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Although recent studies have increased attention on the effects of related and unrelated variety on innovation, a Chinese test has until now been missing from the literature. This paper aims to investigate how related and unrelated variety affect regional innovation in Chinese provinces. In particular, emphasis was placed on differentiating the analysis for the industry and services sectors at a detailed sectoral level.

This paper’s sample is composed of 30 provinces in China from 2003 to 2016. Feasible generalized least squares was used to estimate the effects of related and unrelated variety on regional innovation.

The results show that related variety in all sectors promotes regional innovation, whereas unrelated variety in all sectors does not play a role. In-depth analyses were performed by comparing the industry and services sectors. Only related variety in the industry sector and unrelated variety in the services sector promote regional innovation, whereas unrelated variety in the industry sector exerts a negative effect. After dividing the country into eastern, central and western regions, different findings appear in the sub-samples.

This study contributes to the literature on evolutionary economic geography and innovation by exploring how related and unrelated variety promote regional innovation in a developing country context (China). It also sheds light on the sectoral and regional differences in the influence of related and unrelated variety on regional innovation.

The purpose of this paper is to explain the effects of innovation, specialisation, qualifications and sectoral structure on the resilience of German regions (municipal level) facing the Great Recession in 2008/2009.

To calculate the effects of various variables on the resilience of German regions against the Great Recession, the authors use quantile regressions. To measure resilience, the authors create a number of indexes representing different parts of the economy: resistance performance index, recovery performance index, shift-share resistance index, shift-share recovery index, manufacturing resistance index, manufacturing recovery index, service resistance index and service recovery index.

The results of this study confirm that locations with employment growth before the crisis and with a good industry structure show better employment dynamics during and after the crisis. The authors find evidence for positive relationship between innovativeness, qualification, the share of the service sector, specialisation and resistance. The authors obtain positive results for related variety and both resistance and recovery. The share of the manufacturing sector only shows a positive relationship with recovery.

The authors expand the existing literature in three aspects: First, instead of using regions as observation units, the authors conduct the analyses on the basis of municipalities and their surroundings. By doing so, the authors reduce the modifiable area unit problem because the authors do not rely on regions defined for administrative reasons. Second, the authors apply quantile regressions to detect nonlinear effects. Third, in addition to the resilience of the whole economy, the authors also study the resilience of the manufacturing and service sectors separately and examine the resilience of the local shift effect.

This paper analyses how firm births and deaths are influenced by previous firm births and deaths in related and unrelated sectors. Competition and multiplier effects are used as the theoretical lens for this analysis.

This paper uses 2008–2016 Irish business demography data pertaining to 568 NACE 4-digit sectors within 20 NACE 1-digit industries across 34 Irish county and sub-county regions within 8 NUTS3 regions. A three-stage least squares (3SLS) estimation is used to analyse the impact of past firm deaths (births) on future firm births (deaths). The effect of relatedness on firm interrelationships is explicitly modelled and captured.

Findings indicate that the multiplier effect operates mostly through related sectors, while the competition effect operates mostly through unrelated sectors.

This paper's findings show that firm interrelationships are significantly influenced by the degree of relatedness between firms. The raw data used to calculate firm birth and death rates in this analysis are count data. Each new firm is measured the same as another regardless of differing features like size. Some research has shown that smaller firms have a greater propensity to create entrepreneurs (Parker, 2009). Thus, it is possible that the death of differently sized firms may contribute differently to multiplier effects where births induce further births. Future research could seek to examine this.

These findings have implications for policy initiatives concerned with increasing entrepreneurship. Some express concerns that public investment into entrepreneurship can lead to “crowding out” effects (Cumming and Johan, 2019), meaning that public investment into entrepreneurship could displace or reduce private investment into entrepreneurship (Audretsch and Fiedler, 2023; Zikou et al., 2017). This study’s findings indicate that using public investment to increase firm births could increase future firm births in related and unrelated sectors. However, more negative “crowding out” effects may also occur in unrelated sectors, meaning that public investment which stimulates firm births in a certain sector could induce firm deaths and crowd out entrepreneurship in unrelated sectors.

This paper is the first in the literature to explicitly account for the role of relatedness in firm interrelationships.

The purpose of this paper is to capture the role of internal and external characteristics in favouring the growth of innovative start-ups at an early stage of their life.

The empirical approach of this paper is based on an econometric analysis applied to all Italian innovative start-ups with four and five years of life. Growth is analysed after four and five years from the constitution, depending on internal investments in research and development (R&D), in tangible assets and on characteristics external to the firm (110 Italian provinces) related to industrial variety, specialisation, public investments in R&D, etc.

The results achieved in this study reveal the importance of internal R&D investment even though there is missing evidence on the relevance of general and government specific R&D investment in the area. Other interesting results concern the importance of the firm’s involvement in the technological specialisation of the area and the need for general variety in technological diversification in the area to favour the growth of start-ups.

The results imply that entrepreneurs should evaluate carefully their strategic choices in terms of the location of the start-up and the investment in R&D as these could be important factors for the firm’s growth.

This paper is an original attempt to measure the importance of both internal and external characteristics for the growth of start-ups. Moreover, the analysis covers the overall population of a new interesting category of firm, the innovative start-up.

We address the following research questions: (1) Is the innovation trajectory of the acquirer affected by previous acquisitions? (2) In which direction knowledge recombination from the acquisition is pushed further? (3) Is the technological acquisition more a means for knowledge exploration and radical innovation or, on the contrary, a way for consolidating previous technological specialization?

The nature of this study is exploratory; therefore, we opted for an inductive approach based on the L'Oréal case study analysis. Data were triangulated from different sources: (a) the L'Oréal website and press releases collected in the 2009–2015 period; (b) journal articles and books on the global cosmetics industry and the insightful work of Jones (2010); (c) the Questel Orbit database containing data on patents; and (d) the Zephyr – Bureau van Dijk database containing information on the acquisitions of firms.

