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Regional Advantage: Culture and Competition in Silicon Valley and Route 128

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... In the past, the development of new ventures necessitated substantial resources. E-commerce ventures, for example, proliferated in communities where tech-savvy individuals could raise large sums of money to hire talented engineers, buy the necessary computing equipment, and pay for offices to accommodate them (Feldman, 2001;Florida & Kenney, 1988;Saxenian, 1996;Sorenson & Audia, 2000;Vedula & Fitza, 2019). We call attention to and contrast this with the advent of low-code e-commerce tools, such as Shopify, that afford ready-made technical tools to support robust e-commerce operations across a wide number of countries and currencies (Cutolo & Kenney, 2021). ...
... They observe that variation in social capital across communities is one such geographic mechanism that can affect racial disparities in entrepreneurship. Taken together, the evidence suggests that entrepreneurial access shares the general association of entrepreneurial activity with the local endowment of human, financial, and social capital (Feldman, 2001;Florida & Kenney, 1988;Klepper, 2010;Saxenian, 1996;Sorenson & Audia, 2000). ...
... In line with past entrepreneurship research on the predictors of local entrepreneurial activity (e.g., Armington & Acs, 2002;Feldman, 2001;Florida & Kenney, 1988;Klepper, 2010;Saxenian, 1996;Sorenson & Audia, 2000;Vedula & Fitza, 2019), we assembled data on local endowments of human, financial, and social capital at the ZCTA level. We draw on US Census Bureau data in line with prior work (Fairlie & Robb, 2008;Fairlie & Robinson, 2022;Gompers & Wang, 2017). ...
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Entrepreneurship is presented as a path to prosper through commerce, yet there is evidence that certain communities are underrepresented in entrepreneurship. Technological developments such as low‐code e‐commerce tools have altered the barriers to launch commercial ventures. Do these tools alter entrepreneurial inclusion? We study an omnipresent low‐code tool, Shopify, which has dramatically reduced the financial and technical barriers to e‐commerce. We undertake an abductive analysis using unique data on the spatial distribution of Shopify‐based activity for the entire United States. We find evidence of entrepreneurial inclusion; neighborhoods with more Black residents, a group historically underrepresented in entrepreneurship, also have more low‐code ventures. We interpret these results against traditional forms of startups: newly registered businesses and VC‐backed e‐commerce ventures. These benchmark analyses further support our findings. Managerial Summary We consider the impact of recent technological changes that make it easier to start entrepreneurial ventures. We study the spatial uptake of a popular low‐code e‐commerce tool, Shopify, that makes launching and running an online business markedly cheaper and easier. Using data on nearly 160,000 Shopify‐based ventures across the entire United States, we find that usage of Shopify is more prevalent in neighborhoods with more Black residents. The pattern is distinct from that observed for traditional ventures and VC‐backed start‐ups. The evidence suggests low‐code tools represent a novel path to entrepreneurship, enhancing entrepreneurial access and potentially opening previously under‐explored markets. The finding further highlights the role of new tools (e.g., low‐code or AI‐driven) as a possible addition to policies aimed at enhancing entrepreneurial inclusion.
... In a similar spirit, this paper considers the accumulation of experience within an ecosystem. This builds on the seminal work of Saxenian (1994), which describes the human capital and networks of expertise that underlie the success of Silicon Valley. Departing employees of successful ventures that got acquired can become an important source of talent for startups and scaleups alike, the so-called PayPal Mafia being a famous example (Forrest 2014). ...
... The work of Kerr et al. (2017) and Kerr (2018) further documents the interrelationship between migration and agglomeration. Saxenian (2006) provides an ethnographic study of how Silicon Valley is connected to international networks of entrepreneurs. Nanda and Khanna (2010) document how in India diaspora entrepreneurs differ from their domestic counterparts. ...
... As a model extension we now consider another intergenerational linkage, namely, the role of accumulated experience in the ecosystem. The seminal work of Saxenian (1994) describes how a rich set of symbiotic relationships developed in Silicon Valley as it grew in size, noting how experienced entrepreneurs and managers bolstered the next generation of ventures. Here we are particularly interested in how scaleups benefit from the accumulated experience of prior generations of successful scaleups. ...
... Silicon Valley is not a location with specific, official boundaries; it typically refers to the southern part of the San Francisco Bay area in northern California known as Santa Clara Valley. There are several cities and towns in this area, for example Palo Alto, Santa Clara, Mountain View, and San Jose (see Saxenian 1994). For the purposes of my research, a rigid geographical delimitation of the area was not required. ...
... In general, many of the informants had wide-ranging career paths (or perhaps a career in the traditional sense is not the appropriate way to describe the work paths of these professionals). They were clearly in many ways "the best and the brightest" of their home country, in the sense that Saxenian (2006) describes the new Argonauts in her research. Most of the informants had advanced university degrees (master's or doctorate) from a Finnish university. ...
... It seems that there has not been much significant interaction between the two groups, or contact has been limited to occasional and rather formal events, such as the traditional Finnish Independence Day celebration. The latter group-Finns who came to the Silicon Valley area over the past ten to fifteen years-is the natural focus of the present study, since it is the population most relevant for understanding the mobility of highly skilled Finns and global "brain circulation" (Saxenian 2006) today. ...
... Apparu formellement en 2006 (Adner, 2006), le concept d'ESI se scinde aujourd'hui en deux approches (Cohendet et al. 2020), l'une dans la lignée de Gawer et Cusumano (2002) avec les mécanismes de coordination de plateformes, et l'autre dans la lignée des travaux de Saxenian (1994Saxenian ( , 2006, où la notion de territoire occupe une place importante. Cette étude s'inscrit dans la seconde approche, qui tend à accorder une importance à un ancrage territorial dans le concept d'ESI. ...
