Cycles of regional innovative growth

Abstract

Abstract For academics and policymakers invested in regional economic development, two pertinent questions are how innovative city-regions rise and whether it is inevitable that innovative city-regions will fall. Using data from 8 million patents granted to U.S.-based inventors between 1850 and 1999, this study describes a general process that city-regions undergo as innovation begins, expands, declines and (sometimes) resurges in regions. The results of the study show that inventors experiment with a small number of promising, diverse and non-local ideas in the years before innovation in their home regions begins to grow, that inventors build on early locally introduced ideas as innovation in their home regions expands, and that inventors experiment with relatively homogeneous sets of ideas shortly before innovation in their home regions declines. The results also show that declining U.S. city-regions rarely experience second waves of local innovative growth. However, when they do experience second waves, those waves are anticipated by changes in the knowledge sourcing strategies of local inventors. In particular, the years leading up to second cycles of regional innovative growth, local inventors experiment with promising, diverse and non-local ideas.