Mind the Gap: The Reverse Spillover of Knowledge and its Impact on Innovation Performance

Abstract

This study demonstrates the impact knowledge spillover and knowledge exploitation by external collaborators has on the innovation performance of UK firms across different geographical proximities and industries (knowledge intensive business services (KIBS); high-tech manufacturing; Information and Communication Technologies (ICT); creative industries). Our main focus is on the reverse knowledge spillovers of innovation. Traditionally this issue has presented a challenge for International Business (IB), geography of innovation, management literature, in terms of firstly identifying the phenomenon and secondly in measuring it. We use a multi-level mixed effect generalised linear model to test our hypotheses, controlling for time, regional and firm unobserved characteristics. Our sample includes 19,510 observations and 17,859 firms, with a small panel element of 1,651 firms mainly from the UK Innovation survey and Business registry. We demonstrate that external collaboration may become a significant advantag...