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Not Invented Here? Innovation in company towns

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  • Agrawal, Ajay
  • Cockburn, Iain
  • Rosell, Carlos

Abstract

We examine variation in the concentration of inventive activity across 72 of North America's most highly innovative locations. In 12 of these areas, innovation is particularly concentrated in a single, large firm; we refer to such locations as "company towns". We find that inventors employed by large firms in these locations tend to draw disproportionately from their firm's own prior inventions (as measured by citations to their own prior patents) relative to what would be expected given the underlying distribution of innovative activity across all inventing firms in a particular technology field. Furthermore, we find such inventors are more likely to build upon the same prior inventions year after year. However, smaller firms in company towns do not exhibit this myopic behavior; they draw upon prior inventions as broadly as their small-firm counterparts in more diverse locations. In addition, we find that inventions by large firms in company towns have less impact than those produced elsewhere, although the difference is modest, and that the impact is disproportionately appropriated by the inventing firms themselves. Finally, the geographic scope of impact realized by company town inventions is narrower, whether produced by large or small firms.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 67 (2010)
Issue (Month): 1 (January)
Pages: 78-89

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Handle: RePEc:eee:juecon:v:67:y:2010:i:1:p:78-89

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Web page: http://www.elsevier.com/locate/inca/622905

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Keywords: Knowledge flows Agglomeration Recombination Innovation Entrepreneurship;

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References

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Cited by:
  1. Yasusada Murata & Ryo Nakajima & Ryosuke Okamoto & Ryuichi Tamura, 2011. "Localized knowledge spillovers and patent citations: A distance-based approach," Tsukuba Economics Working Papers, Economics, Graduate School of Humanities and Social Sciences, University of Tsukuba 2010-010, Economics, Graduate School of Humanities and Social Sciences, University of Tsukuba.
  2. Ufuk Akcigit & William R. Kerr, 2010. "Growth Through Heterogeneous Innovations," NBER Working Papers 16443, National Bureau of Economic Research, Inc.
  3. Jordi Jofre-Monseny & Raquel Marín-López & Elisabet Viladecans-Marsal, 2012. "What underlies localization and urbanization economies? Evidence from the location of new firms," Working Papers, Institut d'Economia de Barcelona (IEB) 2012/9, Institut d'Economia de Barcelona (IEB).
  4. Aaron Chatterji & Edward L. Glaeser & William R. Kerr, 2013. "Clusters of Entrepreneurship and Innovation," NBER Working Papers 19013, National Bureau of Economic Research, Inc.
  5. Kerr, William R., 2010. "Breakthrough inventions and migrating clusters of innovation," Journal of Urban Economics, Elsevier, Elsevier, vol. 67(1), pages 46-60, January.
  6. Stephen Roper & James H. Love & Ying Zhou, 2014. "Knowledge context, learning and innovation: an integrating framework," Research Papers, University of Warwick, Warwick Business School, Enterprise Research Centre 0020, University of Warwick, Warwick Business School, Enterprise Research Centre.
  7. Jordi Jofre-Monseny & Raquel Marín-López & Elisabet Viladecans-Marsal, 2010. "The mechanisms of agglomeration: Evidence from the effect of inter-industry relations on the location of new firms," Working Papers, Institut d'Economia de Barcelona (IEB) 2010/49, Institut d'Economia de Barcelona (IEB).
  8. Gerald Carlino & William R. Kerr, 2014. "Agglomeration and Innovation," Harvard Business School Working Papers, Harvard Business School 15-007, Harvard Business School.
  9. Yasusada Murata & Ryo Nakajima & Ryosuke Okamoto & Ryuichi Tamura, 2013. "Localized knowledge spillovers and patent citations: A distance-based approach (revised version)," GRIPS Discussion Papers, National Graduate Institute for Policy Studies 12-18, National Graduate Institute for Policy Studies.
  10. Aurélie LALANNE (GREThA, CNRS, UMR 5113) & Guillaume POUYANNE ( GREThA, CNRS, UMR 5113), 2012. "Ten years of metropolization in economics: a bibliometric approach (In French)," Cahiers du GREThA, Groupe de Recherche en Economie Théorique et Appliquée 2012-11, Groupe de Recherche en Economie Théorique et Appliquée.

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