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The Downside of Knowledge Spillovers: An Explanation for the Dispersion of High-tech Industries

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  • Christoph Alsleben
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    Abstract

    Both theoretical work on knowledge spillovers and regional policy initiatives often assume that there exists a general and unanimous advantage for firms to cluster. But opposed to the benefit is the disadvantage of sharing knowledge with other (rival) firms. This paper highlights the "downside" associated with knowledge spillovers and presents a four-stage game of location choice where spillovers result from labour poaching and where the strategic interaction between firms may make them avoid colocation with spillovers. The model follows Combes and Duranton (2001) and provides an explanation for the dispersion of German high-tech industries we found in a companion paper.

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    Bibliographic Info

    Paper provided by University of Dortmund, Department of Economics in its series Discussion Papers in Economics with number 04_01.

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    Length: 32 pages
    Date of creation: Mar 2004
    Date of revision:
    Handle: RePEc:mik:wpaper:04_01

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