How science park mission affects small firms’ innovation performance: evidence from Indonesia

Abstract

Despite the widespread existence of science parks (SPs) across various countries, their effectiveness in fostering innovation performance of on-park small firms is still inconclusive. One of the reasons is that SPs have always been defined uniformly in theory, while in practice, they significantly differ in many ways. This study argues that the innovation performance of on-park small firms might be moderated by the park missions. This study uses the cases of two SPs with different missions in Indonesia: the first is university-led, which is R&D oriented, while the other is government-led and focuses on entrepreneurship. Results confirm hypotheses that if the firms’ main aim is to introduce new products, located adjacent to a university-led park is more advantageous. On-park firms are likely to innovate if the park mission suits the firms’ designated activities, in this case, whether in R&D or business development. Results also indicate that park mission fashions the park management strategy which suits the need of their tenant. Ultimately, this study leads to better understanding of policies in SPs development, particularly in emerging countries.