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Spatial embeddedness and firm performance: an empirical exploration of the effects of proximity on innovative and economic performance

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Author Info
Oerlemans, Leon A.G. ()
Meeus, Marius T.H. ()
Abstract

Recent theoretical developments in organisation science and regional economics have emphasised the importance of networks and geographical proximity for the performance of firms. Empirical evidence on these relationships is scarce, though, especially in regional science. In this paper, we address the following research question: to what extent do firm-specific resources, organisational embeddedness, proximity, and industry factors influence innovative and economic outcomes of innovative firms? We used a theoretical synthesis of regional and organisational science to build a research model that enabled us to derive several hypotheses on the influence of proximity on outcomes, taking other important predictors for performance into account. Our empirical findings confirm the importance of proximity especially for innovative outcomes. Moreover, we found that in particular network relations with buyers and suppliers are conducive for firm performance, whereas other indicators of embeddedness and of internal resources have little impact probably due to substitution effects. Finally, regional as well sectoral R&D spillovers influence outcomes in a positive way.

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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa02p054.

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Date of creation: Aug 2002
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Handle: RePEc:wiw:wiwrsa:ersa02p054

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Birgitte Gregersen, Björn Johnson, 1997. "Learning Economies, Innovation Systems and European Integration," Regional Studies, Taylor and Francis Journals, vol. 31(5), pages 479-490, July. [Downloadable!] (restricted)
  2. Love, James H. & Roper, Stephen, 2001. "Location and network effects on innovation success: evidence for UK, German and Irish manufacturing plants," Research Policy, Elsevier, vol. 30(4), pages 643-661, April. [Downloadable!] (restricted)
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  3. Zvi Griliches, 1992. "The Search for R&D Spillovers," NBER Working Papers 3768, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-40, June. [Downloadable!] (restricted)
  5. Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-96, September. [Downloadable!] (restricted)
  6. Harabi, N., 1995. "Channels of R & D Spillovers: An Empirical Investigation," Papers 37, Universitat Zurich - Wirtschaftswissenschaftliches Institut.
  7. Roberta Capello, 1999. "Spatial Transfer of Knowledge in High Technology Milieux: Learning Versus Collective Learning Processes," Regional Studies, Taylor and Francis Journals, vol. 33(4), pages 353-365, June. [Downloadable!] (restricted)
  8. Bart Verspagen & Marjolein C.J. Cani, ls, 2001. "Barriers to knowledge spillovers and regional convergence in an evolutionary model," Journal of Evolutionary Economics, Springer, vol. 11(3), pages 307-329. [Downloadable!] (restricted)
  9. Audretsch, David B, 1998. "Agglomeration and the Location of Innovative Activity," CEPR Discussion Papers 1974, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  10. Wilbur R. Thompson, 1962. "Locational Differences in Inventive Effort and Their Determinants," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 253-272 National Bureau of Economic Research, Inc. [Downloadable!]
  11. DeBresson, Chris & Amesse, Fernand, 1991. "Networks of innovators :A review and introduction to the issue," Research Policy, Elsevier, vol. 20(5), pages 363-379, October. [Downloadable!] (restricted)
  12. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December. [Downloadable!] (restricted)
  13. Keith Smith, . "Interactions in knowledge systems: Foundations, policy implications and empirical methods," STEP Report series 199410, The STEP Group, Studies in technology, innovation and economic policy. [Downloadable!]
  14. Leon A.G. Oerlemans & Marius T.H. Meeus & Frans W.M. Boekema, 1998. "Do Networks Matter for Innovation? The usefulness of the economic network approach in analysing innovation," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 89(3), pages 298-309, 08. [Downloadable!] (restricted)
  15. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September. [Downloadable!] (restricted)
  16. Soete,Luc & Weel,Bas,ter, 1999. "Innovation, Knowledge Creation and Technology Policy in Europe," Research Memoranda 001, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
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  1. Werner Bönte, 2003. "Innovation and Employment Growth in Industrial Clusters: Evidence from Aeronautical Firms in Germany," ERSA conference papers ersa03p284, European Regional Science Association. [Downloadable!]
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