Co-patenting and inventive performance: in search of the proximity paradox

1. Co-patenting and inventive performance: in search of the proximity paradox Lorenzo Cassi Université Paris 1, CES & OST Anne Plunket Université Paris Sud 11, ADIS

2. Geographical (and other forms of) proximity and networks Aim of the paper: • Consider the joint impact of network and proximity factors and • Contrast their impact on • Collaboration through co-inventor dyad formation • Inventive performance through forward citations

3. Geographical (and other forms of) proximity and networks The role of geographical proximity • Knowledge diffusion and innovation are highly localized and embedded in industrial clusters • Long studied through knowledge externalities and their impact on knowledge creation (Jaffe, 1989; Audretsch and Feldaman, 1996) • Under what conditions individuals and firms benefit from knowledge externalities? The role of networks as Channels of knowledge diffusion • Social proximity : individuals need to be embedded in networks: knowledge flows follow inter-