... Par ailleurs, Boyer (2020), se plaçant dans une perspective écologique et durable (sustainability), mobilise également le concept de middleground comme permettant le processus régénératif (autopoïèse) d'un ESI. Par cette propriété, l'auteur distingue alors les ESI des clusters (Porter, 1990(Porter, , 1998, des systèmes d'innovation (Freeman, 1987(Freeman, , 2008Lundvall, 1992Lundvall, , 2016Edquist, 1997) et des systèmes d'innovation régionaux (Cooke, 1992(Cooke, , 1997(Cooke, , 2003Saxenian, 1994Saxenian, , 2006, qui, sans « mécanismes de régénération, le lockin et la rigidité institutionnelle et structurelle [ainsi que la dépendance de sentier] pourraient se transformer en un piège » (Boyer, 2020, p.13). Également, l'auteur revisite le concept d'ESI à la lumière du modèle panarchique de Gunderson et Holling (2001) instituant, dans la lignée de Moore (1993), un parallèle avec les écosystèmes biologiques et décrivant un cycle de vie (exploitation, conservation, crise, réorganisation) d'un ESI. ...
... Tsujimoto et al. (2018), rappelant que chacun des protagonistes de l'ESI possède son propre point de vue sur l'ESI (domaine idiographique des perceptions), ses attributs, ses croyances, in fine ses valeurs. Également, le principe de « structure d'alignement », déjà naissant chezAdner (2006) peut se voir assimilé avec le principe de cohérence proposé parTsujimoto et al. (2018).Dans la perspective des ESI,Cohendet et al. (2020) s'inscrivent dans le sillon des travaux deSaxenian (1994) sur les clusters régionaux. Aussi, les auteurs mobilisent une littérature empirique de travaux antérieurs(Cohendet et Simon, 2007 ;Simon, 2009 ;Cohendet et al., 2010 ;Grandadam et al., 2013 ;Sarazin et al. 2017 ;) établissant le concept de middleground(Cohendet et Simon, 2017 129 ). ...
Thesis
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De nombreuses études mettent en avant le rôle joué par un écosystème d’innovation (ESI) dans le développement du phénomène d’innovation. Parmi ces études, très peu finalement, explorent les processus info-communicationnels en tant que tels, comme relations « écologiques » entre les protagonistes « faisant système ». Cependant, certains travaux récents appellent à l’importance de qualifier le « sens » qu’accordent les protagonistes à leur contexte d’innovation, afin de mieux en comprendre les démarches. Par une méthodologie ascendante, l’originalité de cette thèse se situe dans une approche idiographique d’un ESI territorial. Au sein d’un paradigme socioconstructiviste, l’étude mobilise la médiation décisionnelle. L’objectif est de mieux cerner comment un ESI peut éclairer les risques-perçus qui sous-tendent les décisions des organisations faisant face à des problématiques d’innovation. Au travers de 15 entretiens semi-ouverts, menés auprès d’entreprises de la mode et du textile en Région Hauts-de-France, l’étude développe une analyse thématique, une analyse de clusters, puis une analyse factorielle, inspirées de la méthode triadique. Par une démarche axiomatico-inductive, les travaux développent un ensemble d’hypothèses autour de la formalisation originale de l’ESI, tel que perçu par les protagonistes. Il est ainsi avancé qu’une telle formalisation de l’ESI peut se résumer en éléments, signifiants clés, inscrits dans une logique triadique (le Dispositif, les Réseaux, les Aspirations, le Territoire, l’Infrastructure) prenant corps au travers d’attributs bivalents (Confiance/Méfiance, Renseignement/Désorientant, Faisabilité/Contestable, Différence/Banalité). Les résultats dressent alors une typologie de construits de sens qui président aux processus décisionnels. L’étude livre ainsi une meilleure appréhension des processus info-communicationnels à l’œuvre au sein d’un ESI, notamment par la caractérisation de ces construits. Les travaux entrepris offrent des outils méthodologiques et opérationnels quant à la manière dont les enjeux de l’innovation sont perçus. Pour des décideurs publics, cette étude met en évidence le rôle souvent sous-estimé d’éléments intangibles, tels que les aspirations des innovateurs.
... Specific characteristics of regions within countries, at certain times, have been associated with entrepreneurship (Fritsch & Storey, 2014;Hall & Sobel, 2008;Rupasingha & Goetz, 2013). For example, Saxenian (1994) argued that the local industrial system of Silicon Valley in California made it a superior place to foster the development of the semiconductor industry versus Route 128 near Boston. Nevertheless, Boston remains a centre for medical technology (Audretsch & Feldman, 1996;Chatterji et al., 2014;Moretti, 2019), and New York City is a hub of innovation in financial services (Porter, 2001). ...
... This literature has observed that most entrepreneurs found companies where they live, and that regions differ in their prevalence and type of entrepreneurial activity. Explanations for regional differences in entrepreneurship centre on regional differences in knowledge flows , culture (Saxenian, 1994;Stuetzer et al., 2018;Tavassoli et al., 2021), access to resources such as capital (Cumming & Li, 2013) and taxes (Bruce et al., 2020). This research includes work published in prior issues of this journal. ...
