The knowledge spillover theory of intrapreneurship

Introducing the Knowledge Spillover Theory of Intrapreneurship, we examine how labour mobility impacts innovation distributed by firm size. A matched employer-employee dataset, pooled with firm-level patent application data, is implemented in the analysis. We provide new evidence that knowledge workers' mobility has a positive and strongly significant impact on all firms' innovation output, measured as patent applications. The patterns and effects do however differ between large and small firms. More precisely, for small firms, intraregional mobility of knowledge workers who have previously worked in a patenting firm (the learning-by-hiring effect) is shown to be statistically and economically highly significant, whereas only limited impact could be detected for firms losing knowledge workers (the learning-by-diaspora effect).