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This article is positioned in the debate regarding the relative importance of labour mobility and informal contacts as mechanisms for knowledge diffusion between organisations. Empirically, the article assesses the importance of different knowledge sources utilised by 219 participants in two high-tech, R&amp;D driven, non-incremental, product development projects in large corporations, located in local labour markets highly specialised in their respective industry clusters. The results show that the most important knowledge sources for the respondents are colleagues within the organisation. Informal contacts outside the organisation, although prevalent, are rather unimportant as knowledge sources. External contacts are related to creative contributions in the projects regardless of whether the contributions are selfassessed or peer assessed. However, the support for informal contacts in particular, being related to creative contributions in the projects, is rather weak. Implications for the understanding of knowledge diffusion are discussed and directions for future research suggested.

Labour mobility and informal contacts as mechanisms of knowledge diffusion