This conceptual paper examines the relationships between knowledge processes, geographical proximity and inter-firm collaboration. It focuses on antecedents to collaboration by differentiating between opportunity recognition and opportunity exploitation, and relating them respectively to firms' potential and actual collaboration. It also differentiates between geographically proximate and non-proximate firms, and relates their intent to respectively access and acquire knowledge. In order to provide a possible explanation for the paradox of concurrent co-operation and competition among collaborating firms, the paper theorises about the moderating role of type of knowledge in the relationship between knowledge access/acquisition and co-operation/competition. When managers decide to engage their firms in collaboration with geographically proximate firms, they need to be clear whether their objective is to access or acquire part of the knowledge these other firms possess. If the motivation is knowledge access, the dominant tendency is to co-operate; however, if the objective is knowledge acquisition, the prevailing inclination is to compete.
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