Cemmap Working Paper (CWP55/17)

Knowledge spillovers and patent citations: trends in geographic localization, 1976-2015

Date: 06 December 2017
Publisher: The IFS
JEL classification: C36, C81, O33, O34, O51

This paper examines the trends in geographic localization of knowledge spillovers via patent citations, considering US patents from the period of 1976-2015. Despite accelerating globalization and widespread  perception of the "death of distance," our multi-cohort "matched-sample" study reveals signi cant and growing localization effects of knowledge spillovers at both intra- and international levels after the 1980s. We also develop a novel network index based on the notion of "farness," which an instrumental variable estimation shows to be a signifi cant and sizable determinant of the observed trends at the state-sector level.