R&D spillovers and productivity: an analysis of geographical and technological dimensions

This analysis examines whether potential spillover pools for R&D based on technological and/or geographical proximity have a positive impact on firm productivity for Danish firms, and the importance of absorptive capacity for spillover effects. Knowledge spillovers are constructed based on the research profiles of businesses. The article finds that measures of R&D spillovers based on technological proximity impact positively on firms' productivity, while results are much weaker for geographical measures. In general, the impact of spillovers is increasing in the share of R&D personnel, indicating the importance of absorptive capacity for benefitting from private knowledge pools on a broader scale. The geographical dimension of spillovers also shows some importance when considered together with the share of R&D personnel.