Change search
ReferencesLink to record
Permanent link

Direct link
The Influence of Clustering on MNE location and Innovation in Great Britain
KTH, School of Industrial Engineering and Management (ITM), Industrial Economics and Management (Dept.), Economics. KTH, School of Industrial Engineering and Management (ITM), Centres, Centre of Excellence for Science and Innovation Studies, CESIS.ORCID iD: 0000-0002-5871-8571
Jönköping International Business School, Jönköping University.
2011 (English)In: Innovation and Multidimensional Entrepreneurship: Economic, Social and Academic Aspects / [ed] Iréne Bernard, ABM-media AS, 2011Chapter in book (Other academic)
Abstract [en]

This paper addresses two questions: what, if anything, is the influence of geographicconcentration of economic activity on patterns of foreign direct investment; what is therelationship, if any, between geographic concentration of economic activity, multinationality andinnovation. The paper identifies the consensus view which is emerging in the literature, based onboth theory and evidence, that strong clusters are likely to be attractive for inward directinvestment and that they promote innovation. The paper tests whether this relationship is evidentin Great Britain using data derived from the UK’s Annual Foreign Direct Investment survey andthe UK’s Community Innovation Survey 2007. It addresses a surprising gap in the emergingliterature by also examining the relationship between cluster strength and outward directinvestment, thereby testing Porter’s (1990) claim in The Competitive Advantage of Nations, thatadvantages gained in strong clusters would be the foundations of international competitiveness.The paper also distinguishes between two different types of agglomeration economy, localisationeconomies based on collocation of firms in related lines of activity, and urbanisation economiesbased on the overall concentration of economic activity in a particular region, a distinction mostof the emerging literature in International Business has not made clear. The first set of modelsexamine the propensity to engage in outward direct investment and the geographic pattern offoreign ownership of firms active in Great Britain and find that both are positively related tocluster strength, with localisation economies being more important than urbanisation economies.T wo models of innovation are estimated, the first examines what factors influence firms to beinnovative and the second what influences innovation effort as measured by R&D intensity. Inboth cases there is evidence that regional agglomeration promotes innovation and that there arestronger effects flowing from own industry agglomeration than from broader regional scale.

Place, publisher, year, edition, pages
ABM-media AS, 2011.
, Uddevalla symposiet
Keyword [en]
Entrepreneurship, regional science, innovation, economics, urban development
National Category
URN: urn:nbn:se:kth:diva-70378ISBN: 978-91-633-7747-1OAI: diva2:486228
QC 20120410Available from: 2012-01-30 Created: 2012-01-30 Last updated: 2012-04-10Bibliographically approved

Open Access in DiVA

No full text

Other links

Search in DiVA

By author/editor
Lööf, HansJohansson, Börje
By organisation
EconomicsCentre of Excellence for Science and Innovation Studies, CESIS

Search outside of DiVA

GoogleGoogle Scholar
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

Total: 61 hits
ReferencesLink to record
Permanent link

Direct link