Technology spillovers:
A)Are caused by patents.
B)Can lead to clustering of technology firms near one another.
C)Are examples of negative externalities.
D)All of the above are true.

Question

Technology spillovers:
A)​Are caused by patents.
B)​Can lead to clustering of technology firms near one another.
C)​Are examples of negative externalities.
D)​All of the above are true.

Quizplus · Accepted Answer

Technology spillovers refer to the unintentional diffusion of knowledge, ideas and skills between organizations or individuals. This can occur through various channels, such as labor mobility, collaborations, and knowledge networks. Patents, on the other hand, are legal restrictions that aim to protect intellectual property rights and prevent spillovers. Therefore, option A is incorrect. Option C is also incorrect, as technology spillovers are generally considered positive externalities, as they can enhance innovation, productivity and economic growth. Finally, option D is incorrect, as only B is a valid statement. Clustering of technology firms has been observed in several regions, such as Silicon Valley, Boston, and Bangalore, due to the benefits of agglomeration economies, which refer to the advantages of proximity, diversity, and competition among firms.

Technology Spillovers