Firm Heterogeneity in Biotech: Absorptive Capacity,Strategies and Local-Regional Connections

This paper focuses on the characteristics of biotech firms with various levels of research and development (R&D) activity. It is done by exploring the relationship between R&D intensity, alliances and the extent of regionalization of firms' activities using evidence from a survey of US-based biotechnology firms. We profile two firm prototypes: research-oriented firms and product-oriented firms, focusing on their characteristics, strategies and operations. These include activities devoted to exploration and exploitation through alliances with universities (more exploration) and with pharmaceutical companies (exploration and exploitation), and locational needs which facilitate both exploration and exploitation.     

Strategic Considerations for Innovation and Commercialization in the US Biotechnology Sector

This paper examines the importance of alliances as an innovation strategy utilized by US biotechnology firms. In doing so, the role of alliances with universities vis-à-vis alliances with industrial companies is emphasized. The biotechnology sector is dominated by few large and many small firms. The small firms are research focused or technology developers. Several large firms are now integrated biopharmaceutical companies. Very few small firms can survive without strengthening their relationships with universities, biotechnology or pharmaceutical or other large companies. These relationships range from licensing agreements, export–import connections to various forms of alliances for R&D, product development and marketing. Large firms supplement in-house R&D by acquiring research products and/or new technologies from small firms as well as universities. A survey of US biotechnology companies is used to show the emergence of alliance relationships, which continue to highlight university linkages, emphasize connections of biotechnology firms with other biotechnology entrepreneurs, and an ongoing effort to build a synergistic relationship with pharmaceutical or other large companies. Most linkages are not confined to the local area; the main locational attribute is the science base or the labour market.     

Examining the Role of Geographical Proximity in a Cluster's Transformation Process: The Case of Taiwan's Machine Tool Industry

This paper examines the relationship between geographical proximity and a cluster's sustained dynamism with a specific focus on the role of geographical proximity in the transformation of cluster firms' production and learning organizations. Using Taiwan's machine tool cluster as an empirical case, this article studies the nature of various intra- and extra-cluster technological networks established by local firms to tackle the cluster's developmental inertia. In contrast to most recent studies that seem to consider geographical proximity less relevant to the sustained prosperity of incumbent clusters, our case study finds that geographical proximity continues to be a critical factor underlying agglomerated firms' capacity to maintain and explore diverse capabilities within and outside the clusters. On the one hand, co-location allows these firms and their coupled actors to experiment with a range of technological networks and organizational forms in the face of the changing competitive conditions. On the other hand, while the spatial boundaries of important technological networks in the cluster are not necessarily confined to the locality, we find that geographical proximity among networked members is the key to the emergence of and better governing over those crucial extra-cluster networks. In addition to responding to the call for empirical work exploring the relationships between geographical proximity and non-geographical proximity in knowledge creation and exchange, this article contributes to the cluster literature by providing evidence on the evolution of clusters and whether the advantages associated with geographical clustering persist over time.     

Labour Relations and the Transfer of Knowledge in Industrial Clusters: Why do Skilled Workers Share Knowledge with Colleagues in Other Firms?

Industrial clusters are held to offer competitive advantages to firms that accrue from the transfer of tacit knowledge between skilled workers co-located in spatially bound regions. This paper argues that informal knowledge transfers between skilled employees working in spatially bounded industrial clusters might have an association with the labour relationship between employers and employees. In the literature on industrial clusters general knowledge is readily traded through codified texts and collegial networks but high value, tacit knowledge transfers occur less frequently but are critical to the success of firms located in clusters. Tacit knowledge transfers are held to occur when workers move to other firms because of firm death or poaching but less frequently through contacts between colleagues from other firms. Industrial clusters are said to offer labour market advantages for skilled workers in the form of ample job opportunities and rising wages, which engender firm loyalty and discourage the transfer of tacit knowledge of competitive value to other firms. However, the limited empirical evidence available on actual working conditions for skilled workers in regional industrial clusters indicates that this argument is contestable. Some evidence suggests that there are limited wage premiums accruing to the industrial districts, a limited role for geographic proximity, and weak localised returns on seniority and education. We argue that in such circumstances high value knowledge between workers in different firms might be traded as an act of epistemic solidarity or sociability that disregards the interests of employer organisations. Such actions might vary by region and country in relation to the prevailing system of labour relations. Australian labour relations are offered as a case in point.     

Does Combinatorial Knowledge Lead to a Better Innovation Performance of Firms?

