Location Attributes and Start-Ups in Knowledge Intensive Business Services
AbstractWe study start-ups in Knowledge Intensive Business Services (KIBS) across regions in Sweden by individuals with a formally recognized capacity to produce and develop advanced business services. The empirical analysis is based on a theoretical framework which emphasizes both supply- and demand-side factors. Supply-side variables pertain to accessibility to knowledge and information upon which a new firm can be established. Demand-side variables refer to market-size and pertain to the ability to recover fixed start-up costs and economize on costs associated with face-to-face interaction. 78 percent of the KIBS founders have prior work experience from business services, suggesting that KIBS start-ups are more frequent in regions where the KIBS sector is already large. Controlling for the stock of potential entrepreneurs and the stock KIBS firms, we show that both supply- and demand-side factors influence KIBS start-up activity. Results are consistent with that KIBS start-ups are stimulated by the simultaneous presence of (i) knowledge resources conducive for the generation and diffusion of knowledge and ideas upon which new firms can be established and (ii) a large market. The findings suggest that the geography of KIBS is shaped in cumulative and self-reinforcing processes, and can explain the tendency of KIBS firms to agglomerate in large city-regions.
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Bibliographic InfoPaper provided by Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies in its series Working Paper Series in Economics and Institutions of Innovation with number 116.
Length: 23 pages
Date of creation: 27 Feb 2008
Date of revision:
Publication status: Published in Industry and Innovation, 2009, pages 103-121.
Contact details of provider:
Postal: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Phone: +46 8 790 95 63
Web page: http://www.infra.kth.se/cesis/
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knowledge intensive business services; knowledge spillovers; start-ups; entrepreneurship; location;
Other versions of this item:
- Martin Andersson & Karin Hellerstedt, 2009. "Location Attributes and Start-ups in Knowledge-Intensive Business Services," Industry and Innovation, Taylor & Francis Journals, vol. 16(1), pages 103-121.
- L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
- L84 - Industrial Organization - - Industry Studies: Services - - - Personal, Professional, and Business Services
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-03-01 (All new papers)
- NEP-ENT-2008-03-01 (Entrepreneurship)
- NEP-GEO-2008-03-01 (Economic Geography)
- NEP-KNM-2008-03-01 (Knowledge Management & Knowledge Economy)
- NEP-URE-2008-03-01 (Urban & Real Estate Economics)
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- Andersson, Martin & Baltzopoulos, Apostolos & Lööf, Hans, 2010.
"R&D Strategies and Entrepreneurial Spawning,"
Working Paper Series in Economics and Institutions of Innovation
228, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
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