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Geographically Localized Knowledge: Spillovers or Markets?


  • Zucker, Lynne G
  • Darby, Michael R
  • Armstrong, Jeff


Using detailed data on California biotechnology, the authors find that the positive impact of research universities on nearby firms relates to identifiable market exchange between particular university star scientists and firms and not to generalized knowledge spillovers. Poisson and two-stage Beckman regressions indicate the number of star-firm collaborations powerfully predicts success: for an average firm, five articles coauthored by academic stars and the firm's scientists imply about five more products in development, 3.5 more products on the market, and 860 more employees. Stars collaborating with or employed by firms, or who patent, have significantly higher citation rates than pure academic stars. Copyright 1998 by Oxford University Press.

Suggested Citation

  • Zucker, Lynne G & Darby, Michael R & Armstrong, Jeff, 1998. "Geographically Localized Knowledge: Spillovers or Markets?," Economic Inquiry, Western Economic Association International, vol. 36(1), pages 65-86, January.
  • Handle: RePEc:oup:ecinqu:v:36:y:1998:i:1:p:65-86

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