... We propose that the characteristics of a student's region of origin will influence a student's proclivity towards entrepreneurship. In terms of mechanism, we propose that the institutional context of a student's home region influences their view towards entrepreneurship as both an appropriate activity, as well as a supported and a feasible component of their careers (Welter, 2011). 2 A student's proclivity towards entrepreneurship while enrolled at a university is influenced by norms, culture, and knowledge of entrepreneurship that exists in the economic ecosystem of their home region (Acs & Karlsson, 2002;Glaeser et al., 1992;Saxenian, 1994). A finding consistent with this mechanism would be a positive association between the measures of entrepreneurialism of a student's home region and a student's proclivity towards entrepreneurship. ...
Article
Using data from a large public research university in the United States, we examine the relationship between the characteristics of undergraduate college students’ regional origins and students’ interest in entrepreneurship. We find that several entrepreneurial indicators of students’ regional origins predict students’ entrepreneurial intent and ideation. One possible explanation for our results is that the extent of entrepreneurial activity in a region may imprint attitudes towards entrepreneurial careers on people growing up in those regions. Our findings suggest the composition of admitted students’ geographical origins may impact the entrepreneurial focus of universities’ student bodies.
... They have dominated international mainstream research in economic geography. A large domestic and foreign literature has provided in-depth explorations of the source of industrial clusters' competitive advantages, conditions for their production, regional growth effects, network organization, technological innovation, etc. [10][11][12][13][14][15][16][17][18][19]. ...
... It can be seen that most of the existing literature focuses on industrial clusters in the high-tech, manufacturing, service, and creative industries [10,[12][13][14]16,19,23]. Remarkably, little attention has been paid to clusters in the agricultural sector [2,7,19]. ...
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Agricultural clusters play a powerful role in promoting the agricultural transformation and rejuvenation of rural areas. However, no in-depth exploration has been made on how agricultural clusters form and evolve, especially in the context of China’s long-term small-scale rural economy. The purpose of this article is to reveal the formation process and evolution mechanism of agricultural clusters by case study research. With the knowledge flow as the starting point, this article takes the Vegetable Cluster in Shouguang City of Shandong Province, China as an example to construct a theoretical framework in the three dimensions of points (spin-offs of enterprises or farmers), lines (network-spillovers of various innovation) and planes (the formation of new regional industry spaces) and put forward theoretical hypotheses. It is shown that: (1) The local spin-off of seed farmers is the main path in the transformation of traditional farmers into enterprises. (2) The network-spillover and adoption of innovative knowledge promote the derivation of specialized farmers or enterprises and realize regional agricultural specialization and spatial agglomeration. (3) The formation of the agricultural cluster resulted from the joint effects of spin-off derived from the entrepreneurial spirit of the farmers, network-spillover of various agricultural innovations and spatial integration of the agricultural landscape. The formation of local agricultural innovation systems marks the maturity of an agricultural cluster. This article contribute to the field by studying one source of Alfred Marshall’s knowledge of external economy from the perspective of spin-offs and innovative spillovers, analyzing the agricultural increasing returns to scale neglected by Krugman, and exploring the micro mechanism of farmers’ enterprise-oriented evolution and the formation of agricultural clusters in underdeveloped rural areas. The research results are of profound referential significance for the cultivation of agricultural clusters in developing countries.
... Formality and other institutional setting considerations will also be examined. Industrial and free zones should in theory provide institutional settings conducive to better performance (Porter 1980;Porter 1990;Saxenian 1994;Markusen 1996;Zhang 2016;Audretsch andDohse 2007, Folta et. al 2006). ...
... Free zones also offer better access to suppliers and markets, labour market pooling, spillover of technological know-how, and allow developing countries to make better use of their strong social capital based on trust relationships within the zone or cluster (cf. Porter 1980;Porter 1990;Saxenian 1994;Markusen 1996;Zhang 2016, Audretsch and Dohse 2007, Folta et. al 2006. ...
Preprint
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We use data from the 2020/21 Egyptian Industrial Firm Behavior Survey (EIFBS) to assess the effects of the COVID-19 crisis on firm dynamics, behavior and performance. The crisis emanating from the COVID-19 pandemic induced both demand and supply side shocks, which are more far reaching than any crisis in living memory. Our results show that the crisis has hit the entire Egyptian manufacturing sector. But, in line with Schumpeter's (1934) creative destructive theory, the market shows signs of 'self-cleansing', whereby the less efficient are more likely to exit and downsize their activities. Our descriptive results show resilience of larger, public, formal, and export sector firms. Thus, revealing pre-existing fragilities of the private, informal and, more generally the lower productivity firms in the manufacturing sector. The counter cyclicality of the relation implies that contraction of the formal sector expands the informal as the only alternative way to earn a living. As a 'survival sector', the informal sector has provided 'helping hand employment'. Pre-crisis good managerial practices, innovation, the adoption of advanced technologies and training workers all provide an opportunity for firms to adapt their business model, as reflected by superior firm dynamics and post-crisis performance. Larger firms and mostly less vulnerable sectors such as fabricated metals and rubber have had more access to government support. It is likely that the government has chosen to support sectors with potentially better chances of survival rather than support the most vulnerable. Firms in pharmaceuticals were also recipients of support, which is sensible in a health crisis.
... Rather, the development of Silicon Valley's famous "innovation cluster" offers a prime case study of the interactions and impacts generated by the three "geographies of innovation" discussed in this chapter. Summarized in brief, the most common explanation offered for the rise of Silicon Valley has been that the dynamic evolution of the region over time can be attributed to its economic heritage and the ways in which the actors, institutions, and environment that constitute "the Valley" have interacted throughout its history (Saxenian 1996;Storper et al. 2015). Marked by periods of growth, decline, rebirth, and consolidation, the history of the Valley has also been one of perpetual reinvention and migration (Henton and Held 2013). ...
