Innovation, international trade and knowledge spillovers in the London Metropolitan Region (di James Simmie) - ABSTRACT: In this paper it is argued that the export base of cities is important in driving their relative competitiveness and economic growth. The most novel innovations underlie much export success. These in their turn are often driven by the demands of sophisticated customers many of whom are located in other advanced national economies. World-class innovations require knowledge of the state of the art in their particular specialisation. Much of this knowledge spills over from the international regions where it is located via the mechanisms of international trade and personal contacts. These propositions are tested using a survey of 128 innovation award winning firms in the London Metropolitan Region. This sample shows that innovation is one of the keys to competitive exports to the global economy. Most of the most novel innovations were being exported to the advanced economies of Europe and North America. As a result there were extensive trading relationships between the UK based firms and these international markets. It is argued that these relationships were the basis for international knowledge spillovers that further enhanced the innovative capacities of firms in the LMR. Face-to-face meetings using air transport were the main way in which knowledge and experience spilled over from one international trading node to another.
Keywords: Innovation, Trade, Exports, Knowledge Spillovers