University-related science parks - 'seedbeds' or 'enclaves' of ...

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D. Felsensteintechnological prowess and innovation prompted by science park location, this latter factor can servesupply-push conditions.to entrench existing seedbed interactions.The complete system of these interrelationships The question now arises as to whether otheris examined more formally in the log-linear model. factors exist that could impact on location. AreThe reduced-form model of the relationships other seedbed-promoting processes related to scibetweenW, I and L takes the formln(M,iJ = (Y + YWi t YZj + rWZij(18*18/l) (853/l) (4.5411)(i,Z, k = 1,O)+ YWZLij~(8*14/l)where ln(Mij,) = the expected cell frequency, OL= overall mean of the log of expected cellfrequencies, yWi = effect attributable to theith category of work experience, YZj = effectattributable to the jth category of innovation level,YWZij = effect attributable to the interactionbetween the ith category of work experience andthe jth category of innovation level, and YWZL,,= effect attributable to the third-order interactionbetween the ith category of work experience, thejth category of innovation and the kth category oflocation.Figures in parentheses are chi-square statisticsand degrees of freedom, all significant at thep < O-05 level.Likelihood ratio chi-square value for estimatedmodel = 5.76 (p = 0.0461,3 degrees of freedom).The results show that only one second-orderand one third-order interaction term are significant.Both these terms express the interaction effectsof work experience with innovation. There wouldthus seem to be an information flow basedon employment background that is related toinnovation level. This also interacts with location,suggesting that while work experience is relatedto innovation this may be contingent on location.However, this latter three-way interaction is theonly way in which location shows up in the results.All the two-way interactions that include locationare not ‘significant, and even the direct effect ofscience park location by itself is not included inthe model. All this would seem to imply that whilethe seedbed effect is not necessarily contingent onence park location? As noted earlier, the spin-offprocess is often associated with spatial clustering,the assumption being that spin-off firms remain inthe local area once they have broken away andcontinue to interact formally (e.g. subcontracting)or informally (social exchange) with their formerplaces of employment [49].Amongst the firms surveyed, the pattern ofspin-off was distributed across: (1) local firms,both Israeli and local foreign subsidiaries (36%of firms attributable to this source); (2) foreigncompanies abroad (22%); (3) universities (nearlyall local) (26%); and (4) the defence industry(including former army officers) and a ‘miscellaneous’category (16%). This distribution highlightedthe relatively large number of firms thathave spun-out of foreign companies abroad. Workexperience abroad would seem to expose thepotential entrepreneur to the possibilities of settingup an independent operation. It could also be thatnew firms starting up in this way have a guaranteedmarket in the form of their former company. Thismitigates some of the risk generally involved inspinning-off [49].A significant relationship is found to existbetween spin-off (P) and science park location(L) (x2 = 4@07, p = 0X)451). However, whenstratifying the relationship between innovationand location by type of spin-off, no significantrelationship exists. This would seem to show thatthe (rather weak) relationship between innovationand location, outlined above, is not contingent onthe type of spin-off. Thus, unlike the case forwork experience, we cannot conclusively say thatformer companies are an apparent source of inputthat will influence the firm’s innovation level. Assuch, there does not seem to be any reasonfor conscious science-park clustering of spin-offsaround ‘incubator’ organizations. They might clusterdue to inertia, prestige considerations associatedwith the location or simply through lack of106 Technovation Vol. ?4 No. 2
Science parks - seedbeds or enclaves of innovation?information about alternative locations. However,we have little evidence to suggest that they clusterfor information and interaction purposes or that theincubator organization is an inherent component ofthe seedbed effect. In addition, the surprisinglyhigh number of spin-offs attributable to foreignfirms, thereby discounting the option of locationalclustering around incubators, would seem to supportthis contention.Type of market (M) (export or local) washypothesized as exerting an influence on innovationlevel. Here we address the issue of whether firmswith similar markets are likely to choose a sciencepark for its seedbed effect. On the basis offirms surveyed, there is no evidence of a directrelationship between science park location (L) andmarket orientation (M). However, the relationshipbetween type of location and innovation level isagain mediated by type of market. Thus, for firmsoperating in local markets this relationship exists(x2 = 6.397, p = O-012), while it is not apparentfor firms serving export markets. In view of therelationship between market and innovation level,this might suggest that for those firms operatingin local markets science park clustering as aninteraction strategy is more important than forfirms operating abroad. The latter probably havealternative information networks connected withtheir markets and are thus less contingent on thescience park and its seedbed effects.7. ConclusionsThis paper has examined the case for theexistence of seedbed conditions on science parksthat promote innovation. The basic questions thatthe paper attempts to answer are, first, whetherthese effects are an important input to the firm’sinnovation level and, second, the extent to whichthese effects are contingent on the physical proximityand clustering afforded by the science park.The evidence seems to indicate that the informationflows and knowledge networks associatedwith university interaction and an entrepreneur’seducation level do not necessarily translate intoinnovation. We suggest that the influences oninnovation might lie somewhere else: in bothsupply conditions (such as the work experience ofthe entrepreneur) and the structure of demand(market conditions). Thus, the results presentedin this paper provide further support for theargument in much of the business literature to theeffect that technical knowledge without businessskill does not necessarily make for innovativelysuccessful products or firms [l, 2, 501. To this wemust add that the particular nature of hightechnologymarkets (competition, imperfect knowledgeat the early stages and high barriers to entryat later stages) also means that the informationnetworks likely to arise on the basis of universityinteraction and educational level are not necessarilythose needed for innovation (in contrast toinvention).The ‘seedbed’ hypothesis, that forms the centralfocus of this paper, is supported only undercertain conditions. In common with other empiricalevidence [6, 35, 39, 401, the level of interactionbetween firms located on science parks and localuniversities is generally low. It is higher, however,than the level of interaction exhibited by companiesthat are not science park tenants. This of itself,however, is no indication of a seedbed effectarising from science park location. Testing thisproposition more directly, we find that thelocation-innovation connection is strengthenedwhen stratified by work experience. This wouldseem to indicate that science park location, ratherthan being seedbed-inducing, could be seedbedentrenching.In common with other studies, wehave suggested that the choice of a science parklocation is due as much to the status and prestigeeffect that these exclusive locations confer [5, 11,351, as it is to the perceived benefits in termsof innovative edge. Science park location couldtherefore be the outcome of a process of ‘socialsignalling’ and ‘swarming’ [ 171.The policy implications of these findings suggestthat alternative vehicles for technology transfer,university-industry interaction and inter-firm flowsof information and materials need to be developed.Universities are slowly beginning to developTechnovation Vol. 14 No. 2 107
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