Knowledge-based firm birth and regional resilience: core-municipality externalities in Germany’s relational peripheries facing the 2008/09 crisis

This study examines knowledge-based firm birth as an element of regional resilience in municipalities surrounding core cities in Germany during the 2008/09 financial crisis and the subsequent immediate post-crisis period. The main research question is: Which agglomeration externalities and innovation resources in core municipalities are associated with knowledge-based firm birth in their surrounding smaller municipalities as relational peripheries, and how do these relationships differ between the crisis and post-crisis periods? Given the strong dependence of knowledge-based industries on tacit knowledge spillovers, as well as differences in their industry-specific locational determinants, the analysis examines high-tech manufacturing (HTM) and knowledge-intensive business services (KIBS) separately. This paper makes three main contributions. First, it extends research on borrowed size and intra-regional knowledge spillovers within core municipalities and relational peripheries. Second, it demonstrates that these associations are industry- and stage-specific, differing between HTM and KIBS and between crisis and post-crisis periods. Third, it contributes to the regional resilience literature by showing how different forms of core-city knowledge are associated with knowledge-based firm birth as a potential mechanism of adaptation and adaptability in relational peripheries, with unrelated variety and market-oriented knowledge emerging as particularly persistent correlates.