Platforms of Innovation

Platforms of Innovation

Dynamics of New Industrial Knowledge Flows

Edited by Philip Cooke, Carla De Laurentis, Stewart MacNeill and Chris Collinge

This ground-breaking book offers a coherent theoretical analysis of contemporary industrial knowledge flow dynamics. Furthermore, it advances wide-ranging and varied empirical findings from international comparative research which demonstrate that knowledge cross-pollination, often from industrially unrelated business sectors, is now commonplace in the economics of innovation. This, the authors argue, represents the rise of an externalized ‘matrix’ of knowledge flow dynamics among firms and industries. The book also examines related economic governance research that reveals the catalytic role that leading innovation policy agencies play in animating knowledge flow dynamics, particularly at the regional level. The chapters address various sectors including food and drink, biotechnology, ICT, new media, the automotive industry and tourism.

Chapter 7: Knowledge-Intensive Business Services (KIBS)

Simone Strambach

Subjects: economics and finance, economics of innovation, industrial economics, innovation and technology, economics of innovation, urban and regional studies, regional economics

Extract

Simone Strambach INTRODUCTION 7.1 Knowledge-intensive business services firms are organizations that are particularly representative for knowledge-based economies (Gallouj, 2002). Knowledge is not only the key production factor of these service firms, it is also the ‘good’ they sell. Professional service firms, including management consultancy, technical engineering services, research and development, software and information processing services, or advertising and marketing services, mainly provide non-material services. The primary value-added activities consist of the creation, accumulation and dissemination of knowledge for the purpose of developing customized intangible service solutions (Bettencourt et al., 2002). The commodities these firms trade on the market are to a large extent intangible and knowledge-intensive. They are involved in the exchange and conversion of knowledge for economic gain and value-added processes. The knowledge-intensive business services (KIBS) industries have been among the most dynamic segments of the service sector in European countries since the mid-1980s. Initially this growth was primarily seen as a demand-led, cost-driven, outsourcing phenomenon. However, KIBS also play an increasingly important role for the performance of their clients’ sectors, as they provide ‘vital input to the performance of other sectors of the economy’ (EMCC, 2005: 19; cf. den Hertog and Bilderbeek, 2000; Hauknes, 2000; Miles, 2005). This emphasizes the relevance and benefits of KIBS for the knowledge dynamics of their different client industries, often referred to as indirect effects on the system level. Studies of innovation systems and research in service innovation have especially outlined the more central role that KIBS firms are playing in innovation – as...

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