... As one of the three inventors of the transistor at Bell Labs in New Jersey in 1947, William Shockley was a Nobel Prize-winning scientist who was well recognized and respected for his intelligence and innovation within the engineering community (Brock 2012). In 1956 (shortly before winning the Nobel Prize), Shockley relocated himself from the East Coast to Palo Alto, California, purportedly to be closer to his ill and aging mother (Saxenian, 1996;Adams 2011;Storper et al. 2015). Always the entrepreneur, Shockley then formed a financial agreement with Arnold Beckman to open Shockley Semiconductors as a division of Beckman Instruments (Brock 2012). ...
... Rural migrants who return to their home villages typically have worked urban jobs and possess higher levels of education, business experience, technical skills, and entrepreneurial tendency than rural residents who have never migrated [2]. Research on international migration also suggests that return migrants from advanced economies, after moving back to their home regions, helped create more entrepreneurial ventures and more innovation [3,4]. ...
... Two related streams of research on mobility serve as guideposts for initial theorization. First, the literature on mobility and knowledge transfer conceptualizes individuals as conduits of knowledge [4]. Through knowledge spillovers, individuals transfer valuable information and best practices to other individuals located their destination regions [9]. ...
... Cities that are at the frontier of creativity in one period retain an advantage that persists for a while but not indefinitely. This too echoes similar results on clusters of innovation (Saxenian, 1994;Duranton, 2007;Kerr, 2010). Estimating a transition matrix, we also find that persistence of creativity is higher at the bottom of the distribution than at the top. ...
... In particular, Bénabou et al. (2015a) and Bénabou et al. (2015b) show that religiosity is negatively correlated with indicators of innovation. See also Saxenian (1994), Florida (2005), Falck et al. (2011), Acemoglu et al. (2014, Akcigit et al. (2017a) and Akcigit et al. (2017b). ...
Article
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Creativity is often highly concentrated in time and space, and across different domains. What explains the formation and decay of clusters of creativity? We match data on notable individuals born in Europe between the eleventh and the nineteenth centuries with historical city data. The production and attraction of creative talent is associated with city institutions that protected economic and political freedoms and promoted local autonomy. Instead, indicators of local economic conditions such as city size and real wages, do not predict creative clusters. We also show that famous creatives are spatially concentrated and clustered across disciplines, that their spatial mobility has remained stable over the centuries, and that creative clusters are persistent but less than population.
... Following that train of thought, Saxenian (1994) argues that the mere agglomeration of agents is not sufficient for achieving economic development. Other types of interaction, especially more flexible relations supported by a set of informal social relations and institutions, provide better results. ...
... In addition, other more complex mechanisms than just informal face-to-face contact also take a role in spillover transmission. They include creating spinoff firms, specialized labor mobility (as presented by Saxenian, 1994), human capital transfers between firms, external direct investment (EDI), and the trade or transfer of knowledge-embedded goods (Döring & Schnellenbach, 2006;Ponds et al., 2010). It is worth noting that a region or firm's absorptive capacity, usually measured in domestic R&D expenditures and human capital assets, is also quite important for the diffusion process. ...
Article
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The importance of cooperation in innovation has been widely studied. Cooperative settings are potential platforms for the indirect and direct transmission of knowledge. This article aims to present the results of a systematic literature review on innovation cooperation. It covers topics such as the effects of cooperation according to different governance structures, cooperation drivers, partner’s attributes, firm size, regional factors, and the host country’s current stage of economic development. In general, cooperation is an organizational setting that determines knowledge sharing and diffusion. A significant part of the empirical evidence analyzed here reveals that cooperation has a positive effect on innovation performance. Such a positive correlation is highly likely to be found in case studies of technology-intensive sectors in small regions. However, large datasets, mainly from Europe and China, also yield positive results. Results may also vary according to firms’ attributes and the type of cooperation agreement adopted.
... As geographically bounded institutions, universities and national laboratories are often invoked, by both economists and policymakers, as drivers of local knowledge spillovers (Jaffe, 1989;Acs, Audretsch and Feldman, 1992;Jaffe, Trajtenberg and Henderson, 1993;Moretti, 2012) and local economic development (Adams, Chiang and Jensen, 2003;Kantor and Whalley, 2014;Hausman, 2020). (Feldman, 1994(Feldman, , 2014Saxenian, 1996). For example, in the late 1980s, a group of five North Carolina State engineers conducting pioneering research on the advantages silicon carbide for light-emitting diode (LED) founded a start-up company, Cree. ...
... On the one hand, universities can directly influence their entrepreneurial ecosystem through the establishment of spin-offs and technology transfer activities to industrial partners (Mowery et al., 2001;Bercovitz and Feldman, 2008;Hausman, 2020). Second, it is possible that the impact on local entrepreneurial ecosystems arises from the impact of students and other non-permanent research staff involved in the research itself (Saxenian, 1996). In other words, it is possible that by graduating students who have been exposed to the most recent research activities of the university, the near-term spillovers to the local entrepreneurial ecosystem arises from the knowledge being "wrapped up in a person" (Moretti, 2004;Stephan, 2006;Abramovsky, Harrison and Simpson, 2007). ...
... These legal variations in NCA enforcement have far-reaching implications for regional economic outcomes, as illustrated by comparisons between Silicon Valley's dynamic growthfostered in part by California's prohibition on NCAsand the decline of Massachusetts' Route 128 (Gilson, 1999;Saxenian, 1996). Inspired by California's economic success, researchers have explored how these legal environments impact innovation and economic development (Garmaise, 2011;Marx et al., 2009;Samila & Sorenson, 2011;Stuart & Sorenson, 2003), emphasizing that differences in state legal environments exert a profound influence on organizational practices. ...
