Co-Working in Close Proximity: Knowledge Spillovers and Social Interaction [pdf]

Abstract:

> We examine the influence of physical proximity on between-startup knowledge spillovers at one of the largest technology co-working hubs in the United States. Relying on the random assignment of office space to the hub's 251 startups, we find that proximity positively influences knowledge spillovers as proxied by the likelihood of adopting an upstream web technology already used by a peer startup. This effect is largest for startups within close proximity of each other and quickly decays: startups more than 20 meters apart on the same floor are indistinguishable from startups on different floors.

And some details about the methodology:

> The setting for our study is one of the largest technology co-working spaces in the United States. The building consists of five floors, covering 9,300 m2 (100,000 sq.ft.).

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> To construct this variable, we exploit a novel data set (www.builtwith.com), covering over 25,000 web technologies (e.g., analytics, advertising, hosting, and CMS) that tracks how technology usage of startups change on a weekly basis (Koning et al., 2019).

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> We find that being in close proximity is associated with a three percentage point higher probability of adopting a peer technology