Knowledge Spillovers in Emerging Wine Regions

Eric C. Mota (Baylor University)
Peter G. Klein (Baylor University)

Abstract: Nascent firms have long relied on networks, clusters, and alliances to exploit knowledge spillovers (Bruderl & Preisendorfer, 1998; McEvily & Marcus, 2005; Zheng, Singh & Mitchell, 2015). Much of the recent empirical literature on networks focuses on innovative, high-technology companies, showing how a firm’s network position affects its innovative activities (McDermott, Corredoira & Kruse, 2009). What about less innovative products and markets? We look at emergent winery clusters in non-traditional US wine-producing areas such as Michigan, Missouri, New York, and Vermont. These firms generally produce lower-quality, less expensive products that are consumed locally, rather than high-quality products for export. Consistent with previous research, we find that a firm’s ties to other actors affect its performance (Elfring & Hulsink, 2003; Li, Zubielqui & O’Connor, 2015; Rowley, Baum, Shipilov, Greve & Rao, 2004). Unlike previous work, however, we find that the main determinant of firm performance is the firm’s relationship with an industry association, which performs the critical role of network anchor.

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