Article
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Purpose This study aims to explore the diverse factors influencing the adoption of post-employment noncompete agreements (NCAs) between firms and their CEOs. Drawing on the organizational literature regarding the diffusion of contested organizational practices as well as research on law and organizations, this study seeks to understand how internal power dynamics, legal environments, as well as external economic shocks collectively shape organizational NCA adoptions among leading US corporations. Design/methodology/approach Using NCAs between Standard and Poor’s 500 firms and their CEOs in 1996–2015, this study uses discrete-time event history analysis to examine the impact of CEO duality, state legal environments regarding NCA enforcement and the Great Recession on the hazard ratios of organizational NCA adoption. Findings Organizations are less likely to enforce NCAs with duality CEOs, reflecting internal power dynamics and CEO influence within the organization. The study also finds that firms are more likely to have NCAs with CEOs in states where NCAs are easier to enforce and where partial NCA enforcement is permitted. Finally, the findings underscore how exogenous shocks, particularly the recent Great Recession, prompt firms to adopt NCAs to avoid additional disruptions from CEO turnover. Originality/value This study contributes to management research on the diffusion of contested organizational practices by uncovering various factors at multiple levels that drive the adoption of NCAs. Specifically, this study offers fresh insights into the intricacies of state NCA laws and how organizations respond to their legal environments. Moreover, it sheds light on how unexpected economic events, such as the Great Recession, influence organizations to embrace contested practices, expanding the study of organizational practices beyond conventional investigations of sociopolitical and institutional factors.
... In 2017, eight companies were from Tech or Telecom, and only two were from Oil & Gas (Kauflin, 2017). This shift also coincides with a change in the geography of innovation, which became most visible in the rise of the US West Coast as a new center of R&D and innovation (Saxenian, 1994). Hence, future research needs to widen the perspective and disentangle these developments and their relationship with technological complexity in more detail. ...
Article
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Innovations are widely accepted as fundamental drivers of economic growth by increasing productivity and creating new markets. However, empirical evidence on the long-term relationship between technological progress and economic growth remains scarce, with few studies considering shifts in technologies’ fundamental properties, such as their degree of complexity. Yet, higher levels of complexity are argued to increase technologies’ economic potential, and consequently, ignoring this dimension of technologies provides an incomplete picture of innovations’ growth effects. We address this research gap by exploring the relationship between economic growth and technological complexity over more than 170 years in the United States (US). Utilizing patent data, the concept of the complexity frontier, and partial wavelet analysis, we find that economic growth has not been driven by patented innovation and technological complexity for most of this period. However, since the beginning of the ICT revolution in the 1990s, it has significantly contributed to GDP growth.
... This creates a self-reinforcing cycle where successful entrepreneurial ventures attract talent, investment, and further innovation. The comparison between Silicon Valley and the Boston area in Annalee Saxenian's Regional Advantage: Culture and Competition in Silicon Valley and Route 128 [4] underscores how regional networks, cultural attitudes towards risk and collaboration, and social capital can significantly affect a region's entrepreneurial capacity and economic performance. ...
Chapter
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What matters for economic growth? How we can facilitate economic growth via entrepreneurship? Policy makers needs to invest in culture for creativity, better education, physical capital, digital technologies to create more conducive environment for growth and entrepreneurship. We apply endogenous growth theory to understand how investment into knowledge can and should be translated into productivity, growth, society, creating a better economy. We also discuss why some assumptions of endogenous growth models fail, talking about the European paradox of knowledge - high investment in human capital, training, cultural awareness but this does not translate into growth, jobs and startups. It is not enough to have those investments, but there is a missing link for knowledge to spill over and this is entrepreneurship activity and creating a well-functioning entrepreneurial ecosystems.
... The specialization hypothesis asserts that a spatial cluster of similar firms may foster innovation activities and improve firm productivity. This is because firms can exchange technical expertise and specialized knowledge, share a large and specialized labor pool, save transportation cost, and share inputs or input suppliers (Artz et al., 2016;Bhattacharjee et al., 2023;Marshall, 1920;Porter, 2003;Saxenian, 1994;X. Zhang et al., 2023). ...
Article
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Firm clusters are considered as a contributing factor to local economic development. However, there are limited studies on the effect of firm clusters on the well‐being of rural communities, particularly in terms of income improvement, poverty reduction, and migration. Our research aims to shed light on these relationships at both the household and commune levels. For empirical analysis, we employ the propensity score matching method to mitigate endogeneity bias. Our results reveal the role of firm clusters in increasing income and reducing poverty. Firm clusters also contribute to decreasing labor emigration and attracting immigrants. However, the magnitude of these impacts is relatively small, with moderate effects on income and modest effects on poverty and migration. In particular, firm clusters reduce the commune poverty rate by around 2.36%–2.51% and enhance household annual income by approximately 16.46–17.08 million VND (725–752 USD). Furthermore, analyses at the household level highlight the significance of larger clusters in improving household income. Our research underscores policy implications for rural development with a specific emphasis on firm clusters.
... Since the early 1980s, yet rooted in research with a much longer pedigree, clusters have become the subject of a large literature. This has been motivated not least by the apparent success of Marshallian type industrial districts in Italy (Becattini 1978(Becattini , 1990(Becattini , 1991Piore and Sabel, 1984;Brusco, 1990;Dei Ottati, 1991); by the experience of 'Silicon Valley' (Saxenian, 1994); by the likes of Toyota city and Sakaki in Japan (Ohno, 1988;Friedman, 1988); and by the more recently noticed 'town and village enterprises' (TVEs) of China (Christerson and Lever-Tracy, 1997;Putterman, 1997). Clusters of one form or another have been identified in many parts of the world, and have been associated with major productivity growth and employment creation. ...
