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on Technology and Industrial Dynamics |
| By: | Margherita Gerolimetto (Ca’ Foscari University of Venice); Stefano Magrini (Ca’ Foscari University of Venice); Alessandro Spiganti (University of Genoa) |
| Abstract: | We study the causal effect of the local supply of sector-specific innovators on patenting activity across US metropolitan areas, distinguishing between innovators active in carbon-intensive ("brown") and environmentally sustainable ("green") technological fields. Using USPTO patent data from 1990 to 2016, we document a marked shift in the geography of green innovation: while brown patenting has long been concentrated in established hubs, green patents — initially more dispersed — have increasingly converged toward the same locations. We build a theoretical framework in which local patenting activity is driven by the supply of green and brown innovators, investigating how their interaction shapes the innovation process. Empirically, we address endogeneity using a shift-share instrument that combines predetermined local technological specialization with exogenous shocks to foreign innovation across CPC sections. We find that a one-unit increase in the local supply of brown innovators raises patenting activity by approximately 0.8%, an effect that is robust across specifications. Together, these findings suggest that green innovation is becoming increasingly embedded in existing agglomeration ecosystems, with important implications for place-based climate policy. |
| Keywords: | agglomeration, climate change, innovation, spatial distribution, patents |
| JEL: | O31 O33 O44 O47 R11 R12 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ven:wpaper:2026:14 |
| By: | Toshihiro OKUBO; Alexander F. WAGNER; Kazuo YAMADA |
| Abstract: | Innovation is central to productivity growth, yet firms facing similar technological and policy environments differ in their R&D investment behavior. We examine whether persistent regional social norms help explain this variation. Using prefecture-level data from Japan, we measure regional conformism based on a 1941 military conscription examination and contemporary school education surveys, demonstrating that regional differences have persisted over time. Linking them to data on all Japanese manufacturing firms from 1995 to 2022, we find that firms in more conformist regions exhibit significantly lower R&D intensity even after controlling for cognitive ability, firm characteristics, and fixed effects. The relationship with patenting is weaker and less robust. To isolate the historical component of conformity, we instrument pre-war conformism using differences in domain-level educational curricula during the Edo-period (1603–1868). The IV results similarly indicate a significant negative effect on firms’ R&D intensity. Overall, the findings suggest that persistent regional social norms are most strongly related to firms’ innovation investment rather than realized innovation output. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:eti:dpaper:26033 |
| By: | Hottenrott, Hanna; Schaper, Thomas; Schwierzy, Julian |
| Abstract: | Competitive public research funding is an important policy instrument to foster scientific progress. The effective design of such funding schemes and whether they generate knowledge spillovers to industrial inventions, however, remains debated. In this paper, we investigate the impacts of geographically localized forum grants - Clusters of Excellence - awarded for additive manufacturing research under Germany's Excellence Initiative from 2006-2012. Using synthetic difference-in-differences estimation, we find that Clusters increased local scientific output in funding-related domains in the right tail of the scientific impact distribution - as measured by article citations - compared to non-funded applicant groups in similar locations. While patenting by nearby firms remained unaffected at the extensive margin, we find evidence for significant knowledge spillovers to local industry. These manifested as a rise in the number of high-impact firm patents confined to related technical areas, and Clusters receiving a significantly larger number of prior art citations from industry patents, compared to the control group, which were geographically localized and confined to top publications. Our findings support the effectiveness of forum-based funding programs for top science and provide dual implications for research and industrial policy. |
| Keywords: | Frontier science, research funding, knowledge spillovers, industry-science linkages |
| JEL: | I23 O31 O38 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:340105 |
| By: | Jullien, Bruno; Bedre Defolie, Özlem; Biglaiser, Gary |
