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ISSN : 2287-1608
Comparing the ICT industries of Silicon Valley and Route 128: What has law got to do with it?
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Abstract
Silicon Valley’s legal foundation in recent years has surfaced on the radar of policy planners who model Silicon Valley’s information and communication technologies (ICT) industry. Precisely, the prohibition of covenants not to compete (CNCs) 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 CNCs as a way to encourage R&D activities to the worker and to prevent the worker’s tacit knowledge and know-how from fleeing. Amidst the battle for the restraint or release of human capital, we present an industrial approach to reconcile the ostensible strife between enforcement and prohibition frameworks. Theoretically, we contend an industrial approach can maximize the policy tools of discorded planners. Moreover, this article newly compares the ICT industries of Silicon Valley and Route 128 to argue that California’s law is a unique factor in the greater success of Silicon Valley firms.
- keywords
- Covenants not to compete, ICT industry, knowledge spillover, labor mobility, non-compete law, Silicon Valley
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