... A major research question in the cluster-related papers is about the differential growth rates across the regions (Porter, 1990(Porter, , 1998aSaxenian, 1996;Barro & Sala-i-Martin, 1995). Within this context, some studies emphasize the relationship between cluster formation and entrepreneurship. ...
Article
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In this paper, a "3-Star Analysis,” commonly used in cluster mapping studies in the European Union (E.U.), was conducted, and manufacturing sectors with clustering potential in Turkey were determined across the 26 regions (NUTS 2). This study first introduces a novel concept of “cluster density index” for the manufacturing sectors in Turkey and then analyzes the relationship between the cluster density index and openness, economic development level and public incentives for investment. In this analysis, we used the non-parametric spearman’s rank correlation to test the relationships between the variables of interest.
... It is no coincidence that universities, research centers, and R&D divisions of large companies that employ and train highly qualified professionals often turn into start-up "generators" [Guerrero et al., 2016;Fritsch, Wyrwich, 2019]. About 44% of the world's start-ups ( Figure 2) are concentrated in California and Massachusetts, the leading entrepreneurial ecosystems which originally emerged around MIT and Stanford University [Saxenian, 1996]. By 2017, the latter's alumni had launched more than 50 unicorn 4 companies (out of approximately 270 in the world, or ≈19%). ...
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Zemtsov S., Chepurenko A., Mikhailov A. (2021) Pandemic Challenges for the Technological Startups in the Russian Regions. Foresight and STI Governance, 15(4), 61–77. DOI: 10.17323/2500-2597.2021.4.61.77 ||| Technological startups help to adapt economies to the global risks and allow one to track future trends. This paper identifies the main trends and birth factors of new high-tech companies in the Russian regions during 2013-2020. In 2020, fewer than 10,000 startups were created , this number has been steadily declining (by 40% since 2015), especially during the pandemic (-21%). Most of the startups are concentrated in Moscow, the Moscow region, St Petersburg, and the largest metropolitan areas. The share of the Leningrad, Belgorod, Kaliningrad, Lipetsk, Ulyanovsk, and Kaluga regions is growing due to the proactive policies of local authorities. Most startups are associated with knowledge-intensive services for business (B2B) and digital technologies. In 2020, their number increased in pharmaceuticals (about 100%) and in the production of medical devices (by about 30%). Based on the results of econometric analysis, start-up activity in Russia, analogous to countries with an established market economy, depends upon human capital concentration , market access, and a favorable business climate. Universities, through attracting students, especially those in STEM specialties, stimulate startup creation; although the share of university startups does not exceed one third of a percent. Budgetary and university expenditures on R&D are ineffective in terms of creating new companies. The influence of development institutions on start-up activity was not found, while clusters and technology parks have a weak effect. The growth of startups is lower in regions with a predominance of large organizations, as well as in resource centers. The latter may be one of the manifestations of the "resource curse". Startup activity is stable over time and depends on the situation in neighboring regions, which limits the chances to change the situation by means of entrepreneurship support policy. During the pandemic, start-up activity decreased minimally in regions with large metropolitan areas and a high level of education. Recommendations include tools for establishing a more balanced cross-regional situation by implementing the model of an entrepreneurial university, an expansion of start-ups' access to capital and markets, and the regionalization of entrepreneurship policies. Русская версия: https://www.researchgate.net/publication/356893250_Vyzovy_pandemii_dla_tehnologiceskih_startapov_v_regionah_Rossii
... on-the-job training to cope with scarcity) may have considerable regional specificities even within one and the same country (see e.g. Saxenian 1994). However, the operationalization and organization of institutional functions as well as the implementation and transformation of these institutions may also well be shaped by (inter)national institutions. ...
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The development and application of technologies such as robots and artificial intelligence drive a shift toward non-routinized, creative work. A stylized narrative is that a few regions dominate the making of these technologies and enjoy a virtuous cycle of increasing employment, innovativeness, and in-migration of the creative class. Regions merely applying these technologies may get into a vicious cycle of increasing unemployment, out-migration, and decreasing innovativeness. Following the normative governance turn in regional political economics, this theoretical policy paper pitches a framework of three complementary institutions to direct the technology-driven structural change for regional catching-up. Firstly, a system for innovation and entrepreneurial activity creates jobs by supporting exploitation of complementarities of application, co-development activities, and product innovation within mature and emerging sectors. Secondly, education provides creative and entrepreneurial skills to exploit technological opportunities and upskills workers for emerging sectors. Thirdly, labour market and social security institutions are to allow rationalization in mature sectors, incentivize hiring and learning on the job, as well as encourage innovative ventures, notably in emerging sectors. Challenges of implementation of the framework due to path-dependence, co-evolution, and multi-scalarity as well as applicability in different varieties of capitalism are examined.
... Why economic, industrial, and technological development differs across regions is a central question for economic geography. This debate has been conducted under various labels (Bianchi, 1998;Florida, 2005;Porter, 2000;Saxenian, 1996) and synthesized into the RIS approach Braczyk et al., 1998;Coenen and Morgan, 2019). A RIS analysis might produce insights on how well organizations and institutions within a region are aligned, yield advice on how regional economic actors coordinate more effectively, and point to policies that could foster innovative regional activity (Heidenreich, 2004;Isaksen et al., 2018). ...
