Spillover Geography Under the Microscope: Network-driven Transfers of Localized Knowledge Across Distance, Time and Political Boundaries

The article describes a number of operational and methodological contributions in the search for geographically localized knowledge spillovers. The unique focus is on the role of individual inventors, and to examine, at this fundamental level of innovative activity, the impact of geographic distance, time, and political boundaries on transfers of knowledge. The analyses exploit patent citations which I identify as network-driven transfers—citations for which transmission mechanisms emphasize repeat contact with prior inventors. The matching of inventor locations with geographic coordinates also makes use of information hitherto unexploited in patent data and lead to fine-scaled results. Tests for localized spillovers, proximity effects, and distance and state regressions reveal systematic patterns: Localization attenuates over time generally, but increases for intrastate citations. After controlling for geographic distance, spillovers of new knowledge are also increasingly likely to remain within state boundaries. Network-driven transfers are correlated with proximity effects which become increasingly important over time.