How the West Has Won: Regional and Industrial Inversion in U.S. Patent Activity
Wellesley College Working Paper No. 2002-09
21 Pages Posted: 6 Feb 2003
Date Written: October 2002
While it is clear that there has been a "regional inversion" in American patent activity over the past 25 years (i.e. relative rise of the Northwest and Southwest at the expense of the traditional invention hotbeds of the Northeast and Midwest), the reason is still open to speculation. Intuition suggests that it can be explained by some combinaion of changing demographics and industrial composition. We introduce constant market share analysis (CMSA), typically used only in international trade theory, offering a new extention to this tool, and conclude that industrial shifts have accounted for almost half of the regional inversion. Regression results show how the West capitalized upon the shift using demographics and policy variables, whose importance vary with the planning horizon.
Keywords: invention, geography, clustering, regional inversion, constant market share analysis
JEL Classification: L0, O30, O38, R11, R12, R15
Suggested Citation: Suggested Citation