Geographic Constraints on Knowledge Spillovers: Political Borders vs. Spatial Proximity

36 Pages Posted: 25 Jan 2010 Last revised: 21 Jul 2017

See all articles by Jasjit Singh

Jasjit Singh

INSEAD; INSEAD

Matt Marx

Boston University - Questrom School of Business

Date Written: August 30, 2012

Abstract

Geographic localization of knowledge spillovers is a central tenet in multiple streams of literature. However, empirical studies have examined this phenomenon for only one geographic unit - country, state or metropolitan area - at a time, and have also rarely accounted for spatial distance. We disentangle these geographic effects by using a regression framework based on choice-based sampling to estimate the likelihood of citation between random patents. We find both country and state borders to have independent effects on knowledge diffusion beyond what just geographic proximity in the form of metropolitan collocation or shorter within-region distances can explain. An identification methodology comparing inventor-added and examiner-added citation patterns points to an even stronger role of political borders. The puzzling state border effect remains robust on average across analyses though is found to have waned over time. The country effect has, in contrast, not only remained robust over time but even strengthened.

Keywords: Knowledge Spillovers, Borders, Distance, Economic Geography, Patent Citation, Innovation

JEL Classification: O30, O33, R10, R12

Suggested Citation

Singh, Jasjit and Marx, Matt, Geographic Constraints on Knowledge Spillovers: Political Borders vs. Spatial Proximity (August 30, 2012). INSEAD Working Paper No. 2012/81/ST, Available at SSRN: https://ssrn.com/abstract=1541794 or http://dx.doi.org/10.2139/ssrn.1541794

Jasjit Singh (Contact Author)

INSEAD ( email )

1 Ayer Rajah Avenue
Singapore, 138676
Singapore
+65 67995341 (Phone)

HOME PAGE: http://faculty.insead.edu/singhj/

INSEAD ( email )

Boulevard de Constance
77305 Fontainebleau Cedex
France

Matt Marx

Boston University - Questrom School of Business ( email )

595 Commonwealth Ave
Boston, MA 02466
United States

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