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Innovation, knowledge and relations – on the role of clusters for firms’ innovativeness

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  • Judith Terstriep
  • Christian Lüthje

Abstract

For more than two decades, theories on regional clusters have inspired economic and structural policies at the European, national and regional levels. Based on the assumption that clusters generate innovation, policy-makers at all levels of governance have adopted instruments and mechanisms to stimulate, resource and sustain clusters. Despite the considerable attention paid to the clustering phenomenon, empirical evidence on to what extent firms’ innovation activities benefit from operating in clusters is scarce and inconclusive. This paper contributes to the micro-foundation of clustering effects by examining the characteristics and activities of cluster firms in relation to their innovativeness. Bridging innovation, management and cluster theories, it is argued that structural and relational embeddedness, relational capital and absorptive capacity influence clustered firms' innovativeness. Partial least-squares structural equation modelling of data from 104 firms in two software and information technology service sector clusters reveals that firms’ structural embeddedness (i.e. frequency of interactions) in clusters and external networks facilitates innovation cooperation. Firms’ absorptive capacity reinforces this positive effect of cluster-internal interactions on innovation cooperation. Results also suggest a substitution effect of trust as relational control mechanisms for formal control mechanisms within the cluster. However, the study finds no significant impact of firms’ innovation cooperation within the cluster (i.e. relational embeddedness) on their innovation success.

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  • Judith Terstriep & Christian Lüthje, 2018. "Innovation, knowledge and relations – on the role of clusters for firms’ innovativeness," European Planning Studies, Taylor & Francis Journals, vol. 26(11), pages 2167-2199, November.
  • Handle: RePEc:taf:eurpls:v:26:y:2018:i:11:p:2167-2199
    DOI: 10.1080/09654313.2018.1530152
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    Cited by:

    1. Rafael Morais Pereira & Ana Cláudia Azevedo & Fabio Emanuel Farago & Felipe Mendes Borini, 2024. "Technological intensity and local socio‐economic development," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(2), pages 1043-1057, March.
    2. Geetika Jain & Archana Shrivastava & Justin Paul & Ronak Batra, 2022. "Blockchain for SME Clusters: An Ideation using the Framework of Ostrom Commons Governance," Information Systems Frontiers, Springer, vol. 24(4), pages 1125-1143, August.
    3. Liping Fu & Fan Wu & Shan Zhang, 2022. "Evolutionary Path and Innovative Development of Pharmaceutical Industrial Cluster—A Case Study of Shijiazhuang, China," IJERPH, MDPI, vol. 19(5), pages 1-18, March.
    4. Nils Grashof & Dirk Fornahl, 2021. "“To be or not to be” located in a cluster?—A descriptive meta-analysis of the firm-specific cluster effect," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 67(3), pages 541-591, December.

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