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The Influence of Location on the Use by SMEs of External Advice and Collaboration: Detailed Econometric Estimates


  • Robert Bennett
  • Paul Robson
  • William Bratton


This paper provides a large scale analysis of the influence of location on the extent of use and impact of external advice and collaboration on small and medium sized enterprises (SMEs) in Britain. The analysis indicates that for private sector advisors (accountants, consultants etc) and collaboration with suppliers and customers, the intensity of use does not vary significantly with location in most cases. Only the input of business friends and relatives is strongly locationally constrained. EU Structural Fund status of an area also has few major effects on use of private sector advice. However, the impact of external advice, and the extent of local collaboration between similar firms, is influenced by location, with impact generally increasing with the size of business concentration, density and closeness to a business centre; i.e. there are positive effects of urban location and agglomeration economies. For public sector support agencies (such as the Small Business Service Business Link, TECs/LECs, enterprise agencies, and also chambers of commerce) the reverse is generally true. Levels of use are locationally influenced but impact is not.

Suggested Citation

  • Robert Bennett & Paul Robson & William Bratton, 2000. "The Influence of Location on the Use by SMEs of External Advice and Collaboration: Detailed Econometric Estimates," Working Papers wp190, Centre for Business Research, University of Cambridge.
  • Handle: RePEc:cbr:cbrwps:wp190
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    Cited by:

    1. Schwartz, Dafna & Bar-El, Raphael, 2002. "Targeted consultancy services as an instrument for the development of rural SMEs - a brazilian case," ERSA conference papers ersa02p200, European Regional Science Association.
    2. Kai Hänninen & Harri Jokela & Martti Saarela & Anna-Mari Simunaniemi, 2017. "Micro-Business Owner-Managers’ Growth Intentions in Sparsely Populated Areas in Northern Finland," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 15(1 (Spring), pages 3-22.

    More about this item


    Business Advice; Business Link; Logit; Ordered Logit; Location;

    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General

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