Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

Abstract: Recent literature on firm innovation emphasize the importance of combinations of different knowledge sources in innovation processes. Moreover, the literature on firm collaboration has evolved stepwise: (1) knowledge networks tend to be geographically bounded, and (2) proximity in other dimensions than physical distance, such as cognitive and organisational proximity, may influence the evolution and influences of networks. The results from this empirical study support these ideas by indicating that firms’ probability to innovate is enhanced when they collaborate. However, not all types of collaborations are as important. By using data from a survey on innovation and collaboration of 636 firms in the county of Jönköping, Sweden, we find that extra-regional collaboration matters the most for the innovation performance of these firms. Moreover, collaborations tend to be most favourable for innovation when the collaborators involved has some organisational or cognitive proximity. Collaborations that imply vertical linkages in the value added chain appear to more important than horizontal linkages.

Keywords: Innovation; innovation networks; innovation survey; proximity; firm collaboration

JEL-codes: C83; O31; R10

24 pages, November 7, 2014

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