What Is a Knowledge Spillover?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 25 September 2019
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Knowledge spillover is a phenomenon that occurs when information and knowledge that are collected and shared for a particular activity or project ultimately generates additional opportunities for application in other settings. From there, the spillover serves as the catalyst for the development of new ideas and new applications, often in ways that were never anticipated initially. Considered a basic in knowledge management economics, knowledge spillover can occur in any number of settings, helping to produce results that can be very exciting.

At its core, knowledge spillover is all about the sharing of ideas and methods of implementation that then inspire those who are not in direct competition to adapt those ideas for use in different settings. While the term itself is relatively new and normally focuses on technological innovations such as prompting new ideas for software and interesting new ways to make use of the Internet. The general idea has been around for centuries. In any scenario in which an idea is developed for use in a specific setting and others are inspired to take that same idea and transplant it into another setting, knowledge spillover has occurred.


In actual practice, knowledge spillover can be a process that occurs within a controlled environment, and leads to the development of new products that have some sort of connection with the original idea. For example, a company may develop a whole new process for manufacturing ketchup that in turn inspires someone in the operation to adapt the process so the company can start its own line of mustard or other condiments. In like manner, a software company may sell a popular software product that is ideal for business accounting, and someone within the company may be inspired to use the same basic platform to develop a sales database that can interface with the accounting software, a combination that many companies would find attractive.

Knowledge spillover can also occur in a wider setting. When this is the case, the innovations developed by one entity may in turn inspire someone else to develop a product that can be used in tandem with those innovations. This has occurred with the development of social networks on the Internet, with the idea of a social network itself being inspired by the earlier innovations of email lists, online chat rooms, and message boards. As individuals and businesses began to see more ways to use those earlier applications, the creation of a more comprehensive network offering the benefits of all three plus some new benefits came into being, all thanks to certain knowledge serving as food for thought that ultimately led to the creation of something new.


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