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... Technology development is widely understood as a cumulative process highly dependent on the specific geographic context. Technological expertise and innovations tend to originate and grow within a limited geographic area that permits complex knowledge and ideas to be transmitted and shared in the local scientific community via frequent face-to-face interactions (Audretsch & Feldman, 1996;Saxenian, 1994). As knowledge spillovers remain to a large extent geographically bounded (Jaffe et al., 1993;Singh, 2007), innovation activities are likely to concentrate in regional technological clusters and benefit from agglomeration economies (Chung & Alcácer, 2002). ...
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We examine the effect of R&D on foreign subsidiaries’ productivity performance. We argue that both local R&D expenditures in the subsidiary and R&D conducted in the wider network of the multinational enterprise (MNE) for the subsidiary improve productivity but that their respective roles depend on whether the host country of the subsidiary is at or below the global technology frontier. Local R&D is more effective if the host country is at the frontier, while R&D conducted in the MNE network is more effective if the host country is behind the frontier. In the latter case, both types of R&D are complementary and reinforce each other’s effect on productivity performance. We test hypotheses on fine-grained longitudinal micro data on affiliate productivity and R&D investments. We estimate dynamic productivity models controlling for endogeneity and allowing for declining returns to R&D and productivity convergence.
... National Innovation Systems' strong roots in economic geography (Martin and Nightingale, 2000) have resulted in the creation and development of the concept of regional innovation system (RIS), arguing that geographical parameters are important, especially for the exchange of tacit knowledge (Saxenian, 1994). Numerous case studies have shown that peripheral systems present many differences compared to each other (Wolfe and Gertler, 1998) and so a variety of frameworks have been developed to identify and capture local innovation features Cooke, Uranga and Etxebarria, 1997). ...
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James Moore coined the term business ecosystem, where businesses are considered as components of an ecosystem in which they collaborate, satisfying consumers and integrating innovation. A business ecosystem is an economic community supported by a structure of interacting organizations-businesses and individuals producing goods and services for consumers. The business strategy in a regional and local innovation ecosystem faces various challenges, such as a possible conflict with the great forces of the ecosystem and the creation of a healthy partnership for the development of new products-services. The business strategy developed in these ecosystems takes the form of new companies that use technological change to introduce new products or new business models through new competitive scenarios and the reciprocal relationships developed in this context. However, most businesses, especially in remote and underdeveloped regional and local business ecosystems, are facing many challenges; as such they require a different support framework for their innovation system. This system should work a way that it will enable organizations to develop their innovations based on their business partnerships, being able at the same time to balance their cognitive asymmetries. In the present research study, through the literature review of scientific research in the field of regional innovation systems and less developed business ecosystems, the central analytical dimensions and strategies (Stra.Tech. Man innovation theory) are identified and analyzed to determine how they could contribute to achieve effective business innovation and long-term stable growth and development.
... The geographical affinity between investors and promoters, therefore, positively affects the fulfilment of the monetary objective of a crowdfunding campaign (Cha 2017) and thus its success (Knudsen, Florida, Gates & Stolarick, 2007) and Saxenian, 1996). Burtch, Ghose & Wattal (2014) also find that lenders typically prefer borrowers who are socially proximate to themselves, in the sense that, they share a similar culture and are less geographically distant. ...
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... These multilevel nature of collaboration networks represent a key feature that may advance our understanding of innovation processes. Yet, empirical evidence on multilevel innovation networks remains scant (Paruchuri et al, 2019), with most work focusing either on intra-regional networks (e.g., Saxenian, 1996;Fleming et al., 2007) or on connections between regions (e.g., Breschi & Lenzi, 2015;Miguelez & Moreno, 2018). Our study makes a step forward in this direction by conducting a multilevel analysis to understand the effects of brokerage on regional innovation performance. ...
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... Свыше 95% их основателей имели высшее образование, набирая соответствующую по квалификации команду [Wright et al., 2007]. Неслучайно поэтому точками зарождения стартапов часто становятся университеты, научные центры и исследовательские отделы крупных компаний, привлекающие к работе и готовящие высококвалифицированных профессионалов [Guerrero et al., 2016;Фрич, Вюрвих, 2019] и Массачусетсе -ведущих предпринимательских экосистемах, первоначально сложившихся вокруг Массачусетского технологического и Стэнфордского университетов [Saxenian, 1996]. К 2017 г. выпускники последнего запустили более 50 компаний-«единорогов» 4 из примерно 270 во всем мире (≈19%). ...
