Driving the Knowledge Economy: Explaining the Impact of Regional Innovation Capacity on Economic Performance

Abstract

The knowledge economy represents an intangible economic configuration whereby knowledge is valued as a key factor in production. Economic growth in leading world economies is increasingly based on knowledge, in addition to tangible assets such as capital and labor. Knowledge work involves creation, and can therefore be operationalized by innovation for empirical analysis. Under this definition, this study looks at the innovation capacities across all metropolitan regions in the U.S., and the extent to which they determine economic growth in these regions. Using industry data on U.S. metropolitan regions from 1988 to 2007, the research findings show that the impact of innovation capacity on economic growth has significantly increased after the dot com era. However, the magnitude of increment was small. This can be explained by the wide variations in the U.S. in industry bases, and their regionspecific contextual factors. To explain these findings, the study concludes with a literature review on a contextual approach to study the economic impact of innovation capacity on a region's economic performance. The researcher proposes taking a more focused and less aggregated approach to study and compare regions, so as to account for various contextual factors. [ABSTRACT FROM AUTHOR] Copyright of Contemporary Management Research is the property of Academy of Taiwan Information Systems Research and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)