The knowledge base concept in the past was often applied in its “pure form”, i.e. it was assumed that there are dominant knowledge bases in particular sectors and firms shaping knowledge and innovation processes and related networks. For “analytical sectors” such as biotech, it has been argued that codified knowledge generated by universities and R&D organizations is the key for innovation, whereas “synthetic sectors” such as machinery innovate more incrementally by recombining existing knowledge often drawn from suppliers or service firms. Empirical literature has partly confirmed these patters, but also shown more complex knowledge processes. More recently it has been argued that combinations of different knowledge bases might enhance the innovation performance of firms. For example in “analytical sectors”, firms might benefit not just from new and basic knowledge generated by research, but also from recombining existing and applied knowledge or by drawing on symbolic knowledge. Combinatorial knowledge bases might also be relevant for “synthetic” and “symbolic sectors”, but in different forms. This study investigates for the ICT sector in regions of Austria if the reliance on combinatorial knowledge leads to a better innovation performance than the use of more narrow knowledge bases.     

Complementarities Between Universities and Technology Institutes: New Empirical Lessons and Perspectives

This paper investigates the different roles played by universities and technology institutes (TIs) as innovation partners of firms. Comparing the characteristics of Spanish firms collaborating with these agents allows us to better define complementarities among the target groups of these organizations. Our findings show that those firms collaborating with universities are bigger, have higher internal capabilities and are less dependent on their external relationships while firms collaborating with TIs are smaller, have weaker internal capabilities but are more open to their environment and thus more reliant on external sources. We point to the implications of these findings for regional development. Universities have a role as partners of more technologically advanced firms. TIs, on the other hand, partner those firms, which though also quite advanced, require more external help in their innovation processes. These results should help policy-makers in the definition of more complex regional strategies and the provision of tools aimed at different goals. Managers of universities, TIs and client firms should find these results of help in developing more positive collaborations with one another.     

Interaction among High-tech Talent and its Impact on Innovation Performance: A Comparison of Taiwanese Science Parks at Different Stages of Development

Numerous studies have studied how knowledge spillovers and various other factors influence industrial clusters in terms of geographical proximity. Related studies have generally confirmed significant positive correlations between firm innovative activities and factors such as spatial proximity and degree of industrial clustering. This study elucidates on an individual level, based on the relationship between proximity dimension and innovative activity, the interactive relationships between the mobility and interaction of high-tech talent and innovation performance. Survey results indicate that the spatial proximity of firms clustering within the Hsinchu and Tainan Science-based Industrial Park increases the interaction among high-tech personnel and the expansion of their professional networks, thus promoting innovation. Gradually organizational and social proximity evolve from physical proximity within high-tech districts via the evolution of industrial networks and interactions among high-tech talent. Additionally survey results demonstrate the value of mobility and informal relationships involving high-tech talent, as well as the effect of these relationships on innovation performance during the various stages of science park development. However, how to avoid lock-in in the future development of high-tech districts remains a critical issue. The results of this investigation provide a useful reference for planning and managing industrial districts.     

The Spatial Evolution of the Polish Biotech Industry: A Path-Dependent Process?

In Poland, similarly to other Central and Eastern European countries, the development of the biotech industry dates back to the late 1980s, when the first private companies were established. The political and economic transformation of 1989 enabled mass development of private enterprises, but over the course of 20 years of development, only a couple of dozens biotech firms have emerged in Poland. The spatial evolution of the industry shows a strong concentration in Poland's six largest urban centres, which are characterized by the best scientific base, access to financial capital, and a well-developed local entrepreneurial culture. Given that all biotech clusters are also important centres of the pharmaceutical industry, despite the fact that there are no strong direct relationships between Poland's biotech and pharmaceutical companies, the authors of this paper put forward the thesis that the institutional environment of the pharmaceutical sector also affects the development of the biotech industry.     

Commercializing Science in Europe: The Cambridge Biotechnology Cluster

The article examines the variety of linkages firms have established with university science. These include using universities as a source of ideas for start-ups, scientific collaboration between firms and laboratories, the role of scientists on the scientific advisory boards of firms, and the role of universities in supplying firms with a labour market for talented scientists. These linkages are plentiful across Cambridge area biotechnology firms. However, and perhaps surprisingly, our evidence shows that a key actor, the University of Cambridge does not dominate the scientific linkages of the area's firms. A large percentage of Cambridge's firms do not derive from its university. The majority of scientific collaborations are not with University of Cambridge laboratories, nor do Cambridge scientists dominate the scientific advisory boards of firms. Moreover, the majority of scientists within area biotechnology firms appear not to have left University of Cambridge laboratories to move to industry.     

