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The Knowledge Economy and Urban Economic Growth

  • Otto Raspe


  • Frank van Oort


In this paper we contribute to the longstanding discussion on the role of knowledge to economic growth in a spatial context. We observe that in adopting the European policy strategy towards a competitive knowledge economy, The Netherlands is – as most European countries - mainly oriented towards industrial, technological factors. The policy focus is on R&D specialized regions in their spatial economic strategies. We place the knowledge economy in a broader perspective. Based on the knowledge economy literature, we value complementary indicators: the successful introduction of new products and services to the market (‘innovation’) and indicators of skills of employees (‘knowledge workers’). Using econometric analysis, we relate the three factors ‘R&D’, ‘innovation’ and ‘knowledge workers’ to regional economic growth. We conclude that the factors ‘innovation’ and ‘knowledge workers’ are more profoundly related to urban employment and productivity growth than the R&D-factor. Preferably, urban research and policymakers should therefore take all three knowledge factors into account when determining economic potentials of cities.

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Paper provided by Utrecht University, Section of Economic Geography in its series Papers in Evolutionary Economic Geography (PEEG) with number 0607.

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Length: 33 pages
Date of creation: Apr 2006
Date of revision: Apr 2006
Handle: RePEc:egu:wpaper:0607
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  1. Henry van der Wiel & George van Leeuwen, 2003. "Do ICT spillovers matter; evidence from Dutch firm-level data," CPB Discussion Paper 26, CPB Netherlands Bureau for Economic Policy Analysis.
  2. Frank van Oort & Anet Weterings & Heleen Verlinde, 2003. "Residential amenities of knowledge workers and the location of ICT-FIrms in the Netherlands," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 94(4), pages 516-523, 09.
  3. Koen Frenken & Frank Van Oort & Thijs Verburg, 2007. "Related Variety, Unrelated Variety and Regional Economic Growth," Regional Studies, Taylor & Francis Journals, vol. 41(5), pages 685-697.
  4. Henderson, J. Vernon, 2003. "Marshall's scale economies," Journal of Urban Economics, Elsevier, vol. 53(1), pages 1-28, January.
  5. Combes, Pierre-Philippe & Magnac, Thierry & Robin, Jean-Marc, 2004. "The Dynamics of Local Employment in France," IZA Discussion Papers 1061, Institute for the Study of Labor (IZA).
  6. Godin, Benoit, 2004. "The New Economy: what the concept owes to the OECD," Research Policy, Elsevier, vol. 33(5), pages 679-690, July.
  7. Dominique Foray, 2006. "The Economics of Knowledge," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262562235, June.
  8. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  9. McCloskey, Donald & Klamer, Arjo, 1995. "One Quarter of GDP Is Persuasion," American Economic Review, American Economic Association, vol. 85(2), pages 191-95, May.
  10. P.J.M. De Bruijn, 2004. ""MAPPING INNOVATION: REGIONAL DIMENSIONS OF INNOVATION AND NETWORKING IN THE NETHERLANDS"-super-1," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 95(4), pages 433-440, 09.
  11. Egbert Wever & Erik Stam, 1999. "Clusters of High Technology SMEs: The Dutch Case," Regional Studies, Taylor & Francis Journals, vol. 33(4), pages 391-400.
  12. Adam B. Jaffe & Manuel Trajtenberg, 2005. "Patents, Citations, and Innovations: A Window on the Knowledge Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 026260065x, June.
  13. Jaffe, Adam B, 1989. "Real Effects of Academic Research," American Economic Review, American Economic Association, vol. 79(5), pages 957-70, December.
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