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Gone But Not Forgotten: Labor Flows, Knowledge Spillovers, and Enduring Social Capital

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  • Ajay Agrawal
  • Iain Cockburn
  • John McHale

Abstract

It is well known that patent citations occur disproportionately between patents issued to inventors living in the same location, which has been taken as evidence of geographically localized knowledge spillovers. In this study, we find that patent citations also occur disproportionately often in locations where the cited inventor was living prior to being issued the patent in question, which we interpret as evidence of a significant role played by social capital in promoting knowledge spillovers. We first develop a model of purposeful investments in social capital by co-located inventors that incorporates the effect of expected mobility. Using patent and citation data, we then test two hypotheses motivated by the model. First, we find strong evidence in support of the enduring social capital hypothesis; social ties that facilitate knowledge transfer persist even after formerly co-located individuals are separated. Consistent with the model, we find that individuals with higher ex ante mobility are somewhat less likely to invest in location-specific social relationships, but the pattern of spillovers implied by patent citations is consistent with them investing in those social relationships that survive subsequent geographic separation. Second, we find strong evidence that the social ties associated with co-location are particularly important for facilitating knowledge spillovers across technology fields or communities of practice where alternative mechanisms for transferring knowledge are more costly.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 9950.

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Date of creation: Sep 2003
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Publication status: published as Agrawal, A., I. Cockburn and J. McHale. "Gone But Not Forgotten: Labor Flows, Knowledge Spillovers and Enduring Social Capital." Journal of Economic Geography 6, 5 (2006): 571-591.
Handle: RePEc:nbr:nberwo:9950

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  1. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-40, June.
  2. Adam B. Jaffe & Manuel Trajtenberg & Michael S. Fogarty, 2000. "The Meaning of Patent Citations: Report on the NBER/Case-Western Reserve Survey of Patentees," NBER Working Papers 7631, National Bureau of Economic Research, Inc.
  3. George J. Borjas, 1994. "The Economic Benefits from Immigration," NBER Working Papers 4955, National Bureau of Economic Research, Inc.
  4. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
  5. Iain M. Cockburn & Samuel Kortum & Scott Stern, 2002. "Are All Patent Examiners Equal? The Impact of Examiner Characteristics," NBER Working Papers 8980, National Bureau of Economic Research, Inc.
  6. Paul M Romer, 1999. "Endogenous Technological Change," Levine's Working Paper Archive 2135, David K. Levine.
  7. Zucker, Lynne G & Darby, Michael R & Brewer, Marilynn B, 1998. "Intellectual Human Capital and the Birth of U.S. Biotechnology Enterprises," American Economic Review, American Economic Association, vol. 88(1), pages 290-306, March.
  8. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October.
  9. Manuel Trajtenberg & Rebecca Henderson & Adam Jaffe, 1997. "University Versus Corporate Patents: A Window On The Basicness Of Invention," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 5(1), pages 19-50.
  10. James E. Rauch, 2001. "Business and Social Networks in International Trade," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1177-1203, December.
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