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Declining Business Dynamism Among Our Best Opportunities: The Role of the Burden of Knowledge

Author

Listed:
  • Thomas Astebro

    (HEC Paris - Ecole des Hautes Etudes Commerciales)

  • Serguey Braguinsky
  • Yuheng Ding

Abstract

We document that since 1997, the rate of startup formation has precipitously declined for firms operated by U.S. PhD recipients in science and engineering. These are supposedly the source of some of our best new technological and business opportunities. We link this to an increasing burden of knowledge by documenting a long-term earnings decline by founders, especially less experienced founders, greater work complexity in R&D, and more administrative work. The results suggest that established firms are better positioned to cope with the increasing burden of knowledge, in particular through the design of knowledge hierarchies, explaining why new firm entry has declined for high-tech, high-opportunity startups.

Suggested Citation

  • Thomas Astebro & Serguey Braguinsky & Yuheng Ding, 2020. "Declining Business Dynamism Among Our Best Opportunities: The Role of the Burden of Knowledge," Working Papers hal-02988451, HAL.
    • Handle: RePEc:hal:wpaper:hal-02988451
    DOI: 10.2139/ssrn.3684945
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    Cited by:

    1. Lutz Bornmann & Russell J. Funk, 2025. "Popper’s probability calculus and the decline of scientific disruptiveness," Scientometrics, Springer;Akadémiai Kiadó, vol. 130(8), pages 4801-4807, August.
    2. Tetsugen HARUYAMA, 2021. "A Schumpeterian Exploration of Gini and Top/Bottom Income Shares," Discussion Papers 2125, Graduate School of Economics, Kobe University.
    3. Wim Naudé, 2023. "Late industrialisation and global value chains under platform capitalism," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 50(1), pages 91-119, March.
    4. Callaghan, Christian William, 2021. "Growth contributions of technological change: Is there a burden of knowledge effect?," Technological Forecasting and Social Change, Elsevier, vol. 172(C).
    5. Diane Coyle, 2021. "The idea of productivity," Working Papers 003, The Productivity Institute.

    More about this item

    Keywords

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    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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