Geography of Innovation

Matt Clancy

This post provides a quick overview of claim articles in New Things Under the Sun related to the geography of innovation: how place affects innovation. It is designed more to help you quickly see what an article discusses, rather than to highlight the most important conclusions or takeaways.

Click one of the following links to jump to an article overview, or simply scroll down. Click on the title of any given overview to jump to the associated claim article on New Things Under the Sun.

Innovation at the Office

There are two potential advantages to having people work in close proximity:
- a "communication advantage" that allows people to easily talk face-to-face and
- a "discovery advantage" that allows people to easily meet new people who are sitting next to them.
Research on the effects of colocation of labs, startups, and bootcamp teams has shown that putting together people who don't know each other but work on somewhat related stuff is likely to increase collaboration, while putting people who already know each other is not.
Additionally, the post suggests that shifting people around so that their nearest neighbors change from time-to-time can also force more mixing, and using hybrid work arrangements, such as an annual retreat, to reap most of the benefits of discovery.

Local Learning

Looks at two studies that on the benefits of co-location for deep engagement with intellectually distant work and the increasing returns to local collaboration over time.
- Scientists are more likely to write papers on new research topics after working with a local collaborator, than a remote one
- Scientists report are more likely to report citations are highly influential if the author is local and the cited reference more intellectually distant
The article suggests local collaboration affects research through the initiation of new projects and the amount of knowledge shared, with local collaboration being more likely to lead to writing on new topics in the future.

Studies have found that cities, particularly areas with high population density, are more conducive to innovation, as measured by the number of patents produced per capita.
Others find that denser parts of the country tend to house inventors working on many different kinds of technology, and that the inventions and patents that emerge from these areas tend to reflect unusual combinations of knowledge.
One study finds that higher density of walkable streets, especially with more restaurants, cafes, and bars, had a positive correlation with more patents and more likely patents to cite other patents from the same census block.
Access to places like bars that facilitate socializing, mixing, and exchanging ideas, also seems to contributes to innovation.

Free knowledge and innovation

The studies discussed in this post suggest that improved access to knowledge can boost innovation.
They show that access to libraries, patent libraries and Wikipedia can have a positive impact on the number and character of patents and scientific research.
The evidence related to libraries come from comparing communities or regions that have access to those resources with those that don't.
The evidence related to wikipedia draws on text analysis, citations, and the outcomes of an experiments to create wikipedia articles related to some randomly selected chemistry topics.

Importing Knowledge

The article discusses the impact of knowledge worker migration on innovation in science and technology.
Various case studies show that immigration can have a significant positive impact on innovation in new fields.
A study across many countries and technological categories found that when a country has technological strength in a certain area and scientists and engineers immigrate to another country, that country's strength in that area increases.
The studies indicate that the impact of immigration on innovation is greater than the activity of the migrants themselves due to the knowledge and ideas they bring with them from their home countries.

Innovators who immigrate

The post looks at the impact of migration on the productivity of scientists and inventors.
Moving to countries with high levels of resources and collaboration opportunities, such as the USA, can lead to an increase in the production of science and invention.
Migration restrictions and more specifically, lack of funding and support for scientific research have a significant effect on productivity.
The results show that moving to wealthy countries leads to a significant increase in the production of science and invention.

Academic conferences and collaboration

Looks at the impact of conferences on academic collaboration.
Some studies found that attending conferences increases the likelihood of collaboration and the production of joint publications.
This effect is stronger for attendees who interact more frequently during the conference and for those who attend smaller, topic-focused conferences.
Other studies have found that the impact of attending a conference depends on the intellectual proximity of attendees and can even have a negative impact on the likelihood of future collaboration.

Increasingly distant knowledge spillovers

The idea that innovators in big cities have better access to knowledge and ideas due to their proximity to more people is called "local knowledge spillovers".
- Recent studies have cast doubt on the continued strength of this concept.
The probability of a local patent citing another local patent has declined, and the advantage of big cities in generating novel technology combinations has also declined.
Big cities are no longer using younger, more novel ideas as much as they used to.
Overall, the evidence suggests that the advantage of big cities in innovation has been declining.

Transportation and innovation

The strength of local knowledge spillovers is decreasing as travel becomes easier, making it less important to live near people with complementary knowledge.
Research across various modes of transportation (planes, trains, subways, and automobiles) shows that easier transportation leads to an increase in collaboration and knowledge exchange between individuals in different cities.
In the case of roads, building more highways results in an increase in regional patents, but this also leads to greater distances between patents and increased local-but-not-that-local knowledge flows.
These findings suggest that technological advancements in transportation erode the importance of local knowledge spillovers.

The internet, the postal service, and access to distant ideas

After two establishments were connected to the internet, inventors in those establishments were more likely to be jointly listed on patents and to cite each other’s patents.
Internet access also reduces the trend towards geographic concentration of innovative activity, benefiting people in less innovative regions by allowing them to participate in the innovation economy through finding good collaborators.
Relatedly: the 1840 drop in the price of mail in Great Britain seems to have increased citations between towns, reduced the "distance" penalty by 70%, and led to a larger increase in patents in more remote towns.

Remote breakthroughs

Remote work has long been considered suitable for knowledge work but not for collaborative creativity in breakthrough innovation, but advances in remote collaboration technology have challenged this view.
Studies have shown that physical proximity can play an important role in forming new relationships and facilitating novel combinations of ideas.
Remote work might not provide the same exposure to new people and ideas as colocated work.
But remote teams may be exposed to a wider range of ideas and end up producing more disruptive work via this mechanism.

Why proximity matters: who you know

Being close to others is important in meeting new people and forming relationships, but close proximity is not essential for maintaining these relationships or facilitating innovation.
When an inventor moves, they are more likely to receive citations from their previous location, especially from those they worked with or for the same organization.
Another study used Facebook data to study the role of informal ties in the transfer of knowledge and found that cross-county friendships mediate the effect of distance on citations.
The existence of social ties, such as advisor-advisee relationships, is a strong predictor of citations in academic math, while physical proximity has become a less important predictor since the year 2000.
Overall, the studies suggest that proximity plays a role in initiating new relationships but distance does not hinder established relationships from continuing to innovate.

An example of successful innovation by distributed teams: academia

Proximity was (and perhaps still is) important for forming collaborative working relationships in academia, but these relationships remain productive even when academics are far away from each other.
At the same time, the ever-rising set of knowledge needed to push the frontier and the increasing specialization of academics has pushed them to collaborate remotely more often.
Falling travel and communication costs have also favored building teams with remote colleagues with the right specialization.
While it is feasible to collaborate productively at a distance in academia, face-to-face interactions are still important for meeting new people and forming relationships.