**2.2 Jacobs spillovers**

In 1969 Jane Jacobs developed another knowledge spillover effect theory [26]. Jacobs believes that knowledge spillover effects are connected with differentiation of industries on the territory. In her opinion, concentration of different industries in one place stimulates innovation by uniting people having different knowledge and professional experience, forming the ground for idea exchange from different perspectives. Also reasoning on the competition, Jacobs claims that developed markets with a large number of players are the most positive environment for innovation. At the same time, high monopolization level restrains innovations from emergence [26].

Jacobs inter-sectoral effects occur between companies belonging to different sectors: knowledge flows occur between complementary sectors of industry or suppliers and customers [27]. It is not clustering but the diversity of industries that triggers mutual, cross-enriching spillovers: movement, flow of ideas, techniques, tools to other industries lead to their different, completely new application, and, accordingly, to a different result, end product [28].

**Table 2** below provides a systematization of knowledge spillover effects based on "location within/outside the industry," where the horizontal axis displays two main types of market structures by a degree of competition (competitive and monopolistic environment), while the vertical axis shows industry-specific characteristics of the geographical concentration of firms (cluster type, diversified industry base).

The abovementioned theories of dynamic spillover effects formulate a kind of a hypothesis on the nature of a diversified and concentrated industry base and which of the industries is more likely to experience the flow of knowledge and the fastest growth.

The role of exports as a factor driving growth in general and productivity in particular was empirically proven quite a long time ago using aggregated crosscountry and cross-industry data in time (macro level) [29]. And it was just recently that researchers decided to test longitudinal data at the inter-company level (micro and meso level) by reviewing the difference in productivity and efficiency between exporting companies and their opposites—companies that only operate in the domestic market [13].

One of the most well-known, frequently cited papers investigating this phenomenon at the macro level is [30]. The paper is based on 45 econometric models built


**7**

*Knowledge Spillover Effects: Impact of Export Learning Effects on Companies' Innovative…*

from data of companies representing 33 countries, published between 1995 and 2004. The conclusion is formed from two key statements: (1) exporting companies appear to be more efficient and innovative than non-exporting companies and (2) as a result of a "self-selection" process, more productive firms are prone to enter export markets, while export activities do not necessarily lead to improvements in

The first fact finds its confirmation in the papers [31, 32] arguing that it is the expansion of the company's footprint and sales market that encourages managers to introduce innovations and various improvements resulting from an increase in efficiency and sustainable growth. The second fact is presented at the theoretical and empirical level in [33]: innovation activity and research create a competitive advantage for a company, which leads to productivity growth that increases the likelihood of becoming an exporter and gaining a foothold not only in the national but also in the international market. An intuitive suggestion regarding a relationship between innovations and exports has been confirmed by experts at various times; however, the relationship between these processes is ambiguous and should be researched in more detail using various industries, companies, and scientific

The "self-selection" effect is analyzed in [34] on the basis of register data with the addition of customs statistics. Previous experience in a foreign market is a key to success in the future. Globalization leads to an increase in innovation activity, as shown in the papers [35, 36]. [37] test the hypotheses regarding innovation incentives for processing enterprises when entering a foreign market at macro and micro

Studies that address the question whether exports influence growth or growth are influenced by exports actually appeared in 1995 when Bernard and Jensen [38] published a number of articles that turned how things were viewed upside down. The same phenomenon was addressed in papers by [39, 40]. They used a vast sample of data obtained from surveys represented by US official statistics to explore the effectiveness of firms across all industrial sectors from a different perspective,

More contemporary empirical studies using variations of the approach were employed by [38], but, unlike them, focusing on one particular industry is also of interest for studying the similarities and differences between exporting and non-exporting companies [41, 42]. [32] studied differences between firms based on another fact: whether firms engaged in exports enter developed or developing countries. In developing countries, foreign companies earn more substantial profits than national markets, with an opposite effect observed in developed countries.

*H1: Innovation-active firms more often become exporters compared with firms that* 

The second hypothesis is devoted to the role of learning by exporting: exporting companies are more efficient than companies that are only present in the national market. [43]. Flows of knowledge between international foreign buyers, suppliers, and competitors help novice exporters improve their activities (higher postentry performance), adopt positive business experience, promote products and services faster, implement technological innovations to keep the acquired niche, and expand the zone of influence [42]. In addition, firms that enter foreign markets face more intense and fierce competition and must develop faster to survive in the future.

levels (panel data for 2005 and 2009 obtained during two surveys).

depending on whether they were engaged in exports.

Thus, our first hypothesis has been formulated.

*do not engage in active innovation.*

**3. Development of the research model and hypotheses**

*DOI: http://dx.doi.org/10.5772/intechopen.86255*

effectiveness.

institutions.

**Table 2.**

*Classification of knowledge spillover effects by industry geographical concentration.*
