Small worlds, inheritance networks and industrial clusters

Mark Bagley

Industry and Innovation, 2019, vol. 26, issue 7, 741-768

Abstract: The performance of firms within industrial clusters has been the subject of a multitude of studies. The organizational attributes inherited by spinoffs from parent firms is one explanation behind performance premiums. This paper examines the relationship between a spinoff’s network and its geographic location in an industrial cluster. We hypothesize that there is a negative relationship between a spinoff’s network efficiency and its distance from the cluster’s centroid. Although recent literature infers that the transmission of knowledge in industrial clusters is accomplished via inherited network ties, this has not been directly measured. This paper aims to fill that research gap. We find that, after controlling for firm size, parent size and age, there is indeed a statistically significant and negative relationship between network efficiency and geographic distance to a cluster’s core.

Date: 2019
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DOI: 10.1080/13662716.2018.1539650

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