Knowledge spillovers, productivity and patent

We examine potential heterogeneity in the capacity to benefit from knowledge spillovers in metropolitan areas between foreign-owned and domestic multinational enterprises, and between small and large firms. The study is restricted to R&D firms in the manufacturing sector and utilizes an unbalanced sample of 1073 Swedish firms covering a 16-year period with close to 11,000 observations. We apply linear and nonlinear approaches to test the importance of knowledge spillovers on labour productivity and patent applications. The overall result shows that not all R&D firms benefit from knowledge spillovers as a result of their presence in an agglomeration area.