Embeddedness, Milieu, and Innovation among High-Technology Firms: A Richardson, Texas, Case Study

Abstract

The author seeks to contribute to the debate on embeddedness, milieu, and innovation in industrial districts through a case study of high-technology firms in Richardson, an inner-ring suburban city of the Dallas–Fort Worth Metropolitan area. Richardson is important because it can be clearly defined as an industrial district, with over 600 high-technology firms and 70 000 employees. The results suggest that the district is robust and highly innovative with considerable capacity for self-sustaining growth. The firms are well integrated, locally and nationally. Despite extensive formal connections, firms' relationships are not very embedded locally. The link between embeddedness and innovation is subtle at best, and is confined to a small set of the most highly innovative firms. Similarly, evidence of a well-established industrial milieu was not forthcoming, although it may be emerging. The relationship between milieu and innovation was vague and was confined to the most innovative firms. The long-term viability of the district is closely tied to the economic health of the metropolitan economy, suggesting that development strategies focused on the district per se are likely to meet with limited success.