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This book offers a geographic dimension to the study of innovation and product commercialization. Building on the literature in economics and geography, this book demonstrates that product innovation clusters spatially in regions which provide concentrations of the knowledge needed for the commercialization process. The book develops a conceptual model which links the location of new product innovations to the sources of these knowledge inputs. The geographic concentration of this knowledge fonns a technological infrastructure which promotes infonnation transfers, and lowers the risks and the costs of engaging in innovative activity. Empirical estimation confinns that the location of product innovation is related to the underlying technological infrastructure, and that the location of the knowledge inputs are mutually reinforcing in defining a region's competitive advantage. The book concludes by considering the policy implications of these fmdings for both private finns and state governments. This work is intended for academics, policy practitioners and students in the fields of innovation and technological change, geography and regional science, and economic development. This work is part of a larger research effort to understand why the location of innovative activity varies spatially, specifically the externalities and increasing returns which accrue to location. xi Acknowledgements This work has benefitted greatly from discussions with friends and colleagues. I wish to specifically note the contribution of Mark Kamlet, Wes Cohen, Richard Florida, Zoltan Acs and David Audretsch. I would like to thank Gail Cohen Shaivitz for her dedication in editing the final manuscript.
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THE GEOGRAPHY OF INNOVATION Economics of Science, Technology and Innovation VOLUME 2 Series Editors Cristiano Antonelli, University of Torino, Italy Bo Carlsson, Case Western Reserve University, U.S.A. Editorial Board Steven Klepper, Carnegie Mellon University, U.S.A. Richard Langlois, University of Connecticut, U.S.A. J. S. Metcalfe, University of Manchester, U.K. David Mowery, University of California, Berkeley, U.S.A. Pascal Petit, CEPREMAP, France Luc Soete, University of Limburg, The Netherlands The titles published in this series are listed at the end of this volume. THE GEOGRAPHY OF INNOVATION by MARYANN P. FELDMAN Department of Economics, Goucher College, Baltimore, Maryland SPRINGER-SCIENCE+BUSINESS MEDIA, B.V. A C.I.P. Catalogue record for this book is available from the Library of Congress. ISBN 978-90-481-4363-4 ISBN 978-94-017-3333-5 (eBook) DOI 10.1007/978-94-017-3333-5 Printed on acid-free paper All Rights Reserved © 1994 Springer Science+Business Media Dordrecht Originally published by Kluwer Academic Publishers in 1994 No part of the material protected by this copyright notice may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage and retrieval system, without written permission from the copyright owner. to the memory of my mother Contents Preface xi Acknowledgements xii Chapter 1 Introduction Chapter 2 1 Why Location Matters to Innovative Activity 13 Chapter 3 Spatial Patterns of Innovation 29 Chapter 4 Technological Infrastructure 51 Chapter 5 Regional Innovative Capacity 77 Chapter 6 Innovation Policy 93 Appendix 113 Bibliography 129 Index 151 vii The Geography of Innovation viii List of Tables and Figures Tables Table 3-1: Correlation Matrix for Measures of Innovative 31