Delocalization Patterns in University–Industry Interaction: Evidence from the Sixth R&D Framework Programme

Increasing university–industry interaction (UII) and university contribution to the local economy are compatible—conventional wisdom would say. However, similar to other university activities, interaction with industry may be limited due to a lack of absorptive capacity in local firms. The data of those participating in the European Union's (EU's) Sixth R&D Framework Programme (FP6) were used to obtain values for the number and, notably, the budgets of UII projects at the regional level for the EU27. Two types of interactions were considered: inside and outside the region. Our analysis indicates that universities from regions whose firms have low absorptive capacity participate more often in FP6 projects with firms outside the region. Our results highlight the value of policies that facilitate firm R&D to enhance collaboration with regional universities.     

Small Businesses Need Strong Mediators: Mitigating the Disadvantages of Peripheral Localization Through Alliance Formation

This paper investigates how small entrepreneurial firms in two peripheral regions developed by entering the oil and gas industry. The paper draws on previous studies related to the establishment of strategic alliances and emerging clusters and contributes to these research streams by examining the disadvantages of peripheral localization and small firm size. We use a longitudinal case study based on primary data consisting of 54 in-depth interviews conducted between 2007 and 2012 to illustrate that when large-scale oil and gas projects enter a peripheral region, oil companies can moderate local firms' disadvantages related to peripheral localization by actively facilitating relationships with established national firms. By facilitating such relationships and maintaining an active moderating role, strategic alliances and emerging cluster structures can arise. A cross-case analysis illustrates that the oil company had a decisive role in one of the two cases in two dimensions: its role as intermediary between local firms and national firms and its role in fostering the development of an emerging cluster structure by stimulating the establishment of new firms through the oil and gas project. In the second case, the oil company was unable to facilitate regional development.     

Contrasting Resistance and Alliances in the Ethnic State of Napiniaca,Chiapas (Mexico) (1521–1590): The Anthropological and Historical Aspects

The present article aims to re-evaluate the gamut of ostensible alliances forged between colonial subordinates and those who subordinated them in the ethnic state of Napiniaca, Mexico, as well as identify the social spaces and contexts in which such alliances were formed and ultimately fell apart. It will do so by attempting to “unwrap” indigenous strategies and forms of resistance based on the admittedly limited texts we currently possess, in light of modern research and theory in both (ethno) history and anthropology.     

The Geography of Knowledge Spillovers Between High-Technology Firms in Europe: Evidence from a Spatial Interaction Modeling Perspective

The focus in this article is on knowledge spillovers between high-technology firms in Europe, as captured by patent citations. The European coverage is given by patent applications at the European Patent Office that are assigned to high-technology firms located in the EU-25 member states (except Cyprus and Malta), the two accession countries Bulgaria and Romania, and Norway and Switzerland. By following the paper trail left by citations between these high-technology patents we adopt a Poisson spatial interaction modeling perspective to identify and measure spatial separation effects to interregional knowledge spillovers. In doing so we control for technological proximity between the regions, as geographical distance could be just proxying for technological proximity. The study produces prima facie evidence that geography matters. First, geographical distance has a significant impact on knowledge spillovers, and this effect is substantial. Second, national border effects are important and dominate geographical distance effects. Knowledge flows within European countries more easily than across. Not only geography, but also technological proximity matters. Interregional knowledge flows are industry specific and occur most often between regions located close to each other in technological space.     

Proximity and economic activity: An analysis of vendor‐university transactions

This paper uses transaction‐based data to provide new insights into the link between the geographic proximity of businesses and associated economic activity. It develops two new measures of, and a set of stylized facts about, the distances between observed transactions between customers and vendors for a research intensive sector. Spending on research inputs is more likely with businesses physically closer to universities than those further away. Firms supplying a university project in one year are more likely to subsequently open an establishment near that university. Vendors who have supplied a project, are subsequently more likely to be a vendor on the same or related project.     

The Role of Personal Factors in the Location Decision of Software Services Start-up Firms

This paper explores the factors which influence the business location decisions of start-ups, focusing in particular on the role of personal factors. Established explanations of industry location emphasize proximity to firms in the same or related industries and proximity to a wider set of business services, though recent research suggests that personal factors may play an important role in explanations of industry location—particularly in technology-enabled sectors. A survey of 97 new firms, founded between 2008 and 2012, in the Irish software services sector, shows that the business location decision is influenced by the personal motivation of entrepreneurs to attain a desired quality of life, and that this outweighs economic factors such as proximity to firms within the same or related industries, proximity to a broader set of supporting business services, infrastructure or the availability of government support schemes. Personal factors are particularly important to firms located outside the Dublin metropolitan area and to home-based businesses. This has important policy implications for national and regional governments seeking to encourage entrepreneurship in technology-enabled service sectors.     

