Geographic isolation, trade secrecy, and innovation
Contigiani,Andrea Testoni,Marco
Contigiani,Andrea
Testoni,Marco
Abstract
This paper studies the impact of geographic isolation on innovation. Geographically isolated regions have lower access to distant knowledge and, thus, may be less effective in producing innovation. In addition, this effect may be moderated by frictions in the labor market, such as trade secrecy protection, that hinder access to local knowledge. To explore this argument, we build a comprehensive dataset of US CBSAs for the period 1971–2014, combining data on travel time, trade secrecy protection, and patenting activity. We find that geographic isolation has a substantial negative impact on innovation quantity and quality. This relationship is at least partially explained by lower access to existing knowledge, as geographic isolation hinders collaboration and, to some extent, mobility. The negative effect is especially pronounced in regions characterized by strong trade secrecy protection. Overall, the evidence suggests that the combination of geographic isolation and trade secrecy protection is detrimental to the innovation performance of regions.
Description
Publisher Copyright: © 2023 The Authors
Date
2023-10
Journal Title
Journal ISSN
Volume Title
Publisher
Research Projects
Organizational Units
Journal Issue
Keywords
patents, innovation, geographic isolation, travel time, trade secrecy, SDG 8 - Decent Work and Economic Growth
Citation
Contigiani, A & Testoni, M 2023, 'Geographic isolation, trade secrecy, and innovation', Research Policy, vol. 52, no. 8, 104825. https://doi.org/10.1016/j.respol.2023.104825
License
info:eu-repo/semantics/openAccess