IDEAS home Printed from https://ideas.repec.org/p/hhs/lucirc/2015_040.html
   My bibliography  Save this paper

Firm Performance in the Periphery: On the Relation between Firm-Internal Knowledge and Local Knowledge Spillovers

Author

Listed:
  • Grillitsch, Markus

    (CIRCLE, Lund University)

  • Nilsson, Magnus

    (Dept. of Business Administration and CIRCLE, Lund University)

Abstract

This paper challenges one of the fundamental propositions within economic geography; that location in knowledge regions contributes to firm performance in general and especially for knowledge intensive firms that compete on the basis of knowledge. Our analysis of Swedish micro-data on 32,535 firms from 2004-2011 provides evidence that knowledge intensive firms benefit less from local knowledge spillovers than firms with comparably low in-house knowledge. This suggests that firms with high internal competencies can compensate for a lack of local knowledge spillovers and that negative knowledge externalities may make location outside knowledge centers more beneficial for such firms.

Suggested Citation

  • Grillitsch, Markus & Nilsson, Magnus, 2015. "Firm Performance in the Periphery: On the Relation between Firm-Internal Knowledge and Local Knowledge Spillovers," Papers in Innovation Studies 2015/40, Lund University, CIRCLE - Centre for Innovation Research.
    • Handle: RePEc:hhs:lucirc:2015_040
    as

