Company-College Co-Location: Do Universities Create Local Innovation Clusters?

67 Pages Posted: 26 Dec 2019 Last revised: 30 Mar 2021

See all articles by Constantin Charles

Constantin Charles

University of Southern California - Marshall School of Business

Date Written: March 29, 2021

Abstract

I show that firms produce more valuable patents when they are located close to a university or land-grant college. Land-grant colleges were established in as-good-as-random locations in the 19th century, allowing me to rule out reverse causality and omitted variables as explanations. To understand the mechanism, I show that firms whose executives are more connected to a land-grant college produce more valuable patents, pointing toward executive networks as an important channel for spillovers. I strengthen these findings by using large donations from alumni as exogenous shocks to university research. The resulting increases in university research mainly benefit connected firms.

Keywords: Innovation, Patent value, Universities, Knowledge spillovers

JEL Classification: R3, I2, G3

Suggested Citation

Charles, Constantin, Company-College Co-Location: Do Universities Create Local Innovation Clusters? (March 29, 2021). Available at SSRN: https://ssrn.com/abstract=3499277 or http://dx.doi.org/10.2139/ssrn.3499277

Constantin Charles (Contact Author)

University of Southern California - Marshall School of Business ( email )

701 Exposition Blvd
Los Angeles, CA California 90089
United States

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