 ()
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0017-4815
Other versions of this item:
- Ejermo, Olof, 2004. "Technological Diversity and Jacobs' Externality Hypothesis Revisited," Working Paper Series in Economics and Institutions of Innovation 16, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
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