High-tech clusters, technology spillovers, and trade secret laws

Arbeitspapier

We analyze firms’ incentives to cluster in an industrial district to benefit from reciprocal technology spillovers. A simple model of cumulative innovation is presented where technology spillovers arise endogenously through labor mobility. It is shown that firms’ incentives to cluster are the strongest when the following three conditions are met: 1) technological progress is rapid; 2) competition in the product market is relatively soft; 3) the probability of a single firm to develop an innovation is neither very high nor very low. We show that some trade secret protection is always beneficial for firms’ profits and stimulates clustering. Excessive protection may impede technology spillovers and reduce firms’ incentives to cluster.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working paper ; No. 7-2002

Classification and Topics

• Classification: Wirtschaft ; Wages, Compensation, and Labor Costs: General ; Regulation and Business Law: General ; Market Structure, Firm Strategy, and Market Performance: General ; Management of Technological Innovation and R&D ; Intellectual Property and Intellectual Capital
• Subject: Cumulative innovation ; industrial districts ; intellectual property rights ; technology spillovers

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fosfuri, Andrea ; Rønde, Thomas
• Event: Veröffentlichung
• (who): Copenhagen Business School (CBS), Department of Economics
• (where): Frederiksberg
• (when): 2002

Further information

• Handle: http://hdl.handle.net/10419/208456
• Last update: 10.03.2025, 11:43 AM CET