Directions and paths of knowledge flows through personnel mobility: a social capital perspective

This paper unfolds the directions and paths of knowledge flows through personnel mobility, originally unravelling its uneven distribution across companies, due to the effect of cluster affiliation, industry affiliation and foreign affiliation. In framing our hypotheses we use a social capital perspective, which emphasizes the capability of employees to build ties across companies and to extend the overall company’s social capital. We test our hypotheses through an original database encompassing 3895 employees’ movements across and within the IT cluster in Bangalore, which produce 1331 cross-sectional directed dyads between 397 companies. Our negative binomial regressions at dyad level highlight three major findings. First both outflows and inflows of valuable employees are more likely to occur between local firms.. Second, and counter intuitively, flows of valuable employees highly concentrate from MNCs to domestic firms, thus favouring knowledge transfer from MNCs to local domain. Third, inflows of valuable employees mainly occur from rivals, while outflows distribute equally to rivals and to non-rivals.