44th Congress of the European Regional Science Association: "Regions and Fiscal Federalism", 25th - 29th August 2004, Porto, Portugal
Relevant scientific literature has demonstrated that in spaces of smaller scale than the national, the availability of scientific knowledge is also relevant for generating spillover effects that benefit the industrial sector. The proliferation of such literature consistently stressing the importance of physical proximity for the two-way flow of knowledge and for the development and fostering of innovation, together with the high degree of self-government of the Spanish regions (which have the competence to develop their own R&D policies), all suggest that the relationships between the scientific community and the industrial sector may be closer and more productive in the regions where the scientific potential is more relevant, in comparison with other regions. The basic objective of this article is to test for the possible differential effects of a favourable scientific environment on science-technology relationships, and more specifically, to determine if the considerable regional resources directed towards scientific research in local universities are being translated into economic results for industry, by way of better utilisation of scientific knowledge to enable companies to generate more and better innovations in processes and products. The methodology that we employ relates the scientific citations in patent documents - as a basic indicator of these science-technology flows- with various indicators of resources and results of academic research that reflect the scientific research environment. With caution, and recognising the limitations inherent in the NPC (non patent citation) methodology, different econometric specifications permit the conclusion to be drawn that companies of those regions with a more favourable scientific environment make greater use of scientific knowledge. JEL Classification: O31, O38, C21, R59.