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Industrial Clustering and the Returns to Inventive Activity Canadian Biotechnology Firms, 1991-2000

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  • Barak S. Aharonson
  • Joel A.C. Baum
  • Maryann P. Feldman

Abstract

We examine how industrial clustering affects biotechnology firms’ innovativeness, contrasting similar firms not located in clusters or located in clusters that are or are not focused on the firm’s technological specialization. Using detailed firm level data, we find clustered firms are eight times more innovative than geographically remote firms, with largest effects for firms located in clusters strong in their own specialization. For firms located in a cluster strong in their specialization we also find that R&D productivity is enhanced by a firm’s own R&D alliances and also by the R&D alliances of other colocated firms.

Suggested Citation

  • Barak S. Aharonson & Joel A.C. Baum & Maryann P. Feldman, 2004. "Industrial Clustering and the Returns to Inventive Activity Canadian Biotechnology Firms, 1991-2000," DRUID Working Papers 04-03, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    • Handle: RePEc:aal:abbswp:04-03
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    Cited by:

    1. Emilie-Pauline Gallie & Diego Legros, 2007. "How Do Spatial Spillovers Diffuse In Science-Industry Interactions? The Case Of French Biotech Sector," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 16(8), pages 635-652.
    2. Julien Pénin, 2005. "Three Consequences of Considering Innovation as a Collective Process and Knowledge as a Collective Good," Journal of Information & Knowledge Management (JIKM), World Scientific Publishing Co. Pte. Ltd., vol. 4(01), pages 15-27.
    3. Li Fang, 2018. "The Dual Effects of Information Technology Clusters: Learning and Selection," Economic Development Quarterly, , vol. 32(3), pages 195-209, August.
    4. Emilie-Pauline Gallie, 2009. "Is Geographical Proximity Necessary for Knowledge Spillovers within a Cooperative Technological Network? The Case of the French Biotechnology Sector," Regional Studies, Taylor & Francis Journals, vol. 43(1), pages 33-42.
    5. Li Fang, 2020. "Agglomeration and innovation: Selection or true effect?," Environment and Planning A, , vol. 52(2), pages 423-448, March.
    6. S. Phineas Upham & Lori Rosenkopf & Lyle H. Ungar, 2010. "Positioning knowledge: schools of thought and new knowledge creation," Scientometrics, Springer;Akadémiai Kiadó, vol. 83(2), pages 555-581, May.
    7. Li Fang, 2019. "Manufacturing Clusters and Firm Innovation," Economic Development Quarterly, , vol. 33(1), pages 6-18, February.
    8. Gilsing, V.A. & Nooteboom, B., 2004. "Co-evolution in innovation systems: the case of pharmaceutical biotechnology," Working Papers 04.09, Eindhoven Center for Innovation Studies.
    9. Philip Shapira & Jan Youtie, 2008. "Emergence of Nanodistricts in the United States," Economic Development Quarterly, , vol. 22(3), pages 187-199, August.
    10. Feldman, Maryann & Martin, Roger, 2005. "Constructing jurisdictional advantage," Research Policy, Elsevier, vol. 34(8), pages 1235-1249, October.
    11. Antoine Bureth & Julien Pénin & Sandrine Wolff, 2010. "Start-Up Creation In Biotechnology: Lessons From The Case Of Four New Ventures In The Upper Rhine Biovalley," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 14(02), pages 253-283.
    12. C. Michael Wernerheim, 2008. "The tendency of advanced services to co-locate and the implications for regional government policy," The Service Industries Journal, Taylor & Francis Journals, vol. 30(5), pages 731-748, May.
    13. Barak S. Aharonson & Suleika Bort & Michael Woywode, 2020. "The Influence of Multinational Corporations on International Alliance Formation Behavior of Colocated Start-Ups," Organization Science, INFORMS, vol. 31(3), pages 770-795, May.
    14. Hamidreza Eslami & Ashkan Ebadi & Andrea Schiffauerova, 2013. "Effect of collaboration network structure on knowledge creation and technological performance: the case of biotechnology in Canada," Scientometrics, Springer;Akadémiai Kiadó, vol. 97(1), pages 99-119, October.
    15. S. Phineas Upham & Lori Rosenkopf & Lyle H. Ungar, 2010. "Innovating knowledge communities," Scientometrics, Springer;Akadémiai Kiadó, vol. 83(2), pages 525-554, May.

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    More about this item

    Keywords

    Biotechnology; industrial clustering; knowledge spillovers; R&D productivity; strategic alliances;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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