Theoretical perspectives on localised knowledge spillovers and agglomeration

Samuli Leppälä

There is substantial empirical evidence that innovation is geographically concentrated. Unlike what is generally assumed, however, it is not clear that localised knowledge spillovers provide a theoretically valid explanation for this. Studying spillovers of cost-reducing technology between Cournot oligopolists we show that 1) localised knowledge spillovers of any level do encourage agglomeration, but 2) whether this leads to higher levels of effective R&D depends on the type and level of knowledge spillovers, the number of firms, and the industry's R&D efficiency.

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Year of publication:	2014
Authors:	Leppälä, Samuli
Publisher:	Cardiff : Cardiff Univ, Cardiff Business School, Economics Section
Subject:	knowledge spillovers \| agglomeration economies \| innovation \| location \| Wissenstransfer \| Knowledge transfer \| Agglomerationseffekt \| Agglomeration effect \| Spillover-Effekt \| Spillover effect \| Innovation \| Theorie \| Theory \| Regionales Cluster \| Regional cluster \| Neue ökonomische Geographie \| New economic geography \| Betriebliche Standortwahl \| Firm location choice