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Linked versus Non-linked Firms in Innovation: The Effects of Economies of Network in Agglomeration in East Asia
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Abstract
This paper proposes a new mechanism linking innovation and network in developing
economies to detect explicit production and information linkages and investigates
the testable implications of these linkages using survey data gathered from manufacturing firms
in East Asia. We found that firms with more information linkages tend to innovate more,
have a higher probability of introducing new goods, introducing new goods to new markets
using new technologies, and finding new partners located in remote areas. We also found
that firms that dispatched engineers to customers achieved more innovations than firms that
did not. These findings support the hypothesis that production linkages and faceâ€toâ€face
communication encourage product and process innovation.Southeast Asia, East Asia, Technological innovations, Network, Communication, Business enterprises, Engineer Mobility, Innovation, Linkages