KTH/CESIS Working Paper Series in Economics and Institutions of Innovation
Spin-offs: Why geography matters
(), Pontus Braunerhjelm
() and Ioannis Tikoudis
Abstract: Based on unique data covering individuals, firms,
industries, and regions for the 1999-2005 period, we contribute with new
knowledge concerning the impact of regional variables on spin-offs.
Implementing a large number of controls, as well as different estimation
techniques and robustness tests, we show that Jacobian externalities have a
positive effect on spin-offs. Moreover, using an entropy measure to
disentangle unrelated and related variety, we conclude that the effect is
confined to related variety. These findings are likely to be associated
with strong welfare effects: a standard-deviation increase (decrease) in
related (unrelated) variety increases spin-off propensity by approximately
25%. Other variables are shown to have economic effects of a similar
magnitude but may have a different effect across sectors. Sensitivity
analyses indicate that the impact of other determinants proposed in the
literature (e.g., Marshallian externalities and scale effects) is too small
to be detected.
Keywords: Regions; spin-offs; industries; (follow links to similar papers)
JEL-Codes: D01; L26; R10; (follow links to similar papers)
41 pages, December 22, 2014
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- This paper is published as:
Baltzopoulos, Apostolos, Pontus Braunerhjelm and Ioannis Tikoudis, (2015), 'Spin-offs: Why geography matters', Journal of Economic Geography
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