Knowledge spillovers and local innovation systems: a critical survey

The paper re-examines critically the growing literature on localised knowledge spillovers (LKSs), and finds the econometric evidence on the subject still lacking of a firm theoretical background, especially in respect of the more recent developments in the economics of knowledge. Therefore such evidence, and even more the concept itself of LKS, should not be read as supportive of new industrial geographers' work on industrial districts, hi-tech agglomerations and 'milieux innovateur'. On the contrary, it may represent a threat to the necessary efforts for gaining more theoretical rigour and getting more empirical fieldwork done. Key words: knowledge, innovation, spillovers, externalities, regional agglomeration. JEL classification: D62, O30, R12