PEPP Seminar (June 23rd, 2022): “Marshall Meets Bartik: Revisiting the Mysteries of the Trade (with Yasusada Murata)”
2022/05/20
By Dr. NAKAJIMA Ryo, Professor, Professor, Department of Economics, Keio University
Date： Thursday, June 23, 2022
Time： 16:45～18:15 (JST)
Venue： Onsite (University of Tsukuba)
Room 3A308
ABSTRACT
This paper reexamines Marshall’s “mysteries of the trade.” He highlighted the importance of knowledge spillovers and described it as “the mysteries of the trade are as it were in the air.” But are they really in the air? If so, how large are they, and how can they be facilitated? To answer the questions, we estimate the causal impact of superstar inventor migrations to a city on the number of inventions in the same city. We develop a new identification strategy based on inventors’ propensities to migrate from higher-tax places to lower-tax places. Using the predicted probabilities of top inventors between the U.S. commuting zones as shares, we perform a Bartik-style (or shift-share-style) instrument variable estimation. The analysis reveals that in the United States, from 1977 to 2009, a superstar inventor who moved to a commuting zone increased the patent productivity of the local inventors by about 3-5 percent.
