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KNOWLEDGE IMPACTS OF UNIVERSITIES ON INDUSTRY AN AGGREGATE SIMULTANEOUS INVESTMENT MODEL *
Author(s) -
Florax Raymond,
Folmer Henk
Publication year - 1992
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.1992.tb00199.x
Subject(s) - investment (military) , production (economics) , aggregate (composite) , diffusion , industrial organization , identification (biology) , function (biology) , knowledge production , econometrics , human capital , economics , markov chain , business , microeconomics , computer science , knowledge management , economic growth , political science , materials science , physics , botany , evolutionary biology , machine learning , politics , biology , law , composite material , thermodynamics
. This paper is concerned with the impacts of academic knowledge production (human capital, research, and consultancy) on the investment behavior of the manufacturing industry. Beginning with the neoclassical theory of capital accumulation, a multiregional investment model for non‐residential structures and equipment is developed. Within this model, the knowledge impacts of universities are represented by a diffusion function, which takes into account the possibilities of contagious and hierarchical diffusion of knowledge. Special attention has been given to the development of a theoretically sound and empirically operational investment model, and to the identification of spatio‐temporal correlation. The latter has been approached by means of the use of an EGLS estimator, based on a stationary spatio‐temporal Markov scheme for the residual. The main result of the case study relating to the Netherlands is that academic knowledge production has a significant positive impact on investments in equipment which is strongest in the neighborhood of central places (i.e., following a hierarchical diffusion pattern).