Proximity and its impact on the formation of product and process innovation networks among producer firms

Abstract

ABSTRACT Informal networks among manufacturing firms play an important role in the transfer of knowledge in industrial clusters. Proximity facilitates the networking process; however, empirical evidence on the relationship between multiple proximity dimensions and different kinds of innovation networks is scarce, especially in developing economies. Using multiple regression quadratic assignment procedures (MRQAP), this paper studies the relationship between four proximity dimensions and innovation networks for new product and new process innovations in the Lahore textile cluster in Pakistan. Our findings suggest that both geographical and non-geographical proximity dimensions show a distinct impact on product and process innovations networks.