Capabilities for Innovation in a Globalizing World: from Nearby or at a Distance?

Abstract

Objective: This paper addresses the question of how clustering affects firms' capabilities to innovate. Research Design & Methods:This paper uses a specifically tailored survey carried out in 2013 of the geographical distance and scope of collaboration for innovation of 2002 firms located in the four largest Norwegian city-regions with the rest of the country as a separate category.Findings: We find that a majority of firms are located in regional clusters.However, the number of international relations increases the capacity to innovate.An international business environment stimulates the capability to innovate more than being part of a regional cluster.Implications & Recommendations: Firms that successfully develop global pipelines to knowledge sources in distant locations often sidestep the risk of lock-in, associated with relying solely on local sources of information (Malecki, 2010;Fitjar & Rodríguez-Pose, 2011).Contribution & Value Added: Our findings suggest that caution should be exercised when invoking the concept of regional clusters to explain or define regional competitiveness.The cluster model obviously assigns too much importance to the regional business context, and to local interaction and externalities.These findings suggest that policies to advance the capabilities to innovate in Norwegian firms and regions may need to be revised.

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