European infrastructure networks and regional innovation in science-based technologies

We analyse the innovative activity of European regions in the fields of biotechnology and semiconductor technology. We explain regional patenting levels from publication levels within each region and nearby regions to account for local knowledge spillovers. We extend this approach by including connectivity measures for each region in order to indicate their position in the pan-European networks of Internet backbone providers, airline routes and global banks. We hypothesise that a region's position in all these networks contributes to its innovation capability as these networks provide high-quality and relative cheap access to digital information (Internet), fellow researchers (airlines) and financial resources (banks). The results show that connectivity indeed supports a region's patenting level in science-based technologies. In particular, we found that connectivity through the Internet backbone and through global banks enhance innovative activity, while airline connectivity does not. A second conclusion holds that while local knowledge spillovers are found to be very strong for patenting in biotechnology, this effect is found to be absent in semiconductor patenting. This result indicates that the importance of geographical proximity in generating knowledge spillovers is highly technology-specific