KTH/CESIS Working Paper Series in Economics and Institutions of Innovation
Firm Knowledge, Neighborhood Diversity and Innovation
Abstract: This paper tests the importance of firm level knowledge
and neighborhood diversity, as a source for localized knowledge spillovers,
on firms propensity to innovate. Diversity is measured in terms of
industries as well as employee education and occupation, of which the
results show a positive neighborhood effect from diversity in education. In
addition, an added positive effect from neighborhood diversity in education
is found for firms with a larger share of highly educated employees, which
points to the importance of absorptive capacity. However, firm
characteristics, such as the knowledge of the own employees, provide to be
the strongest determinants for the innovativeness of firms.
Keywords: Knowledge; neighborhood diversity; education; skills; innovation; (follow links to similar papers)
JEL-Codes: J21; J24; O31; R32; (follow links to similar papers)
34 pages, April 3, 2014
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