Edited by Giacomo Becattini, Marco Bellandi and Lisa De Propis
Chapter 21: Innovation Processes and Industrial Districts
Paul L. Robertson, David Jacobson, and Richard N. Langlois* 1. introduction Innovation1 is based on the generation, diffusion and use of new knowledge. While it is possible to conceive of a firm that is so hermetic in its use of knowledge that all stages of innovation, including the combination of old and new knowledge, rely exclusively on internal sources, in practice most innovations involving products or processes of even modest complexity entail combining knowledge that derives, directly or indirectly, from several sources. Knowledge generation, therefore, must be accompanied by effective mechanisms for knowledge diffusion and for ‘indigenizing’ knowledge originally developed in other contexts and for other purposes so that it meets a new need. Because of their individual qualities, industrial districts (IDs) have special environmental characteristics for innovation. When accompanied by close social relationships, tight geographical proximity may affect innovation in ways that are less common in more highly dispersed environments. For example, an awareness of common problems can encourage several firms, or their suppliers and customers, to seek solutions, leading to multiple results that can be tested competitively in the market. These outcomes can then be relatively easily dif used among firms in the f ID because of embeddedness in a common environ ent. The obverse of this comm monality of inspiration and ease of transmission of knowledge, however, may be an inordinately inward focus that results in an ignorance of or disdain for innovation processes in other regions or in indusries not represented in the ID. Furthermore, t...
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