Journal of Economic Geography - current issue

Mobility of skilled workers and co-invention networks: an anatomy of localized knowledge flows

Breschi, S., Lissoni, F. — 2009-06-17

This article illustrates the contribution of mobile inventors and networks of inventors to the diffusion of knowledge across firms and within cities or states. It is based upon an original data set on US inventors’ patent applications at the European Patent Office, in the fields of drugs, biotechnology and organic chemistry. The study combines the methodology originally proposed by Jaffe et al. (1993, Quarterly Journal of Economics, 108: 577–598) with tools from social network analysis, in order to evaluate extent of the localization of knowledge flows, as measured by patent citations. After controlling for inventors’ mobility and for the resulting co-invention network, the residual effect of spatial proximity on knowledge diffusion is found to be greatly reduced. We argue that the most fundamental reason why geography matters in constraining the diffusion of knowledge is that mobile researchers are not likely to relocate in space, so that their co-invention network is also localized. In the light of these results, we revisit common interpretations of localized knowledge flows as externalities.

The emerging market for intellectual property: drivers, restrainers, and implications

Monk, A. H. B. — 2009-06-17

The rise of the knowledge economy has ushered in important changes to the economic landscape. One such change is the emergence of a market for intellectual property (IP), and more specifically a market in patents. New corporate IP strategies are driving the development of this IP market; specialized patent intermediaries, located predominantly in Silicon Valley, are facilitating its growth. Given the relevance of this phenomenon for economic geography, this article seeks to map this emerging market and illustrate its drivers, restrainers and implications. Despite its infancy, the patent market is drawing comparisons to the market for financial derivatives. It has the potential to change the economic landscape in a way that permanently alters corporate and regional competitive dynamics.

Life on the edge: navigating the competitive tensions between the 'social' and the 'economic' in the social economy and in its relations to the mainstream

Hudson, R. — 2009-06-17

Drawing on detailed empirical research in the UK, in this article I explore the motivations that lie behind the formation of social economy organisations (SEOs) and the multiple trajectories that these can then follow and the tensions to which this can give rise as the ‘social’ runs up against the ‘economic’. This can, and often does, involve competition between SEOs in limited local markets and in search of state grant income. For those that seek to transcend these limits, the tensions between the ‘economic’ and the ‘social’ can become acute, especially in those that seek to become self-consciously near-market social ‘enterprises’, with a growing focus upon their economic role and contribution and trading as the route to growth. This typically leads them into competition with firms in the mainstream capitalist economy, engendering tensions between the need to survive in competitive markets and the ethical and social motivations that informed their original formation. I then consider broader questions as to imaginaries about the social economy and of how the social economy is seen in the policy and academic literatures in terms of its socio-economic role. Finally, I offer some reflective comments as to the future for SEOs and the social economy and their contribution to social and economic life.

Financing internationalisation: a case study of an African retail transnational corporation

Okeahalam, C. C., Wood, S. — 2009-06-17

Economic geographers are directing increasing attention to international expansion by leading retail transnational corporations (TNCs). However, there has been minimal examination of the financing methods of these firms and, while the major retail TNCs have supply relationships in sub-Saharan Africa, so far none have opened stores on the continent. Therefore, in this article we analyse expansion into sub-Saharan Africa by a second tier retail TNC (Shoprite) and explore its financing strategy. We find that the food retail sector in sub-Saharan Africa is experiencing strong growth with high financial returns. We identify a pecking order to financing the firm—with a preference for internal funding through retained earnings preceding long-term debt, and limited issuance of equity as a last resort. Given the efficiencies of debt financing, this preference is interpreted as reluctance to dilute returns to shareholders and as a pragmatic approach to financing expansion in ‘particularistic’ business environments.

Plants' self-selection, agglomeration economies and regional productivity in Chile

Saito, H., Gopinath, M. — 2009-06-17

In this study, we assess the relative contribution of plants’ self-selection and agglomeration economies to a region's productivity level. We focus on manufacturing plants by region in the Chilean food industry, which is not only a major source of employment and exports but also spatially dispersed. Our estimation of plant-level productivity corrects for possible simultaneity between productivity and conventional inputs and plants’ self-selection to locate in specific markets. Moreover, we account for three sources of externalities: localization, urbanization and demand-driven scale economies in our estimation. Then, a censored regression model relates regional productivity-distribution measures to agglomeration economies. We find that high-productivity (exporting) plants locate in a region where other plants in food industry agglomerate, industrial structure is diversified and market size is large. Our results suggest that plants’ self-selection outweighs the contribution of agglomeration economies in increasing a region's productivity level.

Why an economic core: domestic transport costs

Ramcharan, R. — 2009-06-17

What determines the spatial distribution of economic activity? And why is economic activity sometimes ‘lumpy’, distributed in a core-periphery pattern in some countries? This article uses new subregional data on the spatial distribution of economic activity for a large cross section of countries, as well as information on roads, rails and surface topography to help understand the role of domestic transport costs in shaping economic geography. The evidence suggests a significant role for physical geography and transport costs in determining the location of economic activity. Countries with rougher surfaces have less developed road and rail transport networks, and greater spatial concentration of economic activity.

World Development Report 2009: reshaping economic geography

Scott, A. J. — 2009-06-17