Crossover Inventions and Knowledge Diffusion of General Purpose Technologies: Evidence from the Electrical Technology

Abstract

Scholars have long noted the significant impact of general purpose technologies (GPTs) on the economy. However, limited attention has been paid to exploring how they are employed to generate inventions in downstream sectors (crossover inventions), and what factors may facilitate such diffusion. In a study of the introduction of electrical technology in the late-nineteenth-century United States, we find that knowledge spillovers between industries had little influence on the geography of crossover inventions as well as the speed and productivity of crossover inventors. Instead, human capital and an environment promoting inventions in general were more important.