Geography Reference
In-Depth Information
The location of certain varieties of i rm in particular places and the specii c knowl-
edge externalities that are generated as a result tend to have self-reinforcing ef ects on
the selection and nature of i rms located in particular spatial economies (Arthur, 1990;
Myrdal, 1957). As a result, regional and urban variety in technological trajectories
are sustained as knowledge specii c to the sectors present spills over primarily among
proximate i rms (Boschma and Frenken, 2006). Spatial proximity remains signii cant
here despite the growing use of ICT because tacit knowledge is attached to individuals
and does not travel easily. Conversely, locations, such as some of those in the north of
England, where knowledge-intensive i rms are thin on the ground, suf er from a lack of
knowledge-rich business environments.
Knowledge spillovers do not take place automatically. They rely on various transfer
mechanisms such as imitation, spin-of s, inter-i rm collaboration, social and professional
networks and labour mobility (Camagni, 1991; Capello, 1999; Boschma and Frenken,
2006; Breschi and Malerba, 2003). There is also a group of sectors whose main function
in the division of labour in the information economy is to monitor, develop, combine
and transfer knowledge. These are knowledge-intensive business services or KIBS. Their
precise dei nition in terms of NACE codes is shown in Appendix 2.
These sectors have grown rapidly since the mid-1980s. Demand for the kinds of
knowledge transfer that they can provide has been driven by the increasingly specialised
requirements of businesses in the information economy. In these circumstances KIBS
are relatively unique in their ability to appropriate and commercialise certain kinds of
knowledge and to transfer them between businesses. They are both a product of the
information economy and one of its distinguishing characteristics.
In many of the traditional sectors of knowledge-intensive services, the new ICT tech-
nological paradigm brought about huge structural changes. Many of these sectors have
been characterised by the combination of previously separate strands of knowledge.
Management consultants, for example, have integrated information and communication
technology consulting services; advertising agencies of er multimedia services; and tech-
nological services such as software i rms provide management consulting. Numerous
new i rms that provide new services that did not exist a few years ago have set themselves
up both within and between the sectors and at the interfaces. There are mainly three
aspects that provide the links between the heterogeneous KIBS sectors and can be seen
as common dei nitional characteristics:
Knowledge is not only a key production factor of the i rms, it is also the 'good'
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they sell. The i rms for the most part provide non-material intangible services.
Specialised expert knowledge, research and development ability, and problem
solving are the real products of KIBS.
The provision of these knowledge intensive services requires in-depth interaction
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between supplier and user and both parties are involved in cumulative learning
processes. These learning processes must occur if a transfer of knowledge or a
problem solution is to succeed. The utilisation of knowledge intensive services
cannot simply be equated with the purchase of standardised external services.
The third important common aspect of all KIBS sectors is that the activity of con-
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sulting, understood as a process of problem solving in which the KIBS adapt their
expertise and expert knowledge to the needs of the client, makes up, to dif erent
