The Complementary Effects of Proximity Dimensions on Knowledge Spillovers

The purpose of this paper is to analyze the effect of various proximity dimensions on the innovative capacity of 276 regions in Europe within a knowledge production function model, where R&D and human capital are included as the main internal inputs. We combine the standard geographical proximity with the institutional, technological, social and organizational ones to assess whether these externalities are substitutes or complements in channeling knowledge spillovers. Results show that all proximities have a significant complementary role in generating an important flow of knowledge across regions, with the technological closeness playing the most relevant role