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Spatial proximity and complementarities in the trading of tacit knowledge

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  • Aydogan, Neslihan
  • Lyon, Thomas P.

Abstract

We model knowledge-trading coalitions in which the transfer of tacit knowledge is unverifiable and requires face-to-face contact, making spatial proximity important. When there are sufficient “complementarities” in knowledge exchange, successful exchange is facilitated if firms can meet in a central location,thereby economizing on travel costs. When complementarities are small,however, a central location may be undesirable because it is more vulnerable to cheating than a structure involving bilateral travel between firms. We believe that our framework may help explain the structure and stability of multimember technology trading coalitions such as Sematech and Silicon Valley.

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Bibliographic Info

Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 22 (2004)
Issue (Month): 8-9 (November)
Pages: 1115-1135

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Handle: RePEc:eee:indorg:v:22:y:2004:i:8-9:p:1115-1135

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Web page: http://www.elsevier.com/locate/inca/505551

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Cited by:
  1. Nobuaki Hamaguchi & Yoshihiro Kameyama, 2006. "Communication Externalities on the Knowledge-based Firms in Metropolitan Areas: Case Study of China and Korea," Discussion Paper Series 182, Research Institute for Economics & Business Administration, Kobe University.
  2. Neslihan Aydogan & Thomas P. Lyon, 2004. "Spatial Proximity and Complementarities in the Trading of Tacit Knowledge," Microeconomics 0404004, EconWPA.

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