The paradox of geographical proximity for innovators: A regional study of the Spanish agri-food sector

Abstract

This paper analyses the geographical proximity impact and the proximity paradox in a regional study of the Spanish agri-food industry. This study is mainly based on the Community Innovation Survey database, from which we get a representative group of agri-food companies in Murcia, Spain. The regional character of this research allows us to discount the institutional effects which could cause differences between companies in different regions. In addition, we consider individual innovative actors and alternative innovation outcomes. Our findings corroborate the significant impact of geographical proximity for the innovation in agri-food companies. We get differences between innovators when the geographical impact on absorptive capacities and innovation is examined: geographical proximity between agri-food companies and industrial states and R&D centres has a significant impact on firms’ absorptive capacities whereas geographical distance to large companies and transport facilities play an important role in determining R&D activities. Our results corroborate the proximity paradox for the geographical dimension finding a non-linear relationship for the absorptive capacity in agri-food companies.