Proximities and Innovation: Evidence from the Indian it Industry in Bangalore

DRUID Working Paper Series No. 04-10

28 Pages Posted: 30 Jun 2004

See all articles by Florian A. Täube

Florian A. Täube

European Management School; Université Libre de Bruxelles, Solvay Brussels School of Economics and Management, iCite

Date Written: June 29, 2004

Abstract

Much has been written on the success of the Indian software industry, enumerating systemic factors like first-class higher education and research institutions, both public and private; low labour costs, stimulating (state) policies etc. However, although most studies analyzing the 'Indian' software industry cover essentially the South (and West) Indian clusters, this issue has not been tackled explicitly. This paper supplements the economic geography explanations mentioned above with the additional factor social capital, which is not only important within the region, but also in transnational (ethnic) networks linking Indian software clusters with the Silicon Valley. In other words, spatial proximity is complemented with cultural proximity, thereby, extending the system of innovation. The main hypothesis is that some Indian regions are more apt to economic development and innovation due to their higher affinity to education and learning, as well as, their more general openness, which has been a main finding of my interviews. In addition, the transnational networks of Silicon Valley Indians seem to be dominated by South Indians, thus, corroborating the regional clustering of the Indian software industry.

Keywords: Proximities, diversity, India, social capital, transnational networks

JEL Classification: O30, R12, Z13, L86

Suggested Citation

Täube, Florian A., Proximities and Innovation: Evidence from the Indian it Industry in Bangalore (June 29, 2004). DRUID Working Paper Series No. 04-10. Available at SSRN: https://ssrn.com/abstract=560324 or http://dx.doi.org/10.2139/ssrn.560324

Florian A. Täube (Contact Author)

European Management School ( email )

Rheinstrasse 4N
Mainz, 55116
Germany

Université Libre de Bruxelles, Solvay Brussels School of Economics and Management, iCite ( email )

19 Av Franklin Roosevelt
1050
Brussels
Belgium

HOME PAGE: http://www.solvay.edu

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