In economic geography, an overflow, or spreading, of information from elsewhere; an indirect, unpaid-for effect of economic activity (also called an externality), such as spillovers between university research and development, and firms (although Boders (2004) J. Econ. Geog. 4 reports that only regions with low R&D density benefit from interregional spillovers). Knowledge spillovers mean that firms can acquire knowledge and information created by others through expenditure on industrial R&D without payment. Movements of labour between firms, informal contacts, business meetings, close customer–producer relations, and face-to-face contacts are all mechanisms fostering spillovers; see Engelkstoft et al. (2006) Papers Reg. Sci. 85, 1. Adams (2002) J. Econ. Geog. 2 finds that academic spillovers are more localized than industrial spillovers.
See proximity.