Empirical evidence from a patent data analysis reveals a paradoxical path. On the one hand, acquisitions enable the company to explore new technological spaces; on the other hand, they allow it to reinforce a preexisting technological trajectory, even when the knowledge base of the target is distant from that of the acquirer. Thus, in our case study, the absorption and recombination of knowledge from a variety of domains support specialization more than diversification technology strategies.

We add to innovation management literature a new perspective, by offering a detailed analysis, through patent data, of the knowledge recombination process, led by technological acquisitions.

Purpose – The chapter investigates the effects of knowledge on economic growth at the regional level.

Methodology/approach – We elaborate a view on knowledge as the result of a combinatorial search activity and implement indicators synthesizing the network architecture of knowledge structure.

Findings – Empirical estimations corroborate the hypothesis that knowledge coherence and variety, besides the traditional measure of knowledge stock, matter in shaping regional economic performances.

Social implications – Important policy implications stem from the analysis, in that regional innovation strategies, to trigger economic performances, should be carefully coordinated so as to foster exploration strategies, but taking into full account the technological competences accumulated in the course of time.

Originality/value of the paper – The originality of the chapter lies mainly in the methodological approach, which provides operational translation to the view of knowledge as an outcome of a combinatorial search. In this perspective, the chapter also sheds light on previously unexplored aspects of the relationships between knowledge and growth.

The purpose of this paper is to study the relationship between industry risk taking and risk-taking strategy of born-global firms (BGs), and how industry-related variety moderates that relationship.

The authors apply fixed effect model to analyze 26,499 observations on 10,508 BGs in 276 Chinese cities.

The authors find that industry risk taking positively influences risk-taking strategy of BGs, and industry-related variety positively moderates such relationship.

The findings reveal how BGs formulate their risk-taking strategy given the dilemma of risk nature and hurdles in firm establishment and rapid internationalization. This paper extends understanding on BGs’ strategy making, supplements the theoretical framework on BGs with an integrated viewpoint containing “regional–industry–firm” levels and contributes to the industry variety argument.

This paper analyses the impact of institutional proximity, cognitive proximity and geographical proximity (in the form of agglomeration economies) on the firm-level productivity of foreign-owned firms in Ireland. The analysis of agglomeration economies, consisting of internal economies of scale, localization economies, related variety and urbanization economies, has a strong pedigree in regional economics literature. Increasingly, however, alternative explanations of firm-level productivity performance have been explored with institutional and cognitive proximity often identified as other important determinants of performance. This paper presents an analysis of the importance of agglomeration economies (based on geographical proximity) versus institutional and cognitive proximity (which may be a-spatial).

A series of measures capturing regional level agglomeration economies are generated as well as measures of institutional and cognitive proximity. The impact of these effects on foreign-owned firm-level productivity is analysed using data from the Irish Census of Industrial Local Units 2009. The estimation method employed is general method of moments (GMM) which allows for the potential endogeneity of variables within the system of analysis.

The results reveal that institutional proximity has a positive impact on productivity. A possible reason for this result is that local units of the same nationality are sharing knowledge in relation to successfully conducting business in Ireland. However, cognitive proximity is found to be statistically insignificant. Agglomeration economies are also important with urbanization economies and the availability of skilled labour having a positive effect on productivity.

The key contributions of this paper are as follows; firstly, the paper provides the first test of the institutional and cognitive proximity hypotheses on productivity while also controlling for a series of internal and external agglomeration economies. Secondly, the analysis considers, firm level, regional level and national level indicators as determinants of firm's productivity. In combining micro and macro level indicators, the paper attempts to answer the call of Van Oort et al. (2012) for such analyses. Thirdly, the paper provides the first detailed examination of the role of ‘proximity’ on foreign-owned manufacturing firms in the Irish context.

The importance of diversification and innovation in strengthening of global competitiveness has been emphasized in both tourism and local development literature. The aim of this chapter is to define the factors (company type, company size, intra-industry investments, collaboration with other companies, and associations) that influence the product- and service-diversification of hotels. This chapter addresses the diversification and innovation strategies of hotels, not only in the light of tourism literature, but also of local development literature, and it provides empirical evidence based on a company-level survey. The findings of the study show that company type, company size, sector-specific knowledge (intra-industry investments and experience of hotel workers), and collaboration with other companies and institutions matter for product- and service-diversification of hotels.

The purpose of this paper is to present a new methodology to assess the outward connectivity among regional economies in the European Union (EU) and derives policy lessons for the design of regional innovation and competitiveness-enhancing strategic frameworks, with particular reference to research and innovation strategies for smart specialisation (RIS3).

The authors study the network of inter-regional trade flows in the EU25 in the year 2007. Trade data are taken from the PBL Netherlands Environmental Assessment Agency database and mapped onto weighted directed networks in which the nodes represent regions and the links are flows of goods. The authors measure several structural characteristics of the networks, both global properties and centrality indicators describing the position of individual regions within the system.

European regions appear to be mostly integrated in the European single market. Strengths and weaknesses of individual regions are discussed based on rankings obtained from network centrality indicators. Specific policy implications in the context of RIS3 are derived in the case of the Spanish region of Andalusia.

The authors show the potential of the methodology for providing a new family of indicators of the external connectivity of regional economies that can be used by regions wishing to develop their own RIS3 for 2014-2020, as required by the EU in the context of the new cohesion policy framework.

The characteristics of a EU-wide inter-regional network of trade flows are obtained and thoroughly discussed for the first time. A unique and original instrument suitable for inter-regional comparison is developed and tested.