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CIRCLE, Center for Innovation, Research and Competences in the Learning Economy, Lund University Papers in Innovation Studies, CIRCLE, Center for Innovation, Research and Competences in the Learning Economy, Lund University

No 2014/33:
Innovation in peripheral regions: Do collaborations compensate for a lack of local knowledge spillovers?

Markus Grillitsch () and Magnus Nilsson ()

Abstract: It is widely accepted that firms in peripheral regions benefit to a lesser extent from local knowledge spillovers than firms located in agglomerations or industrial clusters. This paper investigates the extent to which innovative firms in peripheral regions compensate for the lack of access to local knowledge spillovers by collaborating at other geographical scales. So far the literature predominantly suggests that collaborations complement rather than compensate for local knowledge spillovers. Using data on the collaboration patterns of innovative firms in Sweden, this paper provides evidence that firms with low access to local knowledge spillovers tend to collaborate more. This effect, however, depends on firm size and in-house capabilities. Our findings suggest that firms with strong in-house capabilities do indeed compensate for a lack of local knowledge spillovers with collaborations while firms with weaker in-house capabilities depend more on the regional knowledge infrastructure.

Keywords: Local knowledge spillovers; periphery; collaboration; innovation; geography; Sweden; (follow links to similar papers)

JEL-Codes: O18; O30; O31; P48; R10; R11; (follow links to similar papers)

23 pages, December 25, 2014

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