Which knowledge spillovers are better for entrepreneurship. Evidence from Italy.

The knowledge spillover theory of entrepreneurship (KSTE) posits that investment in public research plays a key role in providing knowledge spillovers and their market exploitation through the start-up of new ventures. The key... [ view full abstract ]

The knowledge spillover theory of entrepreneurship (KSTE) posits that investment in public research plays a key role in providing knowledge spillovers and their market exploitation through the start-up of new ventures. The key link between knowledge created within public research institutions (PRI) and its application to new products and services are the well trained researchers working within PRI and educate students, that are fundamental to overcome the ‘knowledge filter’ existing between new knowledge creation and its exploitation tin the market.
The main aim of this paper is to verify to what extent the KSTE holds in explaining the entrepreneurial rates (ER) in knowledge intensive sectors in Italy, analysing the relations between the flow of graduate students in Italian universities in different disciplines and the ER at local level in the period 2004-2012. The study also aims at analyzing the influence of the local environment on the knowledge spillover mechanism. For this reason we control for several economic and social variables.
The results of the paper show that the investment in scientific areas are relevant in explaining the ER in knowledge intensive sectors and the importance of the local context in influencing the link between investment in new knowledge and ER.