Geographic sources of competitive advantage driving innovation in the medical device industry: Proximity, place and milieu
Yambrach, Frederick James
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This dissertation examines the relationship between geographic sources of competitive advantage found in regions and the innovative ability of medical device firms in those regions. The basic argument is that innovation levels, measured in patent production, are positively tied to the geographic proximity of medical schools, other medical device firms, universities with bioengineering programs, and specialized suppliers. The main hypothesis is that medical device firms locating in areas with these attributes will have higher levels of innovation than firms locating outside these regions. The dissertation hypotheses were initially tested with a series of bivariate correlations. It cannot be assumed that the data were normally distributed. Preliminary histograms indicate skewed distributions and at least one of the variables is in ranked order therefore, non-parametric statistical tools were chosen for analysis. The correlations between the variables indicate that the geographic proximity of medical schools, other medical device firms, universities with bioengineering programs, and specialized suppliers are positively correlated and that their relationships should be analyzed to determine how much each contributes to patent generation. The next analytical technique used to evaluate the data is based on information found from the previous results. A regression technique was selected because of the ability to identify each independent variable's contribution to the dependent variable. This technique identified the specific geographic variables that contributed the greatest to patent generation. The existence of a research oriented medical school in a region was the most powerful contributing variable to patent generation. The presence of specialized suppliers was heavily correlated with the presence of other medical device firms and specifically small and medium-sized firms. The conclusion presents that these firms tend to locate and operate in regions where there exist specific factors and these factors enhance a firm's ability to innovate. This conclusion is supported by the fact that almost 85 percent of the firms were located in the largest metropolitan areas containing several of these factors.