Dynamic Externalities, Universities and Social Capital Formation in the EU Biotechnology Industry



The paper investigates the role of dynamic externalities, university-industry linkages and role of social networking in the biotechnology industry in the European Union (EU). Universities act as platforms for local knowledge spillovers and university-industry cluster development in the biotechnology field. The R&D activities at universities contribute to successful business innovations. However, the relationship between the universities and the local innovation capabilities is much more complex and therefore requires more in-depth analysis. The following study derives from the knowledge of the new economic geography, endogenous growth theory, biotechnology, as well as theories of social capital and social networks. The quantitative research elaborates contemporary literature and databases to find channels of interdependence between local university-based knowledge flows, social capital, and biotechnology cluster performance. The results of the study show that the biotechnology industry relies very much on university-business R&D partnerships and research mobility (e.g. pharmaceutical firms that performed basic research in close cooperation with academia produced more patents). In addition, social networking and informal contacts seem to be a more important for the diffusion of knowledge, especially at the beginning of R&D process, as they allow for building credibility between potential partners.

Full Text:



Aharonson, J., Baum, A.C., and Feldman M.P. (1996). A comparison of the dynamics of industrial clustering in computing and biotechnology. Research Policy, 25(7), 1139-1157.

Audretsch, D.B., and Feldman, M.P. (2004). Knowledge spillovers and the geography of innovation. In V. Henderson and J.F. Thisse (Eds.), Handbook of regional and urban economics: cities and geography (pp.2713–2739). North Holland: Elsevier Science Publisher.

Audretsch, D.B., and Stephan, P. (1996). Company-scientist locational links: the case of biotechnology. American Economic Review, 86(4), 641-652.

Bekkers, R., and Bodas-Freitas, M. (2008). Analysing preferences for knowledge transfer channels between universities and industry. Research Policy, 37(10), 1837-1853.

Bochniarz, Z., and Faoro, K. (2016). The Role of Social Capital in Cluster and Regions' Performance: Comparing Aerospace Cases from Poland and USA. In M. Runiewicz-Wardyn (Ed.), Innovations and emerging technologies for the prosperity and quality of life: the case of Poland (pp.161-179). Warszawa: Wydawnictwo Naukowe PWN SA.

Bratianu, C., and Orzea, I. (2013). Knowledge Strategies in Using Social Networks. Management Dynamics in the Knowledge Economy, 1(1), 25-38.

Breschi, S., Lissoni, F., and Montobbio, F. (2007). The scientific productivity of academic inventors: new evidence from Italian data. Economic Innovation New Technology, 16(2), 101-118.

Coleman, J.S. (1988). Social capital and the creation of human capital. American Journal of Sociology, 94(Supplement), 95-120.

Corelleur, C.D.F., Carrere, M., and Mangematin, V.N. (2004). Turning scientific and technological human capital into economic capital, the experience of biotech start-ups in France. Research Policy, 33(4), 631-642.

European Cluster Observatory (2016). European Cluster Panorama. Retrieved from https://ec.europa.eu/growth/smes/cluster/observatory/cluster-mapping-services/cluster-panorama_en.

European Commission (2012). EU Cohesion Policy 2014-2020. Retrieved on January 28, 2017 from http://www.euractiv.com/section/regional-policy/linksdossier/eu-cohesion-policy-2014-2020/.

European Patent Office (2016). European Patent Convention. Retrieved from www.epo.org/law-practice/legal-texts/.

Fornahl, D., Broekel, T., and Boschma, R. (2010, August). What drives patent performance of German biotech firms?, Paper presented at Evolutionary Economic Geography Conference. Utrecht University, Netherlands.

Gort, M., and Klepper, S. (1982). Time paths in the diffusion of product innovations. Economic Journal, 92(3), 630-653.

Jacobs, J. (1969). The economy of cities. New York: Random House.

Johansson, B. (2005). Parsing the menagerie of network and agglomeration externalities. In C. Karlsson, B. Johansson, and R. Stough (Eds), Industrial cluster and inter-firm networks (pp.107-147). Cheltenham: Edward Elgar.

Ketikidis, P., Siavalas, F., Bota, E., and Solomon, A. (2016, June). Quintuple Helix Co-creation as a Pillar for Responsible Entrepreneurship. Paper presented at the 9th International Conference for Entrepreneurship, Innovation and Regional Development. Bucharest, Romania

Klepper, S. (2006). The evolution of geographic structure in new industries. Revue de l’OFCE, 97, 135-158.

