This course surveys two of the key themes related to the process of innovation in a knowledge-based economy: the process by which new knowledge is generated and effectively transferred to those organizations with the potential to commercialize it; and secondly, the paradoxical relationship between knowledge creation and proximity in a modern global economy. Increasingly the global economy is seen as a knowledge-based one, hence the critical importance of understanding how new knowledge is generated and deployed in the form of new products and processes. At the same time, the more global the economy becomes, the greater the value of proximity, hence the fascination with how to foster the growth of new regional concentrations of knowledge and innovation, such as Silicon Valley. This course surveys the state of current knowledge about both these processes and explores the implications of this understanding for public policies designed to stimulate knowledge transfer and promote the growth of dynamic and innovative city-regions.