| Abstract: | We study a startup’s choice of its “direction of innovation, ” how well the technology fits alternative acquirers, and the effects on acquisition outcomes and market dominance. Two horizontally differentiated firms bid to acquire the innovation and then compete in the product market. Firms differ in initial quality stock and in “absorption capabilities, ” how effectively the acquired innovation is integrated into their stock. The innovator designs the innovation to intensify bidding by putting firms on a more equal footing, thereby favoring the initially lower-quality firm. As a result, “increasing dominance” is less likely than under exogenous fit. The winner of the innovation is driven primarily by relative absorption capabilities rather than initial quality: the f irm with higher absorption capability is more likely to win. The equilibrium innovation direction minimizes industry profit and consumer surplus. In a two-period model, decreasing dominance becomes more likely when the low-quality firm has stronger absorption capabilities. |
| Date: | 2026–04–20 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:131684 |
| By: | Steven J. Davis; Nicholas Bloom; Mihai A. Codreanu |
| Abstract: | COVID-19 brought a sharp, unanticipated increase in the usefulness and value of technologies that support work from home (WFH). To investigate how this shock influenced the direction of technical change, we examine the text in 5.6 million U.S. patent applications published from 2010 to 2026. The share of patent applications that advances technologies in support of WFH rose by about two thirds within three years after the pandemic struck and remains about 50% above pre-pandemic levels five years later. The lasting rise in the WFH share of new applications concentrates in telecommunications – especially video conferencing, speech recognition, and audio processing. It is driven overwhelmingly by US corporations rather than foreign assignees or universities. In short, we find evidence that a sudden, lasting rise in WFH redirected innovation to technologies that support it. |
| JEL: | J22 L63 O31 O33 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35083 |
| By: | Duran-Vanegas, Juan |
| Abstract: | This paper examines the relationship between artificial intelligence (AI) adoption and firm-level productivity growth in a middle-income economy. Combining data on AI use from the 2019 Colombian Enterprise ICT Survey with longitudinal manufacturing data, I estimate productivity growth differentials between adopters and non-adopters while accounting for pre-adoption characteristics and productivity trajectories using entropy balancing. AI adoption is associated with a 16 percent cumulative increase in labor productivity over 2016–2019, equivalent to roughly 5 percent annualized growth. These differentials appear to be driven by higher sales and value added rather than reductions in costs or employment, are similar among in-house and outsourced AI developments, and increase for firms with higher pre-existing technical capabilities. Finally, the analysis points to changes in organizational structure as a potential adjustment margin. AI adoption is associated with a small but significant decline in the share of administrative workers, suggesting a reallocation of tasks away from administrative functions. |
| Date: | 2026–04–17 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:64nmf_v1 |
| By: | Kumar Rishabh; Vatsala Shreeti |
| Abstract: | In this paper, we trace the geography and economic characteristics of firms that produce artificial intelligence (AI) products and services. Many economies around the world are evaluating their strategic priorities in AI, yet relatively little is documented about the global distribution of AI production. We construct a new database that identifies 1, 246 AI-producing firms across 32 economies. We map these firms in each economy into the five layers of the AI supply chain: compute, cloud and related infrastructure, data tools, AI models and AI applications. The biggest markets for AI production are China and the US. Most economies specialise only in a few supply chain layers and many focus largely on compute. AI firms in all economies exhibit strong home bias in investment activity, with a focus on downstream applications. Finally, we find that venture capital inflows are strongly correlated with the presence and density of AI firms in a given economy. |
| Keywords: | artificial intelligence, AI supply chain, firm geography, AI measurement |
| JEL: | O33 C81 L86 F23 L16 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:bis:biswps:1343 |
| By: | Yadav, Anil (Central Bank of Ireland); McHale, John (University of Galway, Ireland); Galetti, Jefferson RB (University of Galway, Ireland) |
| Abstract: | This paper examines how skill mismatch, particularly in digital skills, constrains occupational mobility. Using worker transition data from the Irish Labour Force Survey and skill vectors from the ESCO database, we construct occupation-level mismatch measures and estimate their effect on worker flows in a framework combining matching and gravity models. Greater skill mismatch significantly reduces occupational mobility, with stronger constraints on transitions between digitally intensive occupations. We also document substantial heterogeneity in bilateral mobility costs and show that occupations that are easier to enter are harder to exit, creating bottlenecks. These findings highlight the importance of retraining policies, especially those supporting digital skill acquisition, to improve labour market adaptability |
