New technology in the region - agglomeration and absorptive capacity effects on laser technology research in West Germany, 1960-2005

We analyze the spatial diffusion of laser technology research in West Germany from 1960, when this technology began, until 2005. Early adoption of laser technology research was especially prevalent in large agglomerations. While we cannot detect knowledge spillovers from adjacent regions, geographic proximity to the center of initial laser research was conducive to early adoption of laser research; however, the effect is negligibly small. The earlier a region embarked on this type of research, the higher the level of laser research later, indicating the accumulation of knowledge generated in previous periods. Our results highlight the role of a region's absorptive capacity for commencing and conducting research in a new technological field. An interregional transfer of tacit knowledge was largely unimportant for the spatial diffusion of research in this technological field.