Dario Diodato, Frank Neffke, Neave O’Clery
We document the heterogeneity across sectors in the impact labor and input-output links have on industry agglomeration. Exploiting the available degrees of freedom in coagglomeration patterns, we estimate the industry-specific benefits of sharing labor needs and supply links with local firms. On aggregate, coagglomeration patterns of services are at least as strongly driven by input-output linkages as those of manufacturing, whereas labor linkages are much more potent drivers of coagglomeration in services than in manufacturing. Moreover, the degree to which labor and input-output linkages are reflected in an industry’s coagglomeration patterns is relevant for predicting patterns of city-industry employment growth.
Comments Off on # 16.26 Agglomeration economies: the heterogeneous contribution of human capital and value chains
Andrea Filippetti, Frederick Guy
We argue that human capital does a better job of fostering innovation when an economy has a diverse portfolio of specialist skills to draw on. While such a diverse portfolio is beneficial for a country, it includes many individual skill packages that are subject to considerable labour market risk. In the absence of strong income insurance (job security or unemployment insurance), the flight to safety in human capital investments will produce a national skill portfolio which is poorly diversified and less conducive to innovation.
Using country-level data for 25 OECD countries from 1985 to 2009, we find evidence that income insurance raises the marginal effect of human capital on innovation, with the latter measured by patenting. At the same time, we find a direct negative effect of insurance on patenting; at low-medium levels of human capital, the direct negative effect more than offsets the positive indirect effect, while at high levels of human capital the indirect positive effect dominates. We draw implications for income insurance and education policy.
Comments Off on # 16.25 Risk-taking, skill diversity, and the quality of human capital: how insurance affects innovation
FabLabs (fabrication laboratories) have become popular but the academic literature on this entrepreneurial phenomenon is scant. This paper provides some insight into the sources of Fablab performance based on original data on the characteristics and interactions between (n = 48) FabLabs and their ecosystem. A FabLab is a geographically located, intermediary platform which reduces the matching and searching costs to stakeholders involved in an entrepreneurial endeavor. We find that a FabLab is less productive if disconnected from its ecosystem. Innovation production is highest when the FabLab acts as a platform allowing interactions between small explorative firms, and large exploitative firms. Its innovation remains explorative if the interaction involves only small explorative firms. Our study has some implications for the management of FabLabs and their ambiguous impact on the overall innovation ecosystem in relation to resilience, smart specialization and diversification.
Comments Off on # 16.23 Place, platform, and knowledge co-production dynamics: Evidence from makers and FabLab
Robert Hassink, Huiwen Gong, Fabian Faller
Since the launch of new economic geography by Paul Krugman there have been intensive debates between geographical economists and economic geographers both about the ways they differ from each other as well as about potential complementarities. Overman’s (2004) provocative article, titled “can we learning anything from economic geography proper?” has been not very helpful in developing the latter. By responding to his core critiques we provide a much more positive answer to his question, do justice to economic geography and show more complementarities between geographical economics and economic geography.
Comments Off on # 16.22 Can we learn anything from economic geography proper? Yes, we can!
Jeroen Content, Koen Frenken
Since the introduction of the related variety in 2007, a number of studies have been undertaken to analyze the effect of related variety on economic development. Our review of 21 studies makes clear that most studies find support for the initial hypothesis that related variety supports employment growth, though some studies suggest that the growth effects of related variety may be specific to knowledge-intensive sectors only. From the review, we list a number of further research questions regarding: methodology, the role of unrelated variety, different forms of relatedness, and the effect of related variety on knowledge production and entrepreneurship.
Comments Off on # 16.21 Related variety and economic development:a literature review
It is argued that innovation policy based on notions of market failure or system failure is too limited in the context of current societal challenges. I propose a third, complexity-theoretic approach. This approach starts from the observation that most innovations are related to existing activities, and that policy’s additionality is highest for unrelated diversification. To trigger unrelated diversification into activities that contribute to solving societal challenges, government’s main task is to organize the process of demand articulation. This process leads to clear and manageable societal objectives that effectively guide a temporary collation of actors to develop solutions bottom-up. The combination of a broad coalition, a clear objective and tentative governance are the means to cope with the inherent complexity of modern-day innovation.
Comments Off on # 16.19 A Complexity-Theoretic Perspective on Innovation Policy
Neil Lee, Andrés Rodríguez-Pose
High-technology industries are seen as important in helping urban economies thrive, but at the same time they are often considered as potential drivers of relative poverty and social exclusion. However, little research has assessed how high-tech affects urban poverty and the wages of workers at the bottom of the pyramid. This paper addresses this gap in the literature and investigates the relationship between employment in high-tech industries, poverty and the labor market for non-degree educated workers using a panel of 295 Metropolitan Statistical Areas (MSAs) in the United States between 2005 and 2011. The results of the analysis show no real impact of the presence of high-technology industries on poverty and, especially, extreme poverty. Yet there is strong evidence that tech-employment increases wages for non-degree educated workers and, to a lesser extent, employment for those without degrees. These results suggest that while tech employment has some role in improving welfare for non-degree educated workers, tech-employment alone is not enough to reduce poverty.
Comments Off on # 16.18 Is there trickle-down from tech? Poverty, employment and the high-technology multiplier in US cities