| Keywords: | Occupational Mobility; Skill mismatch; Tasks; Mobility costs. |
| JEL: | J24 J62 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:cbi:wpaper:04/rt/26 |
| By: | Lindner, Attila (University College London); Muraközy, Balázs (University of Liverpool); Reizer, Balázs (ELTE - Centre for Economic and Regional Studies); Schreiner, Ragnhild (University of Oslo) |
| Abstract: | We quantify the contribution of firm-level technological change to skill demand and aggregate inequality in the presence of imperfect competition in the labor market. We show that skill-biased technological change increases both the firm-level skill ratio and the skill premium, while other shocks (e.g. firm-specific output demand shocks) cannot explain the increase in both outcomes. We exploit administrative data and a large survey measuring a broad class of firm-level technological changes from Hungary and Norway. We estimate that the aggregate college premium increases by 3.4% in Norway and by 4.9% in Hungary as a result of the skill bias in technological change. |
| Keywords: | skill-biased technological change, innovation, skill premiums, imperfect competition |
| JEL: | J31 J24 O30 O33 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18516 |
| By: | Hutschenreiter, Dennis |
| Abstract: | Firms increasingly rely on markets for technology to acquire innovations developed outside their boundaries, yet acquiring intellectual property rights alone often does not guarantee successful implementation. Many technologies depend on tacit know- how that must be supplied by the provider after the transaction is completed. This paper examines whether common ownership between a technology provider and a potential adopter mitigates this implementation problem. I develop a model in which overlapping institutional investors cause the provider to partially internalize the adopter's gains from successful implementation, strengthening incentives to transfer tacit know-how. This mechanism operates only when know-how is unverifiable - absent this friction, common ownership leaves matching and outcomes unchanged. Under moral hazard, the model predicts that common ownership increases the likelihood of technology transfer to a given adopter, that this effect is stronger when tacit know-how is more important, and that common ownership improves post-transfer outcomes conditional on adoption. I test these predictions using U.S. patent reassignments between publicly traded firms. Using within-deal variation across competing potential adopters and plausibly exogenous variation from passive index-fund holdings, I show that common ownership increases the likelihood that a firm acquires a technology, particularly when the transferred bundle is more tacit. Common ownership predicts stronger subsequent innovation and higher future firm value, especially when ownership overlap is concentrated among investors with stronger incentives to monitor the provider. These findings show how ownership structure shapes interfirm technology transfer by affecting not only who acquires a technology, but also how much value is created. |
| Keywords: | common ownership, institutional investors, moral hazard, patent reassignments |
| JEL: | C78 D82 G23 L24 O34 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:iwhdps:340107 |
| By: | OECD |
| Abstract: | Critical minerals such as lithium, cobalt, nickel, copper, graphite and rare earth elements are poised to play an increasingly important role in environmental sustainability, emerging technology and defense applications. Innovation can play a vital role in reducing primary demand for them while reducing associated supply chain risks and providing benefits for the environment and human health. This paper examines the intersection of technological innovation, critical raw materials and economic policy. It draws on a review of academic and non-academic literature to analyse the key drivers of innovation in the critical raw material supply chain, as well as how innovation might help drive the reforms needed to establish more secure supply networks and sustainable business practices. It then develops a conceptual framework for categorising innovation across the value chain and types of innovations before assessing emerging policy challenges and opportunities for governments. |
| Keywords: | Batteries, Critical materials, Critical mineral, Critical raw material, Innovation, Materials security, Mining, Rare earth elements, Resource scarcity, Supply chain |
| JEL: | O30 Q55 Q58 O38 |
| Date: | 2026–04–27 |
| URL: | https://d.repec.org/n?u=RePEc:oec:envaaa:273-en |