SPECIALISATION, DIVERSITY AND GEOGRAPHICAL DIFFUSION OF KNOWLEDGE

The paper seeks to develop our understanding of the somewhat diffuse nature of technological externalities in technological space by associating a geographical dimension with the sectoral dimension. Using panel data this paper estimates a knowledge production function that allows for spillovers inside the same industry and outside, and for local as well as global geographical spillovers. This allows to test wether inter-sectoral externalities would be more favoured by geographical proximity, while intra-sectoral externalities would be produced more easily at a distance. The results confirm this hypothesis for the French case, since Jacobs externalities decrease more drastically with distance than MAR externalities.