Influence of accessibility on innovation - Empirical study of electronics industry in northern Taiwan

Knowledge capital promotes innovation in production, management, and marketing; decreases costs; and increases benefits, quality, and sales growth. Increasing numbers of firms are establishing links with educational and research institutions (ERIs) to accumulate knowledge capital. Such links generate knowledge spillover: firms located near ERIs can enhance innovation through spatial knowledge externalities. Accessibility to ERIs, its effects on innovation in the electronics industry, and the role of transportation infrastructure in the development of knowledge-based economies were studied. The study samples analyzed by multiple regression models were located in northern Taiwan between 1996 and 2001. The empirical evidence supported the following conclusions: (a) improved accessibility to ERIs significantly enhanced innovation, (b) the effects of enhanced innovation were significant within a distance limitation of 20 to 30 km from ERIs, (c) accessibility to universities creates more effects than does accessibility to research institutions, and (d) the effects of ERIs on innovation in metropolitan areas were less significant than were those in nonmetropolitan areas. Empirical evidence showed that integrating the policies of industry, education, and transportation is essential for stimulating further innovation in the electronics industry.