How Do Inventors’ Political Preferences Affect Innovation?

Abstract

Team production in innovation has become increasingly important. Simultaneously, political polarization has been increasing over time. This paper examines how inventor political ideology affects innovation team formation and subsequent team innovative productivity. To examine these questions, we match North Carolina (NC)-resident inventors in the USPTO patent database to their voter registration records, which contain individuals’ political affiliation and aspects of their voting behavior. We also geolocate each patent assignee to create a risk-set of potential co-inventors in each organization location and in each county. Using a variety of estimation techniques, we describe both the regularities in the data and results from econometric analysis. We estimate that 62 percent of NC inventors are U.S. citizens, the vast majority of whom are male, white, and middle-aged. Republican (Democratic) inventors are overrepresented (underrepresented) in NC relative to the underlying distribution of voters in the state. Citizen-inventors are highly politically engaged, more so on almost every dimension than the average of citizens. Republican inventors pursue different technologies than Democratic inventors. In econometric estimations we show that there is political homophily within co-invention teams: Democrats (Republicans) tend to form teams with other Democrats (Republicans). We also assess the performance of granted patents of innovation teams. In both reduced-form estimations and estimations that instrument for endogenous team formation, NC-based Democratic ideologically homogenous teams tend to outperform Republican ideologically homogenous teams and ideologically heterogeneous teams in patent forward citations and patent renewals, although some of these effects are sensitive to the fixed effects included.

Keywords: political polarization, innovation, patents, teams, inventors

JEL Classification: L2, O3, D7