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The agglomeration of R&D labs

Listed author(s):
  • Carlino, Gerald A.
  • Carr, Jake
  • Hunt, Robert M.
  • Smith, Tony E.

This paper has been superseded by WP 15-03. The authors document the spatial concentration of more than 1,000 research and development (R&D) labs located in the Northeast corridor of the U.S. using point pattern methods. These methods allow systematic examination of clustering at different spatial scales. In particular, Monte Carlo tests based on Ripley's (1976) K-functions are used to identify clusters of labs — at varying spatial scales — that represent statistically significant departures from random locations reflecting the underlying distribution of economic activity (employment). Using global K-functions, they first identify significant clustering of R&D labs at two different spatial scales. This clustering is by far most significant at very small spatial scales (a quarter of a mile), with significance attenuating rapidly during the first half mile. The authors also observe statistically significant clustering at distances of about 40 miles. This corresponds roughly to the size of the four major R&D clusters identified in the second stage of their analysis — one each in Boston, New York-Northern New Jersey, Philadelphia-Wilmington, and Virginia (including the District of Columbia). In this second stage of the analysis, explicit clusters are identified by a new procedure based on local K-functions, which they designate as the multiscale core-cluster approach. This new approach yields a natural nesting of clusters at different scales. The authors' global finding of clustering at two spatial scales suggests the possibility of two distinct forms of spillovers. First, the rapid attenuation of significant clustering at small spatial scales is consistent with the view that knowledge spillovers are highly localized. Second, the scale at which larger clusters are found is roughly comparable to that of local labor markets, suggesting that such markets may be the source of additional spillovers (e.g., input sharing or labor market matching externalities).

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File URL: http://www.philadelphiafed.org/research-and-data/publications/working-papers/2010/wp10-33.pdf
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Paper provided by Federal Reserve Bank of Philadelphia in its series Working Papers with number 10-33.

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Length: 1 pages
Date of creation: 2010
Handle: RePEc:fip:fedpwp:10-33
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References listed on IDEAS
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  1. William R. Kerr & Scott Duke Kominers, 2010. "Agglomerative Forces and Cluster Shapes," NBER Working Papers 16639, National Bureau of Economic Research, Inc.
  2. 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.
  3. Tomoya Mori & Tony E. Smith, 2009. "A Probabilistic Modeling Approach to the Detection of Industrial Agglomerations," KIER Working Papers 682, Kyoto University, Institute of Economic Research.
  4. Bronwyn H. Hall & Adam B. Jaffe & Manuel Trajtenberg, 2001. "The NBER Patent Citation Data File: Lessons, Insights and Methodological Tools," NBER Working Papers 8498, National Bureau of Economic Research, Inc.
  5. Yasusada Murata & Ryo Nakajima & Ryosuke Okamoto & Ryuichi Tamura, 2011. "Localized knowledge spillovers and patent citations: A distance-based approach," GRIPS Discussion Papers 11-11, National Graduate Institute for Policy Studies.
  6. 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.
  7. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 577-598.
  8. Lychagin, Sergey & Pinkse, Joris & Slade, Margaret E. & Van Reenen, John, 2010. "Spillovers in Space: Does Geography Matter?," CEPR Discussion Papers 7928, C.E.P.R. Discussion Papers.
  9. Shihe Fu, 2005. "Smart Cafe Cities: Testing Human Capital Externalities in the Boston Metropolitan Area," Working Papers 05-24, Center for Economic Studies, U.S. Census Bureau.
  10. Gilles Duranton & Henry G. Overman, 2002. "Testing for localisation using micro-geographic data," LSE Research Online Documents on Economics 20071, London School of Economics and Political Science, LSE Library.
  11. Dietmar Harhoff & Francis Narin & F. M. Scherer & Katrin Vopel, 1999. "Citation Frequency And The Value Of Patented Inventions," The Review of Economics and Statistics, MIT Press, vol. 81(3), pages 511-515, August.
  12. A Getis, 1984. "Interaction Modeling Using Second-Order Analysis," Environment and Planning A, SAGE Publishing, vol. 16(2), pages 173-183, February.
  13. Paulo Guimarães & Octávio Figueiredo & Douglas Woodward, 2007. "Measuring The Localization Of Economic Activity: A Parametric Approach," Journal of Regional Science, Wiley Blackwell, vol. 47(4), pages 753-774.
  14. Holmes, Thomas J. & Stevens, John J., 2004. "Spatial distribution of economic activities in North America," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 63, pages 2797-2843 Elsevier.
  15. repec:trn:utwpde:0902 is not listed on IDEAS
  16. Kristy Buzard & Gerald A. Carlino, 2008. "The geography of research and development activity in the U.S," Business Review, Federal Reserve Bank of Philadelphia, issue Q3, pages 1-11.
  17. Gerald A. Carlino & Robert M. Hunt, 2009. "What explains the quantity and quality of local inventive activity?," Working Papers 09-12, Federal Reserve Bank of Philadelphia.
  18. Colin Webb & Hélène Dernis & Dietmar Harhoff & Karin Hoisl, 2005. "Analysing European and International Patent Citations: A Set of EPO Patent Database Building Blocks," OECD Science, Technology and Industry Working Papers 2005/9, OECD Publishing.
  19. Mohammad Arzaghi & J. Vernon Henderson, 2008. "Networking off Madison Avenue," Review of Economic Studies, Oxford University Press, vol. 75(4), pages 1011-1038.
  20. repec:trn:utwpde:0705 is not listed on IDEAS
  21. Gerald A. Carlino & Satyajit Chatterjee & Robert M. Hunt, 2006. "Urban density and the rate of invention," Working Papers 06-14, Federal Reserve Bank of Philadelphia.
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