Lemariè, S., Mangematin, V., and Torre A. (2001). Is the Creation and Decelopment of Biotech SMEs Localised? Conclusions drawn from the French Case. Small Business Economics, 17(1-2), 61-76.

Malmberg, A., and Maskell, P. (2002). The elusive concept of localization economies: towards a knowledge-based theory of spatial clustering. Environment and planning, 34(3), 429-449.

McNiven, C. (2007). Overview and discussion of the results of the Pilot Survey on Nanotechnology in Canada. Science, Innovation and Electronic Information Division Working Paper No. 005/2007.

Menzel, M.P., and Fornahl, D. (2007). Cluster Life Cycles - Dimensions and Rationales of Cluster Development. Jena Economic Research Papers 2007, Friedrich-Schiller-University Jena, 76.

Mowery, D.C. (1988). International Collaborative Ventures in U.S. Manufacturing. Ballinger: Cambridge.

Neffke, F., Henning, S., Boschma, R.A., Lundquist, K., and Olander, L. (2009). The dynamics of agglomeration externalities along the life cycle of industries. Regional Studies, 45(1), 49-65.

OECD (2012). Patent statistics 2012. Retrieved from www.oecd.org.

Owen-Smith, J., Riccaboni, M., Pammolli, F., and Powell, W. (2002). A comparison of U.S. and European university-industry relations in the life sciences. Management Science, 48(1), 24-43.

Porter, M.E. (1998). The Competitive Advantage: Creating and Sustaining Superior Performance. New York: Free Press.

Powell, W., Porter, K., and Whittington, K.B. (2005). The institutional embeddedness of high-tech regions: relational foundations of the Boston biotechnology community. In S. Breschi and F. Malerba (Eds.). Clusters, networks, and innovation (pp.261-296). Oxford: Oxford University Press.

Prevenzer, M. (1997). The dynamics of industrial clustering in biotechnology. Journal of Small Business Economy, 9(3), 255-271.

Prevezer, M. (2003). The Development of biotechnology clusters in the USA from the late 1970s to the early 1990s. In G. Fuchs (Ed.), Biotechnology in Comparative Perspective (pp.33-55). New York: Routledge.

Runiewicz-Wardyn, M. (2013). Knowledge Flows, Technological Change and Regional Growth in the European Union. Berlin: Springer.

Swann, G., and Prevezer, M. (2004, June). Industrial Dynamics, Innovation and Development. Paper presented at Elsinore. Denmark.

Todeva, E. (2013). Governance of innovation and intermediation in Triple Helix interactions. Industry and Higher Education, 27(4), 263-278.

Todeva, E., and Rakhmatullin, R. (2016). Global Value Chains Mapping: Methodology and Cases for Policy Makers. JRC Policy Report. European Union. Retrieved from https://ec.europa.eu/jrc.

Van den Berg, L., Braun, E., and van Winden, W. (2001). Growth clusters in European Metropolitan cities. Aldershot: Ashgate.

Van Egeraat, C., and Curran, D. (2010, January). Socio-Spatial Foundations of Knowledge Flow in the Irish Biotechnology Industry and the Role of Digital Ecosystems. Centre for Innovation and Structural Change (CISC) Seminar, NUI Galway.

Vejzagic-Ramhorst, A., Ketikidis, P.H., and Huggins, R. (2012). Social capital, clusters, and interpretive fuzziness: a survey of the key. The International Journal of Innovation and Regional Development, 4(1), 60-78.

Wasserman, S., and Faust, K. (1998). Social Network Analysis: Methods and. Applications. New York: Cambridge.

Zucker, L., Darby, M., and Armstrong, J. (2002). Commercializing knowledge: University science, knowledge capture, and firm performance in biotechnology. Management Science, 48(1), 138-153.


  • There are currently no refbacks.

Copyright (c) 2017 Management Dynamics in the Knowledge Economy

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

© Faculty of Management (SNSPA)

Creative Commons License
This work is licensed under CC BY-NC

The opinions expressed in the papers published are the authors’ own and do not necessarily express the views of the editors of this journal. The authors assume all responsibility for the ideas expressed in the materials published.

ISSN 2392-8042 (online)