The Roles and Measurements of Proximity in Sustained Technology Development: A Literature Review

Abstract

In existing studies, sustainable technology development involves harnessing knowledge assets to improve technological development and innovation to create competitive advantage for a firm. In recent decades, there has been a huge amount of scholarly articles on how technology development and innovation sustain competitive advantage. However, until recently most research focused on the spatial component of innovation and its influence on sustained technology development. Many studies have used proximity to examine spatial and relational mechanisms that lead to knowledge spillover and sustainable technology development. Reviewing 123 scholarly articles relating to proximity of innovation (1980–2018), this paper attempts to explore both spatial and non-spatial factors that influence sustainable technology and innovation development including geographic, cognitive, organizational, social, and institutional proximity. The review showed that each proximity dimension has relative importance and can be peculiar. For example, geographical proximity highlights the role of location and relative distance range in determining knowledge spillovers, especially relevant for face-to-face interaction and conditions that require certain types of complex tacit knowledge. This paper makes important contributions to our understanding of spatial and non-spatial proximity factors associated with sustainable technology development. The review showed that interpersonal factors are important for knowledge transfer to take place as knowledge does not depend entirely on location. The findings show that commonly used approaches to measure proximities include patent data and nomenclature of territorial units for statistics, not widely accessible across contexts, which impacts research and development (R&D) policy development. Cognitive, social, and institutional dimensions are important for knowledge transfer, supported by interplay of other proximities that determine and influence sustained technology development. In addition, management of proximity influences how knowledge assets are used for innovation and sustained technology development.