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Tacit Knowledge Transfer, Geographical Proximity, and Inter-Firm Contracts: The Silicon Valley Case

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Social Capital and Business Development in High-Technology Clusters

Part of the book series: International Studies in Entrepreneurship ((ISEN,volume 18))

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Notes

  1. 1.

    Alternatively, we also estimate a multinomial logit equation and construct a test to compare the ordered versus unordered model. Since, these two alternatives are nontested, the appropriate test for such comparison in this case is not the conventional likelihood-ratio test. Instead, we employ an asymptotic likelihood-ratio test, developed by Vuong (1989), which enables us to compare these two models. As reported in Small and Song (1992), this test computes the difference in fitted log-likelihood values between the two models and compares it to a theoretical distribution that Vuong derives. In this case, the value of the test statistic, under the null hypothesis this becomes, is 0.083, and hence the test is inconclusive. There is an obvious weakness to Vuong’s test, as the test statistic does not take the number of parameters into account. A rough comparison of the results shows that the coefficients from the unordered model have invariably larger standard errors. Further, we observe that the signs of the coefficient estimates for the critical variables are the same from these two regressions and the magnitudes are quite similar.

  2. 2.

    For example, in subsequent work by Aydogan and Lyon (2004) we construct a theoretical work.

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Authors and Affiliations

  1. Department of Economics, Çankaya University, USA

    Neslihan Aydogan

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  1. Neslihan Aydogan
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Aydogan, N. (2008). Tacit Knowledge Transfer, Geographical Proximity, and Inter-Firm Contracts: The Silicon Valley Case. In: Social Capital and Business Development in High-Technology Clusters. International Studies in Entrepreneurship, vol 18. Springer, New York, NY. https://doi.org/10.1007/978-0-387-71911-5_2

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