Industrial Spatial Coagglomeration, Knowledge Spillovers, and Innovation Performance: Discussion on the Construction Pathways for Regional Industrial Diversification Clusters

Abstract

Can the geographical proximity of an industry to the “technological knowledge pool” outside its own sector effectively enhance its innovation performance? Are there differences in the effects brought about by geographical proximity based on different types of linkages? Under the framework of the knowledge production function, this paper empirically examines the innovation performance enhancement effect of differentiated technological knowledge pools formed by directional industrial spatial coagglomeration, using data from the industrial enterprise database and patent database. The findings reveal that the level of industrial innovation is positively influenced by the diverse technological knowledge pools generated through industrial spatial coagglomeration. This conclusion remains valid even after addressing potential endogeneity issues by employing the UK’s industrial coagglomeration index as an instrumental variable. In particular, knowledge spillovers serve as the primary mechanism through which industrial coagglomeration is influenced by technological knowledge pools from outside its own sector. The innovation spillover effect of active coagglomeration is significantly greater than that of passive coagglomeration, and the impact of technological knowledge pools on the scale of industrial innovation is slightly stronger than on the quality of innovation. Further research indicates that only active coagglomeration between industries with input- output linkages can significantly enhance the innovation capabilities of both industries, while industrial coagglomeration with technological linkages demonstrates a notable “parasitic effect.” The policy implications of this paper suggest that local governments should thoroughly consider the spatial dependency relationships and historical patterns of inter-industry location selection when developing regionally diversified industrial clusters. Simultaneously, they should strengthen intellectual property protection and industry regulation to achieve high-quality development of regional industries.

Keywords

industrial spatial coagglomeration / technological knowledge pool / knowledge spillovers / innovation improvement / industrial cluster development

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Higher Education Press