Economic activities are highly clustered. Geographic concentration is a predominant feature of modern economies. Empirical studies of the external effects of R&D suggest that both geographic and technological distance attenuate inter-firm spillovers from innovative activity and influence the growing inside the regions. The results to present will focus on localization of Knowledge spillovers that may reflect the propensity of economic growth to agglomerate geographically for reasons exclusive of the geographic dependence of knowledge spillovers. The purpose is to correlate measures of geographic and technological distance and demonstrate that knowledge spillovers are largest among technological neighbors and that geographic proximity has an impact on this hypothesis. Some authors say that concentration of an industry in a city facilitates inter-firm spillovers and consequently the growth of the industry and the city.