Company-Scientist Locational Links : The Case of Biotechnology

In recent years, the significance of geography among firms has declined due to the introduction of electronic methods of communication. However, with the increasing presence of the biotechnology industry, with its affiliated university-based scientists, the issue of geography is proposed as a significant issue for consideration. Most notably, researchers cite that the role of the scientist within the firm impacts the geographic proximity between the firm and the scientist. The types of links between scientists and firms are examined, drawing on a database of biotech firms that have issued IPOs. The data analyses indicate that firm proximity is often influenced not only by the scientist's role in the firm, but also by his or her status in the scientific community and by his or her age. Although past studies have cited the relationship between informal knowledge spillovers and proximity, the current research suggests that geographic proximity plays a less significant role when knowledge is transmitted through formal ties between scientists and corporations. Areas of future research are identified, including the impact of factors such as the proximity of other firm locations and research institutions, and how the role of geography differs between regions. (AKP)