Cluster Relationships, Knowledge Flows, and Technical Innovations: An Exploration Study of Mold & Die Industry in Northern Taiwan

International Journal of Economics and Management Studies

© 2019 by SSRG - IJEMS Journal

Volume 6 Issue 11

Year of Publication : 2019

Authors : Shin-Tien Chen

10.14445/23939125/IJEMS-V6I11P110

How to Cite?

Shin-Tien Chen, "Cluster Relationships, Knowledge Flows, and Technical Innovations: An Exploration Study of Mold & Die Industry in Northern Taiwan," SSRG International Journal of Economics and Management Studies, vol. 6,  no. 11, pp. 89-99, 2019. Crossref, https://doi.org/10.14445/23939125/IJEMS-V6I11P110

Abstract:

Knowledge flows drive the formation of industry clusters; however, the smoothness of knowledge flow hinges on the patterns and clustering of the
manufacturers in the industry, which in turn affects technical innovations. To clarify the relationship among cluster relationships, knowledge flows, and technical innovations, this paper examines the mold & die manufacturers in Sanchong, Xinzhuang, and Shulin districts in northern Taiwan. Data regarding an effective sample of 282 mold &die companies is collated via interviews. The empirical study indicates that; (1) there is no significant correlation between vertical collaborations and technical innovations. There is significant negative correlation between horizontal competition and technical innovations. Resource sharingand technical innovations are significantly and positively correlated; (2)knowledge flows and technical innovations are significantly and positively correlated; (3) the greater the horizontal competition, the weaker the knowledge sharing, and hence, the fewer the technical innovations; (4) the greater the resource sharing, the better the knowledge flows, and then the stronger the technical innovations. These findings have profound managerial implications.

Keywords:

Resource Sharing, Industry Cluster, Knowledge Flow, Technical Innovation, Mold &Die Industry

References:

