Geography Reference
In-Depth Information
Such evolutionary processes of social or technical innovation, selection, and retention
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often produce what Spender (1996) has labeled 'automatic knowledge'. Those who
possess it know little or nothing of its origin or how they have come to know it, but they
know how to use it and they can see that it works.
Experience alone does not guarantee any local or general increase in the stock of
knowledge, however. On the contrary, stagnation may be a stable condition and the
'solutions to some surprisingly simple technical problems appear to have eluded produc-
ers despite centuries of repetitive activity' (Young, 1993, p. 444). Wrong conclusions may
be drawn by misinterpretation of the facts at hand (Loasby, 1991), and can even become
widely dispersed.
Even if individuals and i rms get things right in the i rst place, they do not always stay
that way. Circumstances change and routines that work well at one point in time may
later become outdated. Routines tend to be durable, however. They are often retained and
defended by actors with vested interests long after changes in the external conditions have
made them redundant (Demsetz, 1988). It is thus dii cult to unlearn successful habits of
the past, even in cases where it is obvious to everyone concerned that they hinder future
success (Hedberg, 1981). Firms may i nd themselves in lock-in situations for long periods,
until some entrepreneurial actor, inside or outside the i rms in question, unrestrained by
the dominant disposition, breaks the spell by introducing new ways of doing things.
Research in cognitive psychology addresses the behavioral drivers and constraints
at the micro level, especially concerning human judgment and decision-making under
uncertainty. There seems to be a general set of biases in individuals' search among the
wide range of opportunities in their external environment (Simon, 1947 and Tversky and
Kahneman, 1974). Bounded rationality, sometimes reinforced by attributes of problem
architectures and misaligned incentives, makes individuals concentrate their search on a
restricted range of potential alternatives (March, 1991; Ocasio, 1997). Local, exploitive
search, that is, looking for answers close to already existing solutions while utilizing
existing routines, is preferred even in situations when the possible higher search costs of
following many dif erent paths simultaneously or pursuing a more global search strategy
is more than balanced by the potential benei ts of acquiring a broad variety of knowledge
inputs (Jensen and Meckling, 1976; Simon, 1987; Tversky, 1972).
Elsewhere, we have used the term 'functional myopia' to denote this form of restricted
search for knowledge and solutions (Maskell and Malmberg, 2007) and noted that it has
an interesting corresponding spatial aspect (Levinthal and March, 1993). The concept of
localized learning (Malmberg and Maskell, 2006; Maskell and Malmberg, 1999) has been
coined to demonstrate how some processes of interactive knowledge creation, acquisi-
tion and exchange tend to be if not exclusively so at least in some central respects
local in
character. Despite modern developments in transport and communications technology
that make long-distance interaction easier and cheaper, certain types of information and
knowledge exchange continue to require regular and direct face-to-face contact (Storper
and Venables, 2004; and see Gof man, 1967). Everything else being equal, knowledge
search and exchange processes will usually be less costly and smoother, the shorter the
physical distance between the participants. Also social ai nity, cultural community and
cognitive proximity tend to follow from spatial proximity (Gertler, 1995). In this sense,
processes of localized learning are inherent in the everyday life of people working - and
living - in any local setting.