    Download full text from publisher

    File URL: http://wp.circle.lu.se/upload/CIRCLE/workingpapers/201540_Grillitsch_Nilsson.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Combes, Pierre-Philippe & Duranton, Gilles, 2006. "Labour pooling, labour poaching, and spatial clustering," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 1-28, January.
    2. Adrian Healy & Kevin Morgan, 2012. "Spaces of Innovation: Learning, Proximity and the Ecological Turn," Regional Studies, Taylor & Francis Journals, vol. 46(8), pages 1041-1053, June.
    3. J. Myles Shaver & Fredrick Flyer, 2000. "Agglomeration economies, firm heterogeneity, and foreign direct investment in the United States," Strategic Management Journal, Wiley Blackwell, vol. 21(12), pages 1175-1193, December.
    4. Martin Andersson & Olof Ejermo, 2005. "How does accessibility to knowledge sources affect the innovativeness of corporations?—evidence from Sweden," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 39(4), pages 741-765, December.
    5. Ron Boschma & Rikard H. Eriksson & Urban Lindgren, 2014. "Labour Market Externalities and Regional Growth in Sweden: The Importance of Labour Mobility between Skill-Related Industries," Regional Studies, Taylor & Francis Journals, vol. 48(10), pages 1669-1690, October.
    6. Michael Storper & Anthony J. Venables, 2004. "Buzz: face-to-face contact and the urban economy," Journal of Economic Geography, Oxford University Press, vol. 4(4), pages 351-370, August.
    7. Richard E. Baldwin & Toshihiro Okubo, 2006. "Heterogeneous firms, agglomeration and economic geography: spatial selection and sorting," Journal of Economic Geography, Oxford University Press, vol. 6(3), pages 323-346, June.
    8. Franz Huber, 2012. "Do clusters really matter for innovation practices in Information Technology? Questioning the significance of technological knowledge spillovers," Journal of Economic Geography, Oxford University Press, vol. 12(1), pages 107-126, January.
    9. Asheim, Bjorn T & Isaksen, Arne, 2002. "Regional Innovation Systems: The Integration of Local 'Sticky' and Global 'Ubiquitous' Knowledge," The Journal of Technology Transfer, Springer, vol. 27(1), pages 77-86, January.
    10. Bengt-ake Lundvall & Bjorn Johnson, 1994. "The Learning Economy," Industry and Innovation, Taylor & Francis Journals, vol. 1(2), pages 23-42.
    11. Brouwer, Erik & Kleinknecht, Alfred, 1999. "Innovative output, and a firm's propensity to patent.: An exploration of CIS micro data," Research Policy, Elsevier, vol. 28(6), pages 615-624, 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, vol. 86(3), pages 630-640, June.
    13. Raffaele Paci & Emanuela Marrocu & Stefano Usai, 2014. "The Complementary Effects of Proximity Dimensions on Knowledge Spillovers," Spatial Economic Analysis, Taylor & Francis Journals, vol. 9(1), pages 9-30, March.
    14. Rune Dahl Fitjar & Andrés Rodríguez-Pose, 2014. "When local interaction does not suffice: sources of firm innovation in urban Norway," Chapters, in: André Torre & Frédéric Wallet (ed.), Regional Development and Proximity Relations, chapter 5, pages 195-222, Edward Elgar Publishing.
    15. Roberto P. Camagni, 1995. "The Concept Of Innovative Milieu And Its Relevance For Public Policies In European Lagging Regions," Papers in Regional Science, Wiley Blackwell, vol. 74(4), pages 317-340, October.
    16. Stefano Breschi & Francesco Lissoni, 2001. "articles: Localised knowledge spillovers vs. innovative milieux: Knowledge "tacitness" reconsidered," Papers in Regional Science, Springer;Regional Science Association International, vol. 80(3), pages 255-273.
    17. David B. Audretsch & Dirk Dohse, 2007. "Location: A Neglected Determinant of Firm Growth," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 143(1), pages 79-107, April.
    18. Cristiano Antonelli & Pier Paolo Patrucco & Francesco Quatraro, 2011. "Productivity Growth and Pecuniary Knowledge Externalities: An Empirical Analysis of Agglomeration Economies in European Regions," Economic Geography, Clark University, vol. 87(1), pages 23-50, January.
    19. Sergio Mariotti & Lucia Piscitello & Stefano Elia, 2010. "Spatial agglomeration of multinational enterprises: the role of information externalities and knowledge spillovers," Journal of Economic Geography, Oxford University Press, vol. 10(4), pages 519-538, July.
    20. Markus Grillitsch & Magnus Nilsson, 2015. "Innovation in peripheral regions: Do collaborations compensate for a lack of local knowledge spillovers?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(1), pages 299-321, January.
    21. Thomas Doring & Jan Schnellenbach, 2006. "What do we know about geographical knowledge spillovers and regional growth?: A survey of the literature," Regional Studies, Taylor & Francis Journals, vol. 40(3), pages 375-395.
    22. Michaela Trippl & Anne Otto, 2009. "How to Turn the Fate of Old Industrial Areas: A Comparison of Cluster-Based Renewal Processes in Styria and the Saarland," Environment and Planning A, , vol. 41(5), pages 1217-1233, May.
    23. Anders Malmberg & Peter Maskell, 2006. "Localized Learning Revisited," Growth and Change, Wiley Blackwell, vol. 37(1), pages 1-18, March.
    24. Rikard H. Eriksson, 2011. "Localized Spillovers and Knowledge Flows: How Does Proximity Influence the Performance of Plants?," Economic Geography, Taylor & Francis Journals, vol. 87(2), pages 127-152, April.
    25. Meric S. Gertler, 2003. "Tacit knowledge and the economic geography of context, or The undefinable tacitness of being (there)," Journal of Economic Geography, Oxford University Press, vol. 3(1), pages 75-99, January.
    26. Fiorenza Belussi & Silvia R. Sedita, 2012. "Industrial Districts as Open Learning Systems: Combining Emergent and Deliberate Knowledge Structures," Regional Studies, Taylor & Francis Journals, vol. 46(2), pages 165-184, April.
    27. Stefano Breschi & Camilla Lenzi, 2013. "Local Buzz Versus Global Pipelines and the Inventive Productivity of US Cities," Advances in Spatial Science, in: Thomas Scherngell (ed.), The Geography of Networks and R&D Collaborations, edition 127, chapter 0, pages 299-315, Springer.
    28. Martin Srholec & Bart Verspagen, 2012. "The Voyage of the Beagle into innovation: explorations on heterogeneity, selection, and sectors," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 21(5), pages 1221-1253, October.
    29. Alessia Sammarra & Lucio Biggiero, 2008. "Heterogeneity and Specificity of Inter‐Firm Knowledge Flows in Innovation Networks," Journal of Management Studies, Wiley Blackwell, vol. 45(4), pages 800-829, June.
    30. Jacobsson, Staffan & Oskarsson, Christer & Philipson, Joakim, 1996. "Indicators of technological activities -- comparing educational, patent and R & D statistics in the case of Sweden," Research Policy, Elsevier, vol. 25(4), pages 573-585, June.
    31. Nilsson, Magnus & Mattes, Jannika, 2015. "The spatiality of trust: Factors influencing the creation of trust and the role of face-to-face contacts," European Management Journal, Elsevier, vol. 33(4), pages 230-244.
    32. Stefano Breschi & Francesco Lissoni, 2009. "Mobility of skilled workers and co-invention networks: an anatomy of localized knowledge flows," Journal of Economic Geography, Oxford University Press, vol. 9(4), pages 439-468, July.
    33. Robert Hassink, 2005. "How to unlock regional economies from path dependency? From learning region to learning cluster," European Planning Studies, Taylor & Francis Journals, vol. 13(4), pages 521-535, June.
    34. Ron Boschma, 2005. "Proximity and Innovation: A Critical Assessment," Regional Studies, Taylor & Francis Journals, vol. 39(1), pages 61-74.
    35. David Doloreux & Richard Shearmur, 2012. "Collaboration, information and the geography of innovation in knowledge intensive business services," Journal of Economic Geography, Oxford University Press, vol. 12(1), pages 79-105, January.
    36. Todtling, Franz & Trippl, Michaela, 2005. "One size fits all?: Towards a differentiated regional innovation policy approach," Research Policy, Elsevier, vol. 34(8), pages 1203-1219, October.
    37. Rikard Eriksson & Urban Lindgren, 2009. "Localized mobility clusters: impacts of labour market externalities on firm performance," Journal of Economic Geography, Oxford University Press, vol. 9(1), pages 33-53, January.
    38. Philip Cooke & Loet Leydesdorff, 2006. "Regional Development in the Knowledge-Based Economy: The Construction of Advantage," The Journal of Technology Transfer, Springer, vol. 31(1), pages 5-15, January.
    39. Christoph Alsleben, 2005. "The Downside of Knowledge Spillovers: An Explanation for the Dispersion of High-tech Industries," Journal of Economics, Springer, vol. 84(3), pages 217-248, May.
    40. Anders Malmberg & Dominic Power, 2005. "(How) Do (Firms in) Clusters Create Knowledge?," Industry and Innovation, Taylor & Francis Journals, vol. 12(4), pages 409-431.
    41. Rikard H. Eriksson, 2011. "Localized Spillovers and Knowledge Flows: How Does Proximity Influence the Performance of Plants?," Economic Geography, Clark University, vol. 87(2), pages 127-152, April.
    42. Robert Hassink & Claudia Klaerding, 2012. "The End of the Learning Region as We Knew It; Towards Learning in Space," Regional Studies, Taylor & Francis Journals, vol. 46(8), pages 1055-1066, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Grillitsch, Markus & Trippl, Michaela, 2016. "Innovation Policies and New Regional Growth Paths: A place-based system failure framework," Papers in Innovation Studies 2016/26, Lund University, CIRCLE - Centre for Innovation Research.
    2. Speldekamp, Daniël & Knoben, Joris & Saka-Helmhout, Ayse, 2020. "Clusters and firm-level innovation: A configurational analysis of agglomeration, network and institutional advantages in European aerospace," Research Policy, Elsevier, vol. 49(3).
    3. He, Qiuqin & Guijarro-Garcia, Maria & Costa-Climent, Juan, 2022. "Impact of knowledge-based capital on firm productivity: The contingent effect of ownership," Journal of Business Research, Elsevier, vol. 140(C), pages 85-94.
    4. Andrew Inkpen & Dana Minbaeva & Eric W K Tsang, 2019. "Unintentional, unavoidable, and beneficial knowledge leakage from the multinational enterprise," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(2), pages 250-260, March.
    5. Alex J. Guerrero & Joost Heijs & Elena Huergo, 2023. "The effect of technological relatedness on firm sales evolution through external knowledge sourcing," The Journal of Technology Transfer, Springer, vol. 48(2), pages 476-514, April.
    6. Jakob Eder & Michaela Trippl, 2019. "Innovation in the periphery: compensation and exploitation strategies," PEGIS geo-disc-2019_07, Institute for Economic Geography and GIScience, Department of Socioeconomics, Vienna University of Economics and Business.
    7. Francesco Quatraro & Stefano Usai, 2017. "Knowledge flows, externalities and innovation networks," Regional Studies, Taylor & Francis Journals, vol. 51(8), pages 1133-1137, August.
    8. Pieter E. Stek, 2020. "Mapping high R&D city-regions worldwide: a patent heat map approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 54(1), pages 279-296, February.
    9. Anne Margarian & Cécile Détang-Dessendre & Aleksandra Barczak & Corinne Tanguy, 2022. "Endogenous rural dynamics: an analysis of labour markets, human resource practices and firm performance," SN Business & Economics, Springer, vol. 2(8), pages 1-33, August.
    10. Pindado, Emilio & Sánchez, Mercedes & García Martínez, Marian, 2023. "Entrepreneurial innovativeness: When too little or too much agglomeration hurts," Research Policy, Elsevier, vol. 52(1).
    11. Erik E. Lehmann & Matthias Menter & Katharine Wirsching, 2022. "University spillovers, absorptive capacities, and firm performance," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(1), pages 125-150, March.
    12. Vasilios Kanellopoulos & Georgios Fotopoulos, 2019. "The effect of knowledge spillovers on regional new firm formation: The Greek manufacturing case," Environment and Planning A, , vol. 51(4), pages 1005-1030, June.
    13. Denise R. Dunlap & Roberto S. Santos, 2021. "Storming the Beachhead: An Examination of Developed and Emerging Market Multinational Strategic Location Decisions in the U.S," JRFM, MDPI, vol. 14(7), pages 1-15, July.
    14. Guo, Di & Jiang, Kun & Xu, Chenggang & Yang, Xiyi, 2023. "Geographic clusters, regional productivity and resource reallocation across firms: Evidence from China," Research Policy, Elsevier, vol. 52(2).
    15. Tojeiro-Rivero, Damián & Moreno, Rosina, 2019. "Technological cooperation, R&D outsourcing, and innovation performance at the firm level: The role of the regional context," Research Policy, Elsevier, vol. 48(7), pages 1798-1808.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Markus Grillitsch & Magnus Nilsson, 2019. "Knowledge externalities and firm heterogeneity: Effects on high and low growth firms," Papers in Regional Science, Wiley Blackwell, vol. 98(1), pages 93-114, February.
    2. Robert Huggins & Piers Thompson, 2015. "Entrepreneurship, innovation and regional growth: a network theory," Small Business Economics, Springer, vol. 45(1), pages 103-128, June.
    3. Grillitsch, Markus & Nilsson , Magnus, 2013. "Technological competencies and firm performance: Analyzing the importance of internal and external competencies," Papers in Innovation Studies 2013/24, Lund University, CIRCLE - Centre for Innovation Research.
    4. Grillitsch, Markus, 2014. "Institutional Change and Economic Evolution in Regions," Papers in Innovation Studies 2014/1, Lund University, CIRCLE - Centre for Innovation Research.
    5. Markus Grillitsch, 2014. "Regional Transformation: Institutional Change and Economic Evolution in Regions," ERSA conference papers ersa14p1481, European Regional Science Association.
    6. Martin, Roman & Wiig Aslesen, Heidi & Grillitsch, Markus & Herstad, Sverre, 2017. "Regional Innovation Systems and Global Flows of Knowledge," Papers in Innovation Studies 2017/7, Lund University, CIRCLE - Centre for Innovation Research.
    7. Björn T. Asheim & Markus Grillitsch & Michaela Trippl, 2016. "Regional innovation systems: past – present – future," Chapters, in: Richard Shearmu & Christophe Carrincazeaux & David Doloreux (ed.), Handbook on the Geographies of Innovation, chapter 2, pages 45-62, Edward Elgar Publishing.
    8. Markus Grillitsch & Magnus Nilsson, 2015. "Innovation in peripheral regions: Do collaborations compensate for a lack of local knowledge spillovers?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(1), pages 299-321, January.
    9. Franz Tödtling & Markus Grillitsch, 2015. "Does Combinatorial Knowledge Lead to a Better Innovation Performance of Firms?," European Planning Studies, Taylor & Francis Journals, vol. 23(9), pages 1741-1758, September.
    10. Rodríguez-Pose, Andrés & Eriksson, Rikard, 2017. "Job-related Mobility and Plant Performance in Sweden," CEPR Discussion Papers 12018, C.E.P.R. Discussion Papers.
    11. Qin, Xionghe & Wang, Xueli & Kwan, Mei-Po, 2023. "The contrasting effects of interregional networks and local agglomeration on R&D productivity in Chinese provinces: Insights from an empirical spatial Durbin model," Technological Forecasting and Social Change, Elsevier, vol. 193(C).
    12. De Noni, Ivan & Orsi, Luigi & Belussi, Fiorenza, 2018. "The role of collaborative networks in supporting the innovation performances of lagging-behind European regions," Research Policy, Elsevier, vol. 47(1), pages 1-13.
    13. Rosina Moreno & Ernest Miguélez, 2012. "A Relational Approach To The Geography Of Innovation: A Typology Of Regions," Journal of Economic Surveys, Wiley Blackwell, vol. 26(3), pages 492-516, July.
    14. Duschl, Matthias & Schimke, Antje & Brenner, Thomas & Luxen, Dennis, 2011. "Firm growth and the spatial impact of geolocated external factors: Empirical evidence for German manufacturing firms," Working Paper Series in Economics 36, Karlsruhe Institute of Technology (KIT), Department of Economics and Management.
    15. Jakob Eder & Michaela Trippl, 2019. "Innovation in the periphery: compensation and exploitation strategies," PEGIS geo-disc-2019_07, Institute for Economic Geography and GIScience, Department of Socioeconomics, Vienna University of Economics and Business.
    16. Ron Boschma & Riccardo Cappelli & Anet Weterings, 2017. "Labour mobility, skill-relatedness and plant survival over the industry life cycle: Evidence from new Dutch plants," Papers in Evolutionary Economic Geography (PEEG) 1731, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Dec 2017.
    17. Balázs Lengyel & Rikard H. Eriksson, 2017. "Co-worker networks, labour mobility and productivity growth in regions," Journal of Economic Geography, Oxford University Press, vol. 17(3), pages 635-660.
    18. Rune Dahl Fitjar & Andrés Rodríguez-Pose, 2017. "Nothing is in the Air," Growth and Change, Wiley Blackwell, vol. 48(1), pages 22-39, March.
    19. Bram Timmermans & Ron Boschma, 2014. "The effect of intra- and inter-regional labour mobility on plant performance in Denmark: the significance of related labour inflows," Journal of Economic Geography, Oxford University Press, vol. 14(2), pages 289-311.
    20. Andrea Caragliu & Peter Nijkamp, 2020. "Cognitive Capital and Islands of Innovation: The Lucas Growth Model from a Regional Perspective," Regional Studies, Taylor & Francis Journals, vol. 48(4), pages 624-645, July.

    More about this item

    Keywords

    periphery; firm performance; spillovers; agglomeration;
    All these keywords.

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    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:lucirc:2015_040. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Torben Schubert (email available below). General contact details of provider: https://edirc.repec.org/data/circlse.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.