Spreading the Word: Geography, Policy and Knowledge Spillovers

Using new data on citations to university patents and scienti…c publications, we study how geography a¤ects university knowledge spillovers. Citations to patents decline sharply with distance up to about 150 miles and are strongly constrained by state borders. Distance also constrains citations to scienti…c publications, but the impact is less sharp and persists over greater distances. The state border e¤ect for publications is signi…cant only for lower quality public universities. We show that the state border e¤ect is heterogeneous, and is strongly in‡uenced by university and state characteristics and policies. It is larger for public universities and those with strong local development policies. The border e¤ect is larger in states with strong non-compete laws that facilitate intrastate labor mobility, states with greater reliance on in-state educated scientists and engineers, and states with lower rates of interstate scienti…c labor mobility. We also con…rm the impact of non-compete statutes by studying a policy reform in Michigan. Keywords: knowledge spillovers, di¤usion, geography, university technology transfer, patents, scienti…c publications JEL Classi…cation: K41, L24, O31, O34 We would like to thank two referees and the Editor for very constructive suggestions on an earlier version of the paper. We also thank Ajay Agrawal, Saul Lach, Jacques Mairesse, John Van Reenen and participants in the 2009 NBER Summer Institute for helpful comments. We gratefully acknowledge the …nancial support of the Centre for Economic Performance at the London School of Economics, and the Muzzy Chair for Entrepreneurship at the University of Arizona, which made it possible for us to construct the data sets used in this project. Finally, we thank Hadar Gafni and Kristy KyuSeon Lee for excellent research assistance during this project.