[1] Anderson, G. (1994). Industry clustering for economic development, Economic Development Review, 12(2), 26-32.
[2] Arimoto, Y., Nakajima, K. and Okazaki, T. (2014). Sources of productivity improvement in industrial clusters: The case of the prewar Japanese silk-reeling industry. Regional Science and Urban Economics, 46(1), 27-41.
[3] Audretsch, D. B. and Feldman, M. P. (1996). R & D spillovers and the geography of innovation and production, America Economic Review, 86(3), 630-645.
[4] Avolio, B. J., Yammarino, F. J., and Bass, B. M. (1991). Identifying common methods variance with data collected from a single source: An unresolved sticky issue, Journal of Management, 17(3), 571-587.
[5] Baptista, R. and Swann, P. (1998). Do firms in cluster innovate more, Research Policy, 27(5), 525-540.
[6] Bell, S. J., Tracey, P., Jan B., and Heide, J. B. (2009). The organization of regional clusters, Academy of Management Review, 34(4), 623-642.
[7] Breschi, S. and Malerba, F. (2001). The geography of innovation and economic clustering, some introductory notes, Industrial and Corporate change, 10(4), 817-833.
[8] Carroll, G. R. and Hannan, M. T. (1995). Automobile manufacturers, in Carroll, G. R. and Hannan, M. T. (eds), Organizations in industry, 195-214, Oxford University Press, New York.
[9] Carroll, G. R. and Swaminathan, A. (2000). Why the microbrewery movement? organizational dynamics of resource sharing in the American brewing industry, American Journal of Sociology, 106(3), 715-762.
[10] Carroll, G. R. Dobrev, S. D. and Swaminathan, A. (2003). Organizational processes of resource sharing, research in organizational behavior, New York, JAI/ Elsevier.
[11] Cohen, W, M. and Levinthal, D. A. (1990). Absorptive capacity, a new perspective on learning and innovation, Administrative Science Quarterly, 35(1), 128-152.
[12] Cooke, P. (2001). Regional innovation systems, clusters and the knowledge economy, Industrial and Corporate Change,10(4), 945-974.
[13] Dobrev, S. D. (2000). Decreasing concentration and reversibility of the resource sharing model, supply shortages and deregulation in the bulgarian newspaper industry,1987-1992, Organization Studies, 21(2), 383-404.
[14] Dobrev, S. D., Kim, T.Y., and Hannan, M. T. (2001). Dynamics of niche width and resource sharing,American Journal of Sociology, 106(5), 1299-1337.
[15] Dovev, L. Pamela, R. H., and Poonam, K. (2012). Organizational differences, relational mechanisms, and alliance performance, Strategic Management Journal, 33(12),1453-1479.
[16] Dyer, J. H. and Nobeoka, K. (2000). Creating and managing a high-performance knowledge-sharing network, the Toyota case, Strategic Management Journal, 21(3),345-467.
[17] Ernst, H. (2001). Patent applications and subsequent changes of performance, evidence from time-series cross-section analyses on the firm level, Research Policy, 30(3), 143-157.
[18] Felzensztein, C., Stringer, C., Benson-Rea, M., and Freeman, S. (2014). International marketing strategies in industrial clusters: Insights from the southern hemisphere. Journal of Business Research, 67(5), 837-846.
[19] Furman, J. l., Porter, M. E., and Stern, S. (2002). The determinants of national innovative capacity, Research Policy, 31(6), 899-933.
[20] Ghoshal, S. and Bartlett, C. (1988). Organizing for worldwide effectiveness, the transnational solution, California Management Review, 31(1), 54-74.
[21] Gilbert, M. and Cordey-Hayes, M. (1996). Understanding the process of knowledge transfer to achieve successful technological innovation, Technovation, 16(6), 302-312.
[22] Gordon, I. R., and McCann, P. (2000). Industrial clusters, complexes, agglomeration and/or social networks? Urban studies, 37(3), 513-532.
[23] Granovetter, M. S. (1973). Economic action and social structure, the problem of embeddedness, American Journal of Sociology, 19(3), 481-510.
[24] Gregersen, B. and Johnson, B. (1991). Learning economic indications, a survey, Journal of Economic Literature, 32(3), 1661-1707.
[25] Gruner and Homburg, 2000. Does customer interaction relationship enhance new product success?Journal of the Business Research, 49(1),1-14.
[26] Gupta, A. K., and Govindarajan, V. (2000). Knowledge flows within multinational corporation, Strategic Management Journal, 21(4), 473-496.
[27] Hannan, M. T., Carroll, G. R.andPolos, L. (2002). A formal theory of resource sharing, Stanford Graduate School of Business.
[28] Harem, T., Krogh, G., and Roos, J. (1996). Knowledge-based strategic change, Managing Knowledge, Perspectives on Cooperation and Competition, 116-136, London, Sage Publications.
[29] Higgins, J. M. (1995). Innovation, the core competence, Planning Review, 23(6), 32-36.
[30] Kaiser, H. F. (1974). An Index of Factorial Simplicity, Psychometrika, 39 (1), 31-36.
[31] Kogut, B. and Zander, U. (1993). Knowledge of the firm and the evolutionary theory of multinational cooperation, Journal of International Business Studies, 24(4), 625-645.
