Innovation in cities:: Science-based diversity, specialization and localized competition

Whether diversity or specialization of economic activity better promotes technological change and subsequent economic growth has been the subject of a heated debate in the economics literature. The purpose of this paper is to consider the effect of the composition of economic activity on innovation....

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Bibliographic Details
Published in:European economic review 1999-02, Vol.43 (2), p.409-429
Main Authors: Feldman, Maryann P, Audretsch, David B
Format: Article
Language:English
Subjects:
Agglomeration
Cities
Competition
Economic activity
Economic development
Economic growth
Geography
Innovation
Innovations
International trade
Regional specialization
Science
Specialization
Spillovers
Statistical analysis
Studies
Trade
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Summary:Whether diversity or specialization of economic activity better promotes technological change and subsequent economic growth has been the subject of a heated debate in the economics literature. The purpose of this paper is to consider the effect of the composition of economic activity on innovation. We test whether the specialization of economic activity within a narrow concentrated set of economic activities is more conducive to knowledge spillovers or if diversity, by bringing together complementary activities, better promotes innovation. The evidence provides considerable support for the diversity thesis but little support for the specialization thesis.
ISSN:0014-2921
1873-572X
DOI:10.1016/S0014-2921(98)00047-6