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Do External Knowledge Spillovers Induce Firms’ Innovations? Evidence from Slovenia

In: Multinationals, Clusters and Innovation

Author

Listed:
  • Jože P. Damijan
  • Andreja Jaklič
  • Matija Rojec

Abstract

According to new growth theory, technological progress is endogenous and driven by an intentional investment of resources by profit-seeking firms. Still, innovation activities in firms depend heavily on external sources (Fagerberg, 2005). For most countries foreign sources of technology are of dominant importance for productivity growth (Eaton and Kortum, 1999; Keller, 2002). Therefore, economic analysis of innovation recognizes international knowledge flows (through FDI, trade, licensing and international technological collaborations) as important determinants of the development and diffusion of innovations. Here, the notion of technology and knowledge spillovers is central. It is based on theories of endogenous technical change of the early 1990s (Romer, 1990; Grossman and Helpman, 1991; Aghion and Howitt, 1998), claiming that the return to technological investments is partly private and partly public (Keller, 2004). Because of the non-rival character of technology, an innovation that is produced by one firm may also be used by another firm, without incurring very much additional cost (Smolny, 2000). These are technology or knowledge spillovers.

Suggested Citation

  • Jože P. Damijan & Andreja Jaklič & Matija Rojec, 2006. "Do External Knowledge Spillovers Induce Firms’ Innovations? Evidence from Slovenia," Palgrave Macmillan Books, in: Ana Teresa Tavares & Aurora Teixeira (ed.), Multinationals, Clusters and Innovation, chapter 3, pages 27-47, Palgrave Macmillan.
  • Handle: RePEc:pal:palchp:978-0-230-62494-8_3
    DOI: 10.1057/9780230624948_3
    as

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