Knowledge, Innovation and Space

Knowledge, Innovation and Space

New Horizons in Regional Science series

Edited by Charlie Karlsson, Börje Johansson, Kiyoshi Kobayashi and Roger R. Stough

The contributions in this volume extend our understanding about the different ways distance impacts the knowledge conversion process. Knowledge itself is a raw input into the innovation process which can then transform it into an economically useful output such as prototypes, patents, licences and new companies. New knowledge is often tacit and thus tends to be highly localized, as indeed is the conversion process. Consequently, as the book demonstrates, space or distance matter significantly in the transformation of raw knowledge into beneficial knowledge.

Chapter 2: Entrepreneurial opportunity in innovative urban environments

Otto Raspe and Frank Van Oort

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


Regions are regarded as focal points for knowledge creation, learning, and economic growth in the current global knowledge economy (Karlsson et al., 2009). Regions function as collectors and repositories of knowledge and ideas, and provide an infrastructure facilitating the flow of knowledge, ideas and learning (Florida, 1995). Recently, new firm formation has especially garnered attention in this regional knowledge spillover and economic growth perspective (Acs and Plummer, 2005). Entrepreneurial activity tends to be larger in contexts where knowledge endowments are relatively high (for example, in universities and incumbent firms), as new firms will start using un-commercialized knowledge that has spilled over from other firms and universities (Acs et al., 2004; Audretsch and Keilbach, 2007). Geroski (1995) argues that new firms’ growth and survival prospects depend on their ability to learn from their environment, and to adjust their strategic behavior to the changing configuration of that environment. Empirical research by Audretsch et al. (2006) confirms that knowledge-based start-ups are superior when they are able to access knowledge spillovers through geographic proximity to knowledge sources. Besides this positive impact of knowledge externalities, the literature also stresses negative knowledge-related externalities linked to new firms. The ‘geography of opportunity’ literature indicates that organizations also compete with one another for vital (knowledge) resources (Sorenson and Audia 2000).

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