[32] Krackhardt, D. (1992). The strength of strong ties, the importance of philos in organizations. In N. Norhria and R. G. Eccles, Networks and Organizations, Structure, Form, and Action. Boston, Harvard Business School Press. 216-239.
[33] Lin, N. (1999). Building a network theory of social capital, Connection, 22(1), 28-51.
[34] Luger, M. (2001). The use of cluster analysis in high tech industrial park planning, 2001 Symposium on Industrial Park Planning and Development.
[35] 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.
[36] Malmberg, A. and Maskell, P. (2006). Localized learning revisited, Growth and Change, 37(1),1-18.
[37] McDonald F. and Vertova G. (2001). Geographical concentration and competitiveness in the European community, European Business Review, 13(3), 157-165.
[38] McEvily, B. and Zaheer, A. (1999). Bridging ties, a source of firm heterogeneity in competitive capabilities, Strategic Management Journal, 20(12), 1133-1156.
[39] Minbaeva, D. B. (2005). HRM practices and MNC knowledge transfer, Personnel Review, 34(1), 125-144.
[40] Nahapiet, J. and Ghoshal, S. (1998). Social capital intellectual capital and the organizational advantage, Academy of Management Review, 23(2), 242-266.
[41] Newcomer, K. and Triplett, T. (2004). Using Surveys. In Joseph S. Wholey, Harry P. Hatry and Kathryn E. Newcomer (Eds) Handbook of Practical Program Evaluation, 257-291. San Francisco, CA, Jossey-Bass.
[42] Nonaka, I. and Takuchi, H. (1995). The knowledge-creating company, Oxford University Press, New York.
[43] Nunally, J. C. (1978). Psychometric Theory, New York, McGraw-Hill.
[44] O'Dell, C. and Grayson, Jr. C. J. (1998). If only we knew what we know, the transfer of internal knowledge and best practice, New York, Free Press.
[45] Porter, M. E. (1998). Clusters and the new economics of competition, Harvard Business Review, 76(6), 77-90.
[46] Rosenfeld, S. A. (2002). A guide to cluster strategies in less favoured regions, NC, Regional Technology Strategies Inc.
[47] Schulz, M., (2001). The uncertain relevance of newness:organizational learning and knowledge flow, Academy of Management Journal, 44(4), 661-681.
[48] Smil, V. (2005). Creating the twentieth century: technical innovations of 1867-1914 and their lasting impact, Oxford University Press.
[49] Smith K. G. and Carroll, S. J. (1995). Intra-and inter-organizational cooperation, toward a research agenda, Academy of Management Journal, 38(1),7-23.
[50] Steinle, C. and Schiele, H. (2002). When do industries cluster ? A Proposal on how to assess and industry's propensity to concentrate at single region or nation, Research Policy, 31(6), 849-859.
[51] Storper, M. A. and Venables. J. (2004). Buzz, Face-to-face contact and the urban economy, Journal of Economic Geography, 4(4), 351-370.
[52] Stuart, T. E. (2000). Inter-organizational alliances and the performance of firms, a study of growth and innovation rates in high-technology industry, Strategic Management Journal, 21(8), 791-811.
[53] Szulanski, G. (1996). Exploring internal stickiness, impediments to the transfer of best practice within the firm, Strategic Management Journal, 17 (summer special issue),27-43.
[54] Tallman, S., Jenkins, M., Henry, N., and Pinch, S. (2004). Knowledge, clusters, and competitive advantage, Academy of Management Review, 29(2), 258-271.
[55] Thomas, A. and Williams, G. R. (1991). A strategy to provide retirement benefits for international transferees in a global company. Benefits and Compensation International, (October), 2-7.
[56] Tristão, H. M., Oprime, P. C., Jugend, D., and Da Silva, S. L. (2013). Innovation in industrial clusters: a survey of footwear companies in brazil. Journal of Technology Management and Innovation, 8(3), 45-56.
[57] Tsai, D. H. A. (2005). Knowledge spillovers and high-technology clustering , evidence from Taiwan's Hsinchu science-based industrial park, Contemporary Economic Policy, 23(1), 349-364.
[58] Tsai, W. and Ghoshal, S. (1998). Social capital and value: the role of intrafirm networks, Academy of Management Journal, 41(4), 464-476.
[59] Wind, Y. and Mahajan, V. (1997). Issues and opportunities in new product development, an introduction to the special issue, Journal of Marketing Research, 34(1), 1-12.
[60] Wolfe, D. A. and Gertler, M. S. (2004). Cluster from the inside and out, local dynamics and global linkage, Urban Studies, 41(5-6), 1071-1093.
[61] Wortzel, R. (1979). New Life Style Determinants of Women’s Food Shopping Behavior. Journal of Marketing, 43(3): 28-29.
[62] Yli-Renko, H., Autio, E., and Tontti, V. (2002). Social capital, knowledge, and the international growth of technology-based new firms, International Business Review, 11(3),279-304.
[63] Zahra, S. A. and George, G. (2002). Absorptive capacity, a review, reconceptualization and extension, Academy of Management Review, 27(2), 185-203.