How do spatial and social proximity influence knowledge flows? Evidence from patent data

We examine how the spatial and social proximity of inventors affects access to knowledge, focusing especially on how the two forms of proximity interact. Employing patent citation data and using same-MSA and co-ethnicity as proxies for spatial and social proximity, respectively, we estimate a knowledge flow production function. Our results suggest that although spatial and social proximity both increase the probability of knowledge flows between individuals, the marginal benefit of geographic proximity is greater for inventors who are not socially close. We also report that the marginal benefit of being members of the same technical community of practice is greater in terms of access to knowledge for inventors who are not co-located. Overall, these results imply that spatial and social proximity are substitutes in their influence on access to knowledge. We discuss the implications of these findings in terms of the optimal dispersion of socially connected inventors.