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Zemtsov S., Chepurenko A., Mikhailov A. (2021) Pandemic Challenges for the Technological Startups in the Russian Regions. Foresight and STI Governance, 15(4), 61–77. DOI: 10.17323/2500-2597.2021.4.61.77 ||| Технологические стартапы помогают адаптироваться к глобальным вызовам и позволяют выявить будущие тренды. За период 2013–2020 гг. в регионах России ежегодно возникало менее 10 тыс. новых высокотехнологичных компаний с ненулевой выручкой (стартапов), и их число неуклонно сокращается: на 40% с 2015 г.; под давлением кризиса, вызванного пандемией COVID-19, — на 21%. Большая часть стартапов сконцентрированы в Москве, Подмосковье, Санкт-Петербурге и крупнейших агломерациях, однако благодаря проактивной политике местных властей растет доля Ленинградской, Белгородской, Калининградской, Липецкой, Ульяновской и Калужской областей. Основная доля стартапов связаны с наукоемкими сервисами для бизнеса (B2B) и цифровыми технологиями. В 2020 г. наибольшими темпами росло число стартапов в отраслях, связанных со здравоохранением: вдвое — в фармацевтике, в 1.3 раза — в производстве медицинских приборов.Как показал эконометрический анализ, стартап-активность в России, как и в развитых странах, зависит от концентрации человеческого капитала, доступности рынков и благоприятного делового климата. Хотя доля вузовских стартапов не превышает трети процента, университеты играют стимулирующую роль за счет своих студентов и выпускников, в особенности STEM-специальностей. Бюджетные затраты на исследования и разработки оказываются неэффективными. Влияние на стартап-активность институтов развития, кластеров и технопарков колеблется от слабого до пренебрежимого. Ниже прирост стартапов в регионах с преобладанием крупных компаний и в центрах сырьевой добычи. Стартап-активность устойчива во времени и зависит от ситуации в соседних регионах, т.е. неэластична к краткосрочным мерам поддержки. Наименьшее снижение соответствующих индикаторов в период пандемии демонстрируют регионы с крупными агломерациями и высоким уровнем образования. Стимулирование стартап-индустрии могло бы опираться на такие механизмы, как межрегиональное выравнивание за счет продвижения предпринимательских университетов, расширение доступа к капиталу и рынкам, а также регионализация политики. ||| Technological startups help to adapt to the global risks and allow one to track future trends. This paper identifies the main trends and birth factors of new high-tech companies in the Russian regions during 2013-2020. In 2020, fewer than 10,000 startups were created, this number has been steadily declining (by 40% since 2015), especially during the pandemic (-21%). Most of the startups are concentrated in Moscow, the Moscow region, St Petersburg, and the largest metropolitan areas. The share of the Leningrad, Belgorod, Kaliningrad, Lipetsk, Ulyanovsk, and Kaluga regions is growing due to the proactive policies of local authorities. Most startups are associated with knowledge-intensive services for business (B2B) and digital technologies. In 2020, their number increased in pharmaceuticals (about 100%) and in the production of medical devices (by about 30%). Based on the results of econometric analysis, start-up activity in Russia, analogous to countries with an established market economy, depends upon human capital concentration, market access, and a favorable business climate. Universities, through attracting students, especially those in STEM specialties, stimulate startup creation; although the share of university startups does not exceed one third of a percent. Budgetary and university expenditures on R&D are ineffective in terms of creating new companies. The influence of development institutions on start-up activity was not found, while clusters and technology parks have a weak effect. The growth of startups is lower in regions with a predominance of large organizations, as well as in resource centers. The latter may be one of the manifestations of the “resource curse”. Startup activity is stable over time and depends on the situation in neighboring regions, which limits the chances to change the situation by means of entrepreneurship support policy. During the pandemic, start-up activity decreased minimally in regions with large metropolitan areas and a high level of education. Recommendations include tools for establishing a more balanced cross-regional situation by implementing the model of an entrepreneurial university, an expansion of start-ups’ access to capital and markets, and the regionalization of entrepreneurship policies. English version: https://www.researchgate.net/publication/358346310_Pandemic_challenges_for_the_technological_startups_in_the_Russian_regions
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Previous studies document a strong organization capital effect in stock returns. We investigate whether and how R&D activities affect this organization capital effect. We find that the organization capital effect is stronger in firms with R&D activities. The annual abnormal return of the hedge portfolio sorted by organization capital is 2.41% for R&D firms but only 0.41% for non-R&D firms. Further analyses show that the organization capital effect can be attributed to R&D characteristics rather than R&D risk factors. This article is protected by copyright. All rights reserved
Thesis
Innover l’innovation. Telle est l’idée de l’innovation ouverte qui, dès sa formalisation dans les sciences de gestion, est déclarée comme le « nouvel impératif pour créer et profiter des technologies ». Présentée comme un nouveau paradigme de gestion, cette notion recouvre cependant des définitions et des réalités fort variées selon les acteurs qui sont toujours de plus en plus nombreux à rechercher ses modes d’organisation. Cette thèse porte précisément sur cette recherche de nouveaux modèles qui ne se construisent ni au sein des entreprises ni seulement par des collectifs d’innovation, mais à travers des lieux et des dispositifs de coopération en présentiel qui émergent dans les mondes numériques pour agir dans l’entre-deux, comme des espaces tiers à ces derniers. Elle entend montrer que cette recherche permanente, loin d’être aléatoire, est organisée au-delà d’un assemblage d’outils de gestion, par des modes d’action et de représentation qui se constituent au sein de ces lieux, de manière située, sous forme de nouvelles conventions pratiques et relationnelles du travail coopératif. Dans une démarche empirique, cette thèse propose une immersion ethnographique dans l’expérience de « La Cantine », le premier espace de coworking qui se constitue comme le haut lieu de l’innovation numérique à Paris, géré par une association d’entreprises, Silicon Sentier. Initiée en 2010 comme une participation observante, l’enquête est conduite entre les années 2011 et 2014 sur trois fronts : le lieu, les dispositifs d’innovation ouverte et le travail d’intermédiation mené à la frontière de mondes hétérogènes. Plutôt que de considérer l’innovation ouverte comme une donnée d’entrée, la description permet de suivre la manière dont une conception
Preprint
University rankings are increasingly adopted for academic comparison and success quantification, even to establish performance-based criteria for funding assignment. However, rankings are not neutral tools, and their use frequently overlooks disparities in the starting conditions of institutions. In this research, we detect and measure structural biases that affect in inhomogeneous ways the ranking outcomes of universities from diversified territorial and educational contexts. Moreover, we develop a fairer rating system based on a fully data-driven debiasing strategy that returns an equity-oriented redefinition of the achieved scores. The key idea consists in partitioning universities in similarity groups, determined from multifaceted data using complex network analysis, and referring the performance of each institution to an expectation based on its peers. Significant evidence of territorial biases emerges for official rankings concerning both the OECD and Italian university systems, hence debiasing provides relevant insights suggesting the design of fairer strategies for performance-based funding allocations.
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