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Firms’ knowledge search and local knowledge externalities in innovation performance

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Roper, Stephen, Love, James H. and Bonner, Karen (2017) Firms’ knowledge search and local knowledge externalities in innovation performance. Research Policy, 46 (1). pp. 43-56. doi:10.1016/j.respol.2016.10.004 ISSN 0048-7333.

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Official URL: http://dx.doi.org/10.1016/j.respol.2016.10.004

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Abstract

We use an augmented version of the UK Innovation Surveys 4–7 to explore firm-level and local area openness externalities on firms’ innovation performance. We find strong evidence of the value of external knowledge acquisition both through interactive collaboration and non-interactive contacts such as demonstration effects, copying or reverse engineering. Levels of knowledge search activity remain well below the private optimum, however, due perhaps to informational market failures. We also find strong positive externalities of openness resulting from the intensity of local interactive knowledge search—a knowledge diffusion effect. However, there are strong negative externalities resulting from the intensity of local non-interactive knowledge search—a competition effect. Our results provide support for local initiatives to support innovation partnering and counter illegal copying or counterfeiting. We find no significant relationship between either local labour quality or employment composition and innovative outputs.

Item Type: Journal Article
Subjects: H Social Sciences > HD Industries. Land use. Labor
Divisions: Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH): Business enterprises -- Technological innovations, Small business
Journal or Publication Title: Research Policy
Publisher: Elsevier BV
ISSN: 0048-7333
Official Date: February 2017
Dates:
DateEvent
February 2017Published
29 October 2016Available
17 October 2016Accepted
2 February 2016Submitted
Volume: 46
Number: 1
Page Range: pp. 43-56
DOI: 10.1016/j.respol.2016.10.004
Status: Peer Reviewed
Publication Status: Published
Access rights to Published version: Open Access (Creative Commons)
Date of first compliant deposit: 31 October 2016
Date of first compliant Open Access: 1 November 2016

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