What When Space Matters Little For Firm Productivity? A multilevel analysis of localised knowledge externalities
AbstractThis paper contributes to the debate on localized knowledge externalities as potential source for firm productivity gains. We apply multilevel analysis to link firm productivity (and growth) to knowledge intensive spatial contexts in the Netherlands. If localized knowledge externalities are important, then firms are hypothesised to co-locate in order to capitalize on each other's knowledge stocks. We conceptualise the regional knowledge base by three dimensions: local 'research and development' intensity, local 'innovativeness', and the characterization of locations by a ‘knowledge workers’ dimension (based on ICT use, educational level, communicative and creative skills). Controlling for firm's heterogeneity, we find a relatively small spatial effect: regional characteristics contribute for only a few percents to firm productivity. The regional intensity of 'innovation' most significantly contributes to this effect. We do not find a contextual spatial effect for productivity growth. These results suggest that the territorial dimension of knowledge externalities should not be exaggerated.
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Bibliographic InfoPaper provided by Utrecht University, Section of Economic Geography in its series Papers in Evolutionary Economic Geography (PEEG) with number 0706.
Length: 30 pages
Date of creation: Jun 2007
Date of revision: Jun 2007
productivity; multilevel analysis; localized knowledge externalities; Netherlands;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-07-13 (All new papers)
- NEP-EFF-2007-07-13 (Efficiency & Productivity)
- NEP-GEO-2007-07-13 (Economic Geography)
- NEP-INO-2007-07-13 (Innovation)
- NEP-KNM-2007-07-13 (Knowledge Management & Knowledge Economy)
- NEP-LAB-2007-07-13 (Labour Economics)
- NEP-URE-2007-07-13 (Urban & Real Estate Economics)
You can help add them by filling out this form.
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