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Localized knowledge spillovers and patent citations: A distance-based approach

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  • Yasusada Murata

    (Advanced Research Institute for the Sciences and Humanities, Nihon University)

  • Ryo Nakajima

    (Department of Economics, Yokohama National University)

  • Ryosuke Okamoto

    (National Graduate Institute for Policy Studies)

  • Ryuichi Tamura

    (Graduate School of Humanities and Social Sciences, University of Tsukuba)

Abstract

The existence of localized knowledge spillovers found by Jaffe, Trajtenberg and Henderson (1993) has recently been challenged by Thompson and Fox-Kean (2005). To settle this debate, we develop a new approach by incorporating their concepts of control patents into the distance-based test of localization (Duranton and Overman, 2005). Using microgeographic data, we identify localization distance for each technology class while allowing for cross-boundary spillovers, unlike the existing literature where localization is detected at the state or metropolitan statistical area level. We find solid evidence supporting localized knowledge spillovers even when finer controls are used. We further relax the commonly made assumption of perfect controls, and show that the majority of technology classes exhibit localization unless hidden biases induced by imperfect controls are extremely large.

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Bibliographic Info

Paper provided by National Graduate Institute for Policy Studies in its series GRIPS Discussion Papers with number 11-11.

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Length: 42 pages
Date of creation: Sep 2011
Date of revision:
Handle: RePEc:ngi:dpaper:11-11

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  1. Nakajima, Ryo & Tamura, Ryuichi & Hanaki, Nobuyuki, 2010. "The effect of collaboration network on inventors' job match, productivity and tenure," Labour Economics, Elsevier, vol. 17(4), pages 723-734, August.
  2. Klaus Desmet & Esteban Rossi-Hansberg, 2009. "Spatial development," Working Papers 2009-18, Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales, revised 28 May 2010.
  3. Glenn Ellison & Edward L. Glaeser & William R. Kerr, 2010. "What Causes Industry Agglomeration? Evidence from Coagglomeration Patterns," American Economic Review, American Economic Association, vol. 100(3), pages 1195-1213, June.
  4. Agrawal, Ajay & Kapur, Devesh & McHale, John, 2008. "How do spatial and social proximity influence knowledge flows? Evidence from patent data," Journal of Urban Economics, Elsevier, vol. 64(2), pages 258-269, September.
  5. William R. Kerr & Scott Duke Kominers, 2010. "Agglomerative Forces and Cluster Shapes," Harvard Business School Working Papers 11-061, Harvard Business School, revised Nov 2012.
  6. Peter Thompson & Melanie Fox-Kean, 2005. "Patent Citations and the Geography of Knowledge Spillovers: A Reassessment," American Economic Review, American Economic Association, vol. 95(1), pages 450-460, March.
  7. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2000. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," NBER Working Papers 7831, National Bureau of Economic Research, Inc.
  8. Duranton, Gilles & Martin, Philippe & Mayer, Thierry & Mayneris, Florian, 2010. "The Economics of Clusters: Lessons from the French Experience," OUP Catalogue, Oxford University Press, number 9780199592203, September.
  9. Ajay Agrawal & Iain Cockburn & Carlos Rosell, 2010. "Not Invented Here? Innovation in Company Towns," NBER Chapters, in: Cities and Entrepreneurship National Bureau of Economic Research, Inc.
  10. Combes, Pierre-Philippe & Duranton, Gilles, 2001. "Labour Pooling, Labour Poaching and Spatial Clustering," CEPR Discussion Papers 2975, C.E.P.R. Discussion Papers.
  11. Peter Thompson, 2004. "Patent Citations and the Geography of Knowledge Spillovers: Evidence from Inventor- and Examiner-Added Citations," Working Papers 0405, Florida International University, Department of Economics, revised Jun 2005.
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Cited by:
  1. Kristian Behrens & Théophile Bougna, 2013. "An Anatomy of the Geographical Concentration of Canadian Manufacturing Industries," Cahiers de recherche 1327, CIRPEE.
  2. Gerald A. Carlino & Jake K. Carr & Robert M. Hunt & Tony E. Smith, 2011. "The agglomeration of R&D labs," Working Papers 11-42, Federal Reserve Bank of Philadelphia.
  3. Nakajima, Kentaro & Saito, Yukiko Umeno & Uesugi, Iichiro, 2012. "The Localization of Interfirm Transaction Relationships and Industry Agglomeration," Working Paper Series 17, Center for Interfirm Network, Institute of Economic Research, Hitotsubashi University.
  4. Yasusada Murata & Ryo Nakajima & Ryosuke Okamoto & Ryuichi Tamura, 2013. "Localized knowledge spillovers and patent citations: A distance-based approach (revised version)," GRIPS Discussion Papers 12-18, National Graduate Institute for Policy Studies.
  5. SAITO Yukiko, 2013. "Role of Hub Firms in Geographical Transaction Network," Discussion papers 13080, Research Institute of Economy, Trade and Industry (RIETI).
  6. Naoto Jinji & Xingyuan Zhang & Shoji Haruna, 2012. "The Effect of Regional Trade Agreements on Technology Spillovers through International Trade," Discussion papers e-11-006, Graduate School of Economics Project Center, Kyoto University.
  7. NAKAJIMA Kentaro & SAITO Yukiko Umeno & UESUGI Iichiro, 2012. "Localization of Interfirm Transaction Relationships and Industry Agglomeration," Discussion papers 12023, Research Institute of Economy, Trade and Industry (RIETI).
  8. Naoto Jinji & Xingyuan Zhang & Shoji Haruna, 2013. "Do Regional Trade Agreements Enhance International Technology Spillovers?," Discussion papers e-12-010, Graduate School of Economics Project Center, Kyoto University.
  9. Kristian Behrens, 2013. "Strength in Numbers? The Weak Effect of Manufacturing Clusters on Canadian Productivity," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 377, April.

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