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Do Networks Matter for Innovation? The usefulness of the economic network approach in analysing innovation

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  • Leon A.G. Oerlemans
  • Marius T.H. Meeus
  • Frans W.M. Boekema

Abstract

Economic network theory emphasises the importance of external resource mobilisation. In this paper, the relations between the mobilisation and use of internal and external resources in innovation processes, and the innovative performance of firms, are explored empirically, using an adapted version of Håkansson's (1987) economic network model. The main research question was: to what extent do network variables contribute to the innovative performance of firms? To answer this question, we assessed the explanatory power of economic network theory within the empirical study of innovation. Firms were found to engage in various configurations of internal and external resource bases, enabling them to innovate with better results. The relations in the estimated models are strongly influenced by moderating variables such as sector, and type and level of innovations produced. Our main conclusion is that models that include both internal and external resources explain the innovative performance better than models in which only internal resources are used.

Suggested Citation

  • Leon A.G. Oerlemans & Marius T.H. Meeus & Frans W.M. Boekema, 1998. "Do Networks Matter for Innovation? The usefulness of the economic network approach in analysing innovation," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 89(3), pages 298-309, August.
    • Handle: RePEc:bla:tvecsg:v:89:y:1998:i:3:p:298-309
    DOI: 10.1111/1467-9663.00029
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    Cited by:

    1. Stephen Roper, 2005. "Cross-Border and Local Cooperation on the island of Ireland - A Behavioural Perspective," ERSA conference papers ersa05p475, European Regional Science Association.
    2. Kadri Ukrainski & Urmas Varblane, 2005. "Sources Of Innovation In The Estonian Forest And Wood Cluster," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 36, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    3. Justin Doran & Declan Jordan & Eoin O'Leary, 2012. "The Effects of National and International Interaction on Innovation: Evidence from the Irish CIS: 2004--06," Industry and Innovation, Taylor & Francis Journals, vol. 19(5), pages 371-390, July.
    4. Doran, Justin & O'Leary, Eoin, 2013. "The Roles of R&D and networking for innovation by Irish and foreign-owned firms: evidence from the Irish CIS 2006-08," MPRA Paper 47291, University Library of Munich, Germany.
    5. A.A. Egbetokun & A.A. Adeniyi & W.O. Siyanbola, 2012. "On the capability of SMEs to innovate: the cable and wire manufacturing subsector in Nigeria," International Journal of Learning and Intellectual Capital, Inderscience Enterprises Ltd, vol. 9(1/2), pages 64-85.
    6. Trigo, Alexandre & Vence, Xavier, 2012. "Scope and patterns of innovation cooperation in Spanish service enterprises," Research Policy, Elsevier, vol. 41(3), pages 602-613.
    7. Weterings, Anet & Boschma, Ron, 2009. "Does spatial proximity to customers matter for innovative performance?: Evidence from the Dutch software sector," Research Policy, Elsevier, vol. 38(5), pages 746-755, June.
    8. Oerlemans, Leon A.G. & Meeus, Marius T.H., 2002. "Spatial embeddedness and firm performance: an empirical exploration of the effects of proximity on innovative and economic performance," ERSA conference papers ersa02p054, European Regional Science Association.
    9. Andræs Barge-Gil, 2013. "Open Strategies and Innovation Performance," Industry and Innovation, Taylor & Francis Journals, vol. 20(7), pages 585-610, October.
    10. Justin Doran & Declan Jordan, 2016. "Cross-sectoral differences in the drivers of innovation," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 43(5), pages 719-748, October.
    11. de Jong, Jeroen P.J. & Marsili, Orietta, 2006. "The fruit flies of innovations: A taxonomy of innovative small firms," Research Policy, Elsevier, vol. 35(2), pages 213-229, March.
    12. Stephen Roper, 2001. "Benchmarking Regional Innovation: A Comparison of Bavaria, Northern Ireland and the Republic of Ireland," ERSA conference papers ersa01p39, European Regional Science Association.
    13. Freel, Mark S., 2003. "Sectoral patterns of small firm innovation, networking and proximity," Research Policy, Elsevier, vol. 32(5), pages 751-770, May.
    14. van Rijnsoever, Frank J. & Hessels, Laurens K. & Vandeberg, Rens L.J., 2008. "A resource-based view on the interactions of university researchers," Research Policy, Elsevier, vol. 37(8), pages 1255-1266, September.
    15. Frank J. van Rijnsoever & Laurens K. Hessels & Rens L.J. Vandeberg, 2008. "A resource-based view on the interactions of university researchers," Innovation Studies Utrecht (ISU) working paper series 08-14, Utrecht University, Department of Innovation Studies, revised Apr 2008.
    16. Hulsink, W. & Elfring, T. & Stam, W., 2008. "The Locus of Innovation in Small and Medium-sized Firms: The Importance of Social Capital and Networking in Innovative Entrepreneurship," ERIM Report Series Research in Management ERS-2008-041-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    17. Carlos M. F-Jardón, 2011. "Deployment of Core Competencies to obtain success in SMEs," Working Papers 1106, Universidade de Vigo, Departamento de Economía Aplicada.
    18. Vega-Jurado, Jaider & Gutiérrez-Gracia, Antonio & Fernández-de-Lucio, Ignacio & Manjarrés-Henri­quez, Liney, 2008. "The effect of external and internal factors on firms' product innovation," Research Policy, Elsevier, vol. 37(4), pages 616-632, May.
    19. Stephen Roper & Nola Hewitt-Dundas & James H Love, 2003. "An Ex Ante Evaluation Framework for the Regional Impact of Publicly Supported R&D Projects," ERSA conference papers ersa03p100, European Regional Science Association.
    20. Stephen Roper & Nola Hewitt-Dundas, 2005. "Assessing the Effectiveness of Innovation Grants – Evidence from the Irish Innovation Panel," ERSA conference papers ersa05p478, European Regional Science Association.
    21. Roper, Stephen & Vahter, Priit & Love, James H., 2013. "Externalities of openness in innovation," Research Policy, Elsevier, vol. 42(9), pages 1544-1554.
    22. Roper, Stephen & Love, James H., 2002. "Innovation and export performance: evidence from the UK and German manufacturing plants," Research Policy, Elsevier, vol. 31(7), pages 1087-1102, September.
    23. Yoke-Tong Chew & Henry Wai-Chung Yeung, 2001. "The SME Advantage: Adding Local Touch to Foreign Transnational Corporations in Singapore," Regional Studies, Taylor & Francis Journals, vol. 35(5), pages 431-448.
    24. Ronde, Patrick & Hussler, Caroline, 2005. "Innovation in regions: What does really matter?," Research Policy, Elsevier, vol. 34(8), pages 1150-1172, October.
    25. Roper, Stephen & Smallbone, David & Vickers, Ian & North, David & Hewitt-Dundas, Nola, 2002. "Innovation and business performance - a provisional multi-regional analysis," ERSA conference papers ersa02p365, European Regional Science Association.

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