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We investigate econometrically whether cultural diversity at the workplace boosts innovation. Our longitudinal linked employer-employee data combines two innovation surveys, with Dutch administrative, tax and regional data. We analyse the determinants of a firm's product and process innovations with respect to the firm's internal resources, employee composition and regional agglomeration externalities. We reconfirm the findings of several other recent studies showing a positive partial correlation between innovation and cultural diversity in pooled cross-sectional data; in some cases even when accounting for reverse causation. However, no statistically significant traces of benefit for innovation from cultural diversity remain after introducing firm fixed effects. [ABSTRACT FROM AUTHOR]

A key assumption in agglomeration theory is that knowledge-based firms benefit from knowledge spillovers in cities. Cities however may have different locations in the national context, such as embedded in a network of nearby cities or relatively isolated. We examine social networks employed by university spin-off firms in urban environments that contrast in such a way, namely, Delft (the Netherlands) and Trondheim (Norway). A set of growth models is explored with a focus on characteristics of social networks through which knowledge is acquired, such as tightness, strength and spatial orientation. The networks appear to differ in various respects, except for a positive influence on growth of heterogeneity in the social background of partners. The largest difference is observed in strength of relationships: an increase in strength tends to hamper growth in Delft, while it tends to enhance growth in Trondheim. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to open the ‘black box’ of knowledge spillovers by testing the extent to which social interactions between firms in a region positively contribute to firm performance. Specifically, we examine the Marshall-Jacobs controversy, a debate over whether these spillovers occur across firms operating in similar or dissimilar fields. Our empirical examination of the debate relies on a dataset that is constructed from three sources: firm-level data of 1,881 high-tech firms in all 40 Dutch regions, regional economic data and network data constructed from the membership registrations of all business associations in a sample of 11 regions. The results show that the total amount of regional network activity has no effect on individual firm performance; however, participation in local business networks does support firm employment growth. With regards to the Marshall-Jacobs controversy, the results show that having local links to other high-tech firms is conducive to a firm's employment growth, while links to other types of firms provided no such lift. [ABSTRACT FROM AUTHOR]