IDEAS home Printed from https://ideas.repec.org/p/hhs/cbsnow/2002_007.html
   My bibliography  Save this paper

High-tech clusters, technology spillovers, and trade secret laws

Author

Listed:
  • Fosfuri, Andrea

    (Universidad Carlos III de Madrid)

  • Rønde, Thomas

    (University of Mannheim)

Abstract

We analyze firms’ incentives to cluster in an industrial district to benefit from reciprocal technology spillovers. A simple model of cumulative innovation is presented where technology spillovers arise endogenously through labor mobility. It is shown that firms’ incentives to cluster are the strongest when the following three conditions are met: 1) technological progress is rapid; 2) competition in the product market is relatively soft; 3) the probability of a single firm to develop an innovation is neither very high nor very low. We show that some trade secret protection is always beneficial for firms’ profits and stimulates clustering. Excessive protection may impede technology spillovers and reduce firms’ incentives to cluster.

Suggested Citation

  • Fosfuri, Andrea & Rønde, Thomas, 2002. "High-tech clusters, technology spillovers, and trade secret laws," Working Papers 07-2002, Copenhagen Business School, Department of Economics.
  • Handle: RePEc:hhs:cbsnow:2002_007
    as

    Download full text from publisher

    File URL: http://openarchive.cbs.dk/cbsweb/handle/10398/6784
    Download Restriction: no

    References listed on IDEAS

    as
    1. Pakes, Ariel & Nitzan, Shmuel, 1983. "Optimum Contracts for Research Personnel, Research Employment, and the Establishment of "Rival" Enterprises," Journal of Labor Economics, University of Chicago Press, vol. 1(4), pages 345-365, October.
    2. Combes, Pierre-Philippe & Duranton, Gilles, 2006. "Labour pooling, labour poaching, and spatial clustering," Regional Science and Urban Economics, Elsevier, pages 1-28.
    3. Banerjee, Abhijit & Weibull, Jörgen W., 1993. "Evolutionary Selection with Discriminating Players," Working Paper Series 375, Research Institute of Industrial Economics.
    4. Hans Gersbach & Armin Schmutzler, 2003. "Endogenous spillovers and incentives to innovate," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), pages 59-79.
    5. Paul Almeida & Bruce Kogut, 1999. "Localization of Knowledge and the Mobility of Engineers in Regional Networks," Management Science, INFORMS, pages 905-917.
    6. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    7. Acs, Zoltan J & Audretsch, David B & Feldman, Maryann P, 1994. "R&D Spillovers and Recipient Firm Size," The Review of Economics and Statistics, MIT Press, pages 336-340.
    8. Thomas Rønde, 2001. "Trade Secrets and Information Sharing," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(3), pages 391-417, September.
    9. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, Oxford University Press, pages 577-598.
    10. Motta, Massimo & Rønde, Thomas, 2002. "Trade secret laws, labor mobility, and innovations," Working Papers 08-2002, Copenhagen Business School, Department of Economics.
    11. Cooper, David P., 2001. "Innovation and reciprocal externalities: information transmission via job mobility," Journal of Economic Behavior & Organization, Elsevier, vol. 45(4), pages 403-425, August.
    12. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, pages 630-640.
    13. Cheung, Steven N S, 1982. "Property Rights in Trade Secrets," Economic Inquiry, Western Economic Association International, vol. 20(1), pages 40-53, January.
    14. James Bessen & Eric Maskin, 2009. "Sequential innovation, patents, and imitation," RAND Journal of Economics, RAND Corporation, pages 611-635.
    15. Massimo Filippini, 2001. "Economies of scale in the Swiss nursing home industry," Applied Economics Letters, Taylor & Francis Journals, pages 43-46.
    16. Jerry R. Green & Suzanne Scotchmer, 1995. "On the Division of Profit in Sequential Innovation," RAND Journal of Economics, The RAND Corporation, pages 20-33.
    17. Suzanne Scotchmer, 1991. "Standing on the Shoulders of Giants: Cumulative Research and the Patent Law," Journal of Economic Perspectives, American Economic Association, pages 29-41.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Cumulative innovation; industrial districts; intellectual property rights; technology spillovers;

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:cbsnow:2002_007. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lars Nondal). General contact details of provider: http://edirc.repec.org/data/incbsdk.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.