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Does Proximity Matter for Knowledge Transfer from Public Institutes and Universities to Firms?




'National Innovation Systems' theories are built upon the assumption that linkages among organisations matter to innovation. Specifically, proximity is a crucial factor in most of the explanations of regional innovation systems. Yet several thing, such as the rapid growth of the internet and email, suggest that the role of proximity could be breaking down, particularly for large firms with the financial resources to seek out knowledge anywhere in the world.However, the need to access tacit knowledge in rapidly evolving science-based technologies could counter the centrifugal features of modern communication technologies. This study examines the effect of proximity on the sourcing of knowledge by firms from suppliers, customers, joint ventures, competitors (via reverse engineering) and publicly-funded research organisations (PROs). The focus is on PROs, since they are an essential component of National Innovation Systems. Relevant data for up to 615 firms are available from the 1993 PACE survey of Europe's largest industrial firms. Descriptive results show that compared to four other information sources proximity effects are greatest for PROs. The factors that influence the importance of proximity to the use of information from PROs are explored through an ordered logit model. The dependent variable is the relative importance of domestic and foreign PROs. The independent variables include firm size, activity in foreign markets, R&D intensity, a proxy for codified knowledge, and two proxies for the quantity and quality of the scientific base of a country. The ordered logit model results show that proximity effects decline with an increase in the firm's R&D expenditures, the importance attached to basic research results in publications, and activity in the North American market, but increase with the quality and availability of outputs from domestic PROs.

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  • Anthony Arundel & Aldo Geuna, 2001. "Does Proximity Matter for Knowledge Transfer from Public Institutes and Universities to Firms?," SPRU Working Paper Series 73, SPRU - Science and Technology Policy Research, University of Sussex.
  • Handle: RePEc:sru:ssewps:73

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    References listed on IDEAS

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    Cited by:

    1. Nour, Samia Satti O. M., 2005. "Science and Technology Development Indicators in the Arab Region: A Comparative Study of Gulf and Mediterranean Arab Countries," UNU-INTECH Discussion Paper Series 03, United Nations University - INTECH.
    2. Samia Nour, 2014. "The Importance (Impacts) of Knowledge at the Macro–Micro Levels in the Arab Gulf Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 5(3), pages 521-537, September.
    3. Keld Laursen & Ammon Salter, 2005. "The fruits of intellectual production: economic and scientific specialisation among OECD countries," Cambridge Journal of Economics, Oxford University Press, vol. 29(2), pages 289-308, March.
    4. Narula, Rajneesh, 2004. "Understanding absorptive capacities in an "innovation systems" context: consequences for economic and employment growth," Research Memorandum 004, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    5. Keld Laursen & Ammon Salter, 2003. "Searching Low and High What Types of Firms use Universities as a Source of Innovation?," DRUID Working Papers 03-16, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    6. Gonzalez-Brambila, Claudia & Veloso, Francisco M., 2007. "The determinants of research output and impact: A study of Mexican researchers," Research Policy, Elsevier, vol. 36(7), pages 1035-1051, September.
    7. Basant, Rakesh, 2002. "Knowledge Flows and IndustrialClusters: An Analytical Review of Literature," IIMA Working Papers WP2002-02-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    8. Nour, Samia, 2011. "The importance (impact) of knowledge at the macro-micro levels in Sudan," MERIT Working Papers 034, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    9. Margherita Balconi & Stefano Breschi & Francesco Lissoni, 2002. "Networks of Inventors and the Location of University Research: An Exploration of Italian Data," KITeS Working Papers 127, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised May 2002.
    10. Nour, Samia Satti Osman Mohamed, 2013. "The importance and impacts of knowledge at the macro-micro levels in the Arab Gulf countries," MERIT Working Papers 016, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    11. Guerzoni, Marco & Aldridge, Taylor & Audretsch, David B & Sameeksha, Desai, 2012. "University Knowledge, Originality of Patents and the Creation of New Industries," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201219, University of Turin.
    12. Basant, Rakesh & Chandra, Pankaj, 2007. "Role of Educational and R&D Institutions in City Clusters: An Exploratory Study of Bangalore and Pune Regions in India," World Development, Elsevier, vol. 35(6), pages 1037-1055, June.
    13. Figueiredo, Paulo N. & Vedovello, Conceição, 2005. "Firms’ Creative Capabilities, the Supporting Innovation System and Globalization in Southern Latin America: A Bleak Technological Outlook or a Myopic Standpoint? Evidence from a Developing Region in B," UNU-INTECH Discussion Paper Series 04, United Nations University - INTECH.
    14. Joana Costa & Aurora A. C. Teixeira, 2005. "Universities as sources of knowledge for innovation.The case of Technology Intensive Firms in Portugal," FEP Working Papers 181, Universidade do Porto, Faculdade de Economia do Porto.
    15. Muscio, Alessandro & Quaglione, Davide & Scarpinato, Michele, 2012. "The effects of universities' proximity to industrial districts on university–industry collaboration," China Economic Review, Elsevier, vol. 23(3), pages 639-650.

    More about this item


    Public research; localisation; knowledge flows; knowledge spillovers; process of innovation.;

    JEL classification:

    • H4 - Public Economics - - Publicly Provided Goods
    • L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights


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