Knowledge creation and knowledge linkages in the us regions

Abstract

The degree of innovation dynamics of territories depends on their capacity to absorb, transfer and create knowledge. This paper investigates the underlying conditions for knowledge creation in the US regions. Adopting Griliches� (1979) and Jaffe�s (1989) methodology, this paper presents the results of the estimation of a simultaneous equation model which draws on Griliches (1979) knowledge production function to test the efficiency of the inter-linkages between university and industry in the US regions. The results suggest that the knowledge creation process across US regions depends significantly on a highly qualified labour force, employment in high-tech industries, the geographical concentration of the manufacturing industry and positive university-industry R&D interaction. The results further suggest that government R&D funding can crowd out private industry investment in R&D.