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The social origins of inventors

Author

Listed:
  • Aghion, Philippe
  • Akcigit, Ufuk
  • Hyytinen, Ari
  • Toivanen, Otto

Abstract

In this paper, we merge three datasets - individual income data, patenting data, and IQ data - to analyze the deterninants of an individual’s probability of inventing. We find that: (i) parental income matters even after controlling for other background variables and for IQ, yet the estimated impact of parental income is greatly diminished once parental education and the individual’s IQ are controlled for; (ii) IQ has both a direct effect on the probability of inventing an indirect impact through education. The effect of IQ is larger for inventors than for medical doctors or lawyers. The impact of IQ is robust to controlling for unobserved family characteristics by focusing on potential inventors with brothers close in age. We also provide evidence on the importance of social family interactions, by looking at biological versus non-biological parents. Finally, we find a positive and significant interaction effect between IQ and father income, which suggests a misallocation of talents to innovation

Suggested Citation

  • Aghion, Philippe & Akcigit, Ufuk & Hyytinen, Ari & Toivanen, Otto, 2017. "The social origins of inventors," LSE Research Online Documents on Economics 86619, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:86619
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    File URL: http://eprints.lse.ac.uk/86619/
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    References listed on IDEAS

    as
    1. Gustavo Manso, 2011. "Motivating Innovation," Journal of Finance, American Finance Association, vol. 66(5), pages 1823-1860, October.
    2. Holmstrom, Bengt, 1989. "Agency costs and innovation," Journal of Economic Behavior & Organization, Elsevier, vol. 12(3), pages 305-327, December.
    3. Ufuk Akcigit & Salomé Baslandze & Stefanie Stantcheva, 2016. "Taxation and the International Mobility of Inventors," American Economic Review, American Economic Association, vol. 106(10), pages 2930-2981, October.
    4. April M. Franco & Matthew F. Mitchell, 2008. "Covenants not to Compete, Labor Mobility, and Industry Dynamics," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 17(3), pages 581-606, September.
    5. repec:aea:aecrev:v:108:y:2018:i:4-5:p:1034-73 is not listed on IDEAS
    6. Hertz Tom & Jayasundera Tamara & Piraino Patrizio & Selcuk Sibel & Smith Nicole & Verashchagina Alina, 2008. "The Inheritance of Educational Inequality: International Comparisons and Fifty-Year Trends," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(2), pages 1-48, January.
    7. Philippe Aghion & Ufuk Akcigit & Antonin Bergeaud & Richard Blundell & David Hemous, 2019. "Innovation and Top Income Inequality," Review of Economic Studies, Oxford University Press, vol. 86(1), pages 1-45.
    8. Sari Pekkala Kerr & Tuomas Pekkarinen & Roope Uusitalo, 2013. "School Tracking and Development of Cognitive Skills," Journal of Labor Economics, University of Chicago Press, vol. 31(3), pages 577-602.
    9. Roope Uusitalo & Juhana Vartiainen, 2009. "Finland: Firm Factors in Wages and Wage Changes," NBER Chapters,in: The Structure of Wages: An International Comparison, pages 149-178 National Bureau of Economic Research, Inc.
    10. Holmström, Bengt, 1989. "Agency Costs and Innovation," Working Paper Series 214, Research Institute of Industrial Economics.
    11. Pekkarinen, Tuomas & Uusitalo, Roope & Kerr, Sari, 2009. "School tracking and intergenerational income mobility: Evidence from the Finnish comprehensive school reform," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 965-973, August.
    12. Ufuk Akcigit & John Grigsby & Tom Nicholas, 2017. "The Rise of American Ingenuity: Innovation and Inventors of the Golden Age," NBER Working Papers 23047, National Bureau of Economic Research, Inc.
    13. Black, Sandra E. & Devereux, Paul J., 2011. "Recent Developments in Intergenerational Mobility," Handbook of Labor Economics, Elsevier.
    14. Magnus Carlsson & Gordon B. Dahl & Björn Öckert & Dan-Olof Rooth, 2015. "The Effect of Schooling on Cognitive Skills," The Review of Economics and Statistics, MIT Press, vol. 97(3), pages 533-547, July.
    15. Corak,Miles (ed.), 2004. "Generational Income Mobility in North America and Europe," Cambridge Books, Cambridge University Press, number 9780521827607.
    16. Giuri, Paola & Mariani, Myriam & Brusoni, Stefano & Crespi, Gustavo & Francoz, Dominique & Gambardella, Alfonso & Garcia-Fontes, Walter & Geuna, Aldo & Gonzales, Raul & Harhoff, Dietmar & Hoisl, Karin, 2007. "Inventors and invention processes in Europe: Results from the PatVal-EU survey," Research Policy, Elsevier, vol. 36(8), pages 1107-1127, October.
    17. Chang-Tai Hsieh & Erik Hurst & Charles I. Jones & Peter J. Klenow, 2013. "The Allocation of Talent and U.S. Economic Growth," NBER Working Papers 18693, National Bureau of Economic Research, Inc.
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    Cited by:

    1. D'Acunto, Francesco & Hoang, Daniel & Paloviita, Maritta & Weber, Michael, 2019. "IQ, expectations, and choice," Working Paper Series in Economics 127, Karlsruhe Institute of Technology (KIT), Department of Economics and Business Engineering.
    2. Alex Bell & Raj Chetty & Xavier Jaravel & Neviana Petkova & John Van Reenen, 2017. "Who Becomes an Inventor in America? The Importance of Exposure to Innovation," CEP Discussion Papers dp1519, Centre for Economic Performance, LSE.
    3. Alex Bell & Raj Chetty & Xavier Jaravel & Neviana Petkova & John Van Reenen, 2019. "Do Tax Cuts Produce More Einsteins? The Impacts of Financial Incentives vs. Exposure to Innovation on the Supply of Inventors," CEP Discussion Papers dp1597, Centre for Economic Performance, LSE.
    4. repec:iab:iabfda:201803_en is not listed on IDEAS
    5. D'Acunto, Francesco & Hoang, Daniel & Paloviita, Maritta & Weber, Michael, 2019. "Human frictions in the transmission of economic policy," Working Paper Series in Economics 128, Karlsruhe Institute of Technology (KIT), Department of Economics and Business Engineering.

    More about this item

    Keywords

    inventors; innovation; social mobility; IQ; education; parental background;

    JEL classification:

    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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