This paper explores how and to what extent geographic proximity matters in collaboration in technological innovations of small and medium-sized enterprises (SMEs) in Osaka Prefecture.Interfirm collaborations in technological innovations are identified using patent data for which sample SMEs co-applied with other firms or organizations. The author measures geographic distances between sample SMEs and their co-inventors and examines the relationships between the distances and their characteristics (e. g., firm size, industrial sector). The results are summarized as follows.
First, 40% of sample patents had co-patentees located within Osaka Prefecture, while the share of patents with patentees in Osaka of total patents published by the Japan Patent Office was only 17%. It is thus reasonable to assume that geographic proximity between patentees matters to some extent.
Second, smaller and younger firms showed a weak tendency to depend on technological collaborations with more geographically proximate partners, although this does not necessarily mean that the size of a firm determines the distance from its partner.
Third, mean distances from co-inventor firms differed by industrial sector. Three groups were identified: intraregional networks among SMEs; intraregional networks between SMEs and large hub companies; and interregional networks between SMEs in Osaka and large companies outside Osaka. The result indicates that there are various types of networks in terms of spatial scale and firm size in Osaka prefecture and that their differences can be partially affected by characteristics of industrial sectors.