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Innovation Ideas and Regional Characteristics: Product Innovations and Export Entrepreneurship by Firms in Swedish Regions

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  • MARTIN ANDERSSON
  • BÖRJE JOHANSSON

Abstract

This paper focuses upon the ways in which characteristics of regions in regards to knowledge sources, communication opportunities, and absorptive capacity influence the development of innovation ideas among existing and potential entrepreneurs. We formulate a model where entrepreneurs or innovating firms introduce new products in a quasi-temporal setting. Market conditions are characterised by monopolistic competition between varieties belonging to the same product group, in which there is entry and exit of varieties. A stochastic process is assumed to generate new innovation ideas as time goes by, and a firm (entrepreneur) who receives such an idea has to transform the idea to an innovation, which in the model is specified as a particular variety combined with a specific destination market. The theoretical model is used as a reference when formulating two regression models, with which we estimate how a set of regional characteristics are associated with the likelihood of innovation ideas across Swedish local labour market regions. In one model, we examine the emergence of new export varieties, and in the second model, we investigate the appearance of new export firms. Results are consistent with the assumption that knowledge and information flows have a positive influence on the frequency of arrival of innovation ideas to firms. Copyright (c) 2008 Blackwell Publishing.

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Bibliographic Info

Article provided by Gatton College of Business and Economics, University of Kentucky in its journal Growth and Change.

Volume (Year): 39 (2008)
Issue (Month): 2 ()
Pages: 193-224

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Handle: RePEc:bla:growch:v:39:y:2008:i:2:p:193-224

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0017-4815

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Cited by:
  1. Klaesson, Johan & Johansson, Börje, 2008. "Agglomeration Dynamics of Business Services," Working Paper Series in Economics and Institutions of Innovation 153, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  2. Johansson, Börje & Johansson, Sara & Wallin, Tina, 2013. "Internal and External Knowledge – Innovation of Export Varieties," Working Paper Series in Economics and Institutions of Innovation 297, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  3. Martin Andersson & Hans Lööf, 2011. "Agglomeration and productivity: evidence from firm-level data," The Annals of Regional Science, Springer, vol. 46(3), pages 601-620, June.
  4. Andersson, Martin & Johansson, Börje & Månsson, Kristofer, 2009. "Dynamics of Entry and Exit of Product Varieties – what evolution dynamics can account for the empirical regularities?," Working Paper Series in Economics and Institutions of Innovation 204, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  5. Johansson, Börje & Lööf, Hans, 2008. "The Impact of Firm’s R&D Strategy on Profit and Productivity," Working Paper Series in Economics and Institutions of Innovation 156, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

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