Proceedings of the Korea Technology Innovation Society Conference (한국기술혁신학회:학술대회논문집)
- 2014.10a
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- Pages.189-203
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- 2014
Comparing the ICT industries of Silicon Valley and Route 128: What's law got to do with it?
- Timberman, Alex (Alex Timberman, Department of Economics, Hannam University) ;
- Seol, Sung-Soo (Department of Economics, Hannam University)
- Published : 2014.10.31
Abstract
Silicon Valley's legal foundation in recent years has surfaced on the radar of policy planners who model Silicon Valley's ICT industry. Precisely, the prohibition of covenants not to compete is linked to firm to firm knowledge spillovers by way of mobile workers positioned as nodes in a system of innovation. Meanwhile, traditional frameworks support enforcement of covenants not to compete as a way to encourage R&D into the worker and to prevent the worker's tacit knowledge and know-how from fleeing. This article examines the ICT industry in Silicon Valley and Route 128 to argue that California's unique law is a key factor in the success of Silicon Valley firms. Theoretically, we reconcile the ostensible strife between enforcement and prohibition frameworks by presenting an industrial approach. We contend that selective enforcement by industry can maximize the policy tools of discorded planners.
Keywords
- Covenants not to compete;
- non-compete law;
- labor mobility;
- knowledge spillover;
- Silicon Valley;
- ICT Industry