Digital gravity? Firm birth and relocation patterns of young digital firms in Germany

This paper analyses the spatial patterns of young (<10 years) digital firms in Germany between 2008 and 2017 on county level. Determinants of firm birth locations as well as relocations are considered jointly to understand differences in location choices within firms' life cycles. I match commercial register data of 107,321 firms with county-level administrative data to capture local characteristics. Using an OLS model with fixed effects, I find that the local knowledge base—that is, universities, research institutes, and colocated incumbents—are significant key determinants of digital firm birth when controlling for a host of local characteristics. My results indicate that for five firms per 1000 inhabitants, there is around one firm birth. Second, using a fixed effects gravity model for the analysis of relocations, I find that the most dominant explanatory factor for firm relocation across specifications is distance, that is, relocation costs. Relocation flows are more than twice as high to neighboring counties relative to other locations which shows that digital firms are not as footloose as their business model may suggest. Jointly, my results reflect economic activity's regional persistence, particularly for new firms. My paper provides evidence for policies targeting homogenous digital clusters based on strong colocation and that digital economic activity is not shifted over long distances, but the regional entrepreneurship capital is crucial for local growth.     

Do Manufacturing Firms Profit from Intraregional Innovation Linkages? An Empirical Based Answer

Nowadays, inter-firm linkages in the form of regional networks are seen as growth-promoting and important prerequisites for successful innovation activities in firms. Beginning with this hypothesis, the paper sets out to answer the question, whether manufacturing businesses with strong intraregional ties are more successful with respect to growth rates and innovative activities than those firms with little connection to their region. From a survey carried out in 10 European regions, the results verify that in spite of numerous network relationships on the national and international level small businesses are most likely to cooperate with others in their vicinity. In addition, the more knowledge-intensive innovation activities of businesses are, the more important is the relevance of spatial proximity in particular and networking in general.     

The Economic Geographies of the Outer City: Industrial Dynamics and Imaginary Spaces of Location in Copenhagen

The paper focuses on the changing economic geographies of the outer city of Copenhagen. The outer city is not a well-defined place but can be understood as a set of processes transforming the urban economic landscape outside the built-up area. Several central and interrelated economic processes transform the outer city. The paper examines the changing industrial dynamics and location spaces within the framework of geographical proximity and relation propinquity in order to examine the social and cultural embeddedness of location. Imaginary spaces of location are the social constructs of the firm (of the interviewee representing the firm). They are representations of the perception, experience and interpretation of the location of the firm. The imaginary spaces of firms in the outer city are different from those of the firms in the built-up area, and a survey points to the fact that multiple rationalities are important in order to understand industrial location.     

Why Do Firms Relocate? Lessons from a Regional Analysis

In recent years, the qualitative evolution of relocations (from low-cost offshoring to more technologically intensive relocations) has become a new concern in political debate. Focusing on these new trends, the aim of this paper is to better understand relocations from the firms’ point of view. The concept of relocation is reformulated by adopting a broad definition considering it as a specific dimension of firms’ mobility options. We consider three analytical dimensions: relocation as a productive problem (“relational space” for coordination), relocation in a territorial dimension (“geographical space”) and relocation as a complex decision-making process (“political space”). On this basis, we combine two strands of literature (economics of proximity and institutional approaches of the firm) for a better understanding of the decision-making process and the resulting diversity of situations. The framework is finally applied to the specific case of the Aquitaine region of southwest France in order to identify the conditions of anchoring and mobility of firms in spatial terms. Our aim is to show that the decision-making process of relocations cannot be reduced to a simple cost calculation, leaving room for local public policies.     

Location choice,life cycle and amenities

Our study proposes a housing location choice model where a household faces a trade‐off between proximity to place of employment and proximity to amenities. We consider subsamples of high amenity cities and low amenity cities and households with and without children. We show that the roles of gender, education, homeownership, household composition, and public transportation vary significantly depending on level of amenities. Households with a female head of household, those with a working spouse and with older children prefer locating closer to downtown amenities. Female workers with and without children locate closer to work, in high and low amenity cities.