Abubakar, Yazid Abdullahi (2014) The growth of small firms in non-cluster regions: what knowledge factors matter? In: 13th International Entrepreneurship Forum (IEF): Entrepreneurship and Development: The Idea of Inclusive Opportunity Creation; 31 Jul - 02 Aug 2014, Bogota, Colombia. (Unpublished)

Abstract

Although it has been suggested that knowledge spillovers have significant consequences for small firm performance especially in Clusters, past empirical findings have largely ignored the question of whether knowledge spillovers also matter for small firms in Non-Clustered regions. Extending previous research, this paper analysis the impact of different types of knowledge spillover mechanisms on small firm performance in Non-Clustered regions. The paper argues that due to the greater disadvantage of Non-Clustered small firms in accessing local knowledge resources from research intensive universities and dearth of geographically proximate firms, growth performance of Non-Clustered firms will be specifically significantly influenced by ‘imitation of non-local firms for product development’. Based on a survey of Non-Clustered and Clustered (as control group) technology-based small firms in the East of England, and controlling for several factors, the findings suggest that: imitation spillovers have a significant positive impact on employment growth of small firms in Non-Clustered regions. The suggests that Non-Cluster small firm’s boosts their ability to generate for new products that influence their growth through the imitation of non-local competitors. Key policy implication is that: while policies for promoting small firm growth performance through university research appear to be appropriate for Clustered regions, Non-Clustered regions may need to adopt somewhat different policies that allow small firms to imitate technologies of others though appropriate legal means.

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