Abstract: Academics, policymakers and planners have turned their attention to innovation as a source of income and employment growth. Innovation studies often focus on scientific research and firm-level R&D as sources of innovation, but current theorizing has brought a surge of interest in broader social (networks, systems) and spatial (agglomerations, regions) dimensions. This dissertation explores how spatial interactions between industry actors shape innovativeness in the Canadian Maritime provinces wood furniture industry. In a first stage, a questionnaire was administered to wood furniture manufacturing firms in New Brunswick, Nova Scotia and Prince Edward Island (the 'Maritime provinces'). It was hypothesized that proximity to suppliers would increase the number of process innovations, proximity to customers would increase the number of product innovations, and proximity to competitors would increase both. Proximity to suppliers did increase the number of process innovations introduced by firms, although only when proximity was defined in terms of frequency of interactions (relational proximity) and not physical proximity. As for product innovations, relational proximity to suppliers mattered, although proximity to customers did not. Proximity to competitors did not increase the number of product or process innovations. In open-ended qualitative interviews, respondents confirmed that material, component and equipment suppliers did indeed serve as a key source of knowledge, by increasing technical capabilities from the technology embedded in their materials, components and equipment, as well as by their role as knowledge brokers. What facilitated these transfers of knowledge was the widening of communication channels through frequent interactions. For many, frequent electronic communications were not the best substitute for face-to-face relationships with suppliers or customers, but they relied upon electronic communications in light of their relative geographic isolation. Overall the research presents a broader appreciation of innovation than would have afforded a linear approach of scientific R&D. It calls on public policy initiatives to curb enthusiasm for R&D public funds and tax credit and move towards a more careful consideration of the role of supplier and customer networks, industry associations and other knowledge brokers in helping foster innovation, and in the role of trade fairs, trade missions and other policy instruments in facilitating knowledge exchanges.