Mellor, Robert B. (2021) Knowledge-sharing in the development of Science and Technology Parks. In: TAKE 2021 : The Knowledge Economy in the Covid-19 Era; 07 - 09 Jul 2021, Porto, Portugal (Held online). (Unpublished)

Abstract

Tech Entrepreneurship is of immense value in regional development and the national economy. Tech Entrepreneurship is partly dependent on economically sheltered environments known as Science and Technology Parks (STPs), who actively seek innovators and also encourage innovation amongst the constituent firms, including by networking and knowledge spill-over between the inhabitants, Universities and sources of capital. The low success rate (~20%) of STPs led us to use the ideas of Stiglitz to investigate how STP architecture can best cope with a changing and challenging innovation environment, through start-up to early maturity and full maturity. Results from using econometric methods (SEM, Monte-Carlo etc) show that it is very beneficial to have a central Cluster Initiative (CI) controlling the decision-making process (“star, hierarchy”) in the early stages of STP development, where potential gains and losses are relatively modest. However in the early maturity stage with commitment to a high-growth trajectory, a high quality of decision–making is required amongst managers and decisions are best taken by the CI with the input of more knowledgeable on-cluster firms. The situation where CI is supported by good-quality knowledge-sharing decisions from on-cluster firms – an ambidextrous situation – is superior when good innovations abound and the STP has acquired some maturity. However, in environments with a surfeit of poor-fit innovations, this becomes a high-risk strategy with high potential losses and indeed in this situation, retaining a hierarchical (CI only) decision process is most helpful, even when the quality of decision–making amongst CI managers is as poor as coin-flipping. To summarise, STP development from small is not linear but Y-shaped: A successful strategy involves the start-up STP attracting enough small innovative firms which – in turn – attract larger firms, whose detailed sector-relevant insight improves CI decision-making. The most valuable ratio includes the CI and only any two of the larger firms; including more decision-makers does not improve the quality of decisions much but does drive the transaction costs up exponentially. If the STP cannot attract larger firms with experienced management, then the STP is best served with the CI continuing alone but, especially under conditions of growth and expansion, the cost of poor decisions will increase until eventually market failure ensues.

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