Flow of Ideas: Economic Societies and the Rise of Useful Knowledge

108 Pages Posted: 15 Jul 2022

See all articles by Julius Koschnick

Julius Koschnick

London School of Economics & Political Science (LSE)

Erik Hornung

University of Cologne - Center for Macroeconomic Research (CMR); CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Francesco Cinnirella

University of Bergamo; University of Southern Denmark - Department of Business and Economics; CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute; Centre for Economic Policy Research (CEPR); CAGE

Date Written: 2022

Abstract

Economic societies emerged during the late eighteenth-century. We argue that these institutions reduced the costs of accessing useful knowledge by adopting, producing, and diffusing new ideas. Combining location information for the universe of 3,300 members across active economic societies in Germany with those of patent holders and World’s Fair exhibitors, we show that regions with more members were more innovative in the late nineteenth-century. This long-lasting effect of societies arguably arose through agglomeration economies and localized knowledge spillovers. To support this claim, we provide evidence suggesting an immediate increase in manufacturing, an earlier establishment of vocational schools, and a higher density of highly skilled mechanical workers by mid-nineteenth century in regions with more members. We also show that regions with members from the same society had higher similarity in patenting, suggesting that social networks facilitated spatial knowledge diffusion and, to some extent, shaped the geography of innovation.

Keywords: economic societies, useful knowledge, knowledge diffusion, innovation, social networks

JEL Classification: N330, O330, O310, O430

Suggested Citation

Koschnick, Julius and Hornung, Erik and Cinnirella, Francesco, Flow of Ideas: Economic Societies and the Rise of Useful Knowledge (2022). CESifo Working Paper No. 9836, Available at SSRN: https://ssrn.com/abstract=4163325 or http://dx.doi.org/10.2139/ssrn.4163325

Julius Koschnick

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

Erik Hornung

University of Cologne - Center for Macroeconomic Research (CMR) ( email )

Cologne
Germany

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Munich
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Francesco Cinnirella (Contact Author)

University of Bergamo ( email )

Via dei Caniana 2
Bergamo, 24129
Italy

University of Southern Denmark - Department of Business and Economics ( email )

DK-5230 Odense
Denmark

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschingerstrasse 5
Munich, 81679
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

CAGE ( email )

Premier Business Centre
47-49 Park Royal Road
London, NW10 7LQ
United Kingdom

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