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Localized Product Innovation. The Role of Proximity in the Lancastrian Product Space

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The introduction of technological innovations is induced by changes in product and factor markets to which firms cannot adjust by means of changes in a given technical space, because of limited information, localized knowledge and irreversibility of tangible and intangible production factors. Firms can counteract the decline in their performance and the increase in actual costs by changing their technologies, with the introduction of process and product innovations Proximity in the Lancastrian product space matters when relevant knowledge is acquired and localized by learning by doing current products, learning by using the techniques in place and learning by interacting with current customers and rivals. The rate of technological change and the mix between product and process innovations are endogenous and localized by the key role of irreversibility and by the competence accumulated by means of learning processes.

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  • Antonelli, Cristiano, 2003. "Localized Product Innovation. The Role of Proximity in the Lancastrian Product Space," 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 200304, University of Turin.
    • Handle: RePEc:uto:labeco:200304
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    1. Grazia Cecere, 2012. "Economics of soft innovation: a review article," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 21(8), pages 827-835, November.
    2. D’Ignazio, Alessio & Giovannetti, Emanuele, 2014. "Continental differences in the clusters of integration: Empirical evidence from the digital commodities global supply chain networks," International Journal of Production Economics, Elsevier, vol. 147(PB), pages 486-497.

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