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Does Inter-Organizational Networking Support Regional Development? Evidence from a Survey of Finnish Enterprises

Author

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  • Pajarinen, Mika
  • Rouvinen, Petri

Abstract

Three fourths of Finnish business enterprises have relationships that are deeper than those associated with normal market transactions, i.e., they are involved in inter-organizational networking. Regionally networking is more commonplace in North Savo, North Karelia/Kainuu, Central Finland and Lapland/Northern Ostrobothnia. Connections to other firms is the most prevalent and qualitatively most important type of networking. Net-working is predominantly a local phenomenon, particularly when it comes to firms partner-ships with educational and research institutions as well as public bodies. Networking may be associated with better firm profitability in low-tech industries. Participating in a national cluster may be associated with firms better growth prospects. In the absence of functioning local markets for some productive inputs, being engaged in inter-organizational networking may be a necessary conditions for firms survival.

Suggested Citation

  • Pajarinen, Mika & Rouvinen, Petri, 2008. "Does Inter-Organizational Networking Support Regional Development? Evidence from a Survey of Finnish Enterprises," Discussion Papers 1157, The Research Institute of the Finnish Economy.
  • Handle: RePEc:rif:dpaper:1157
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    Keywords

    Inter-organizational networking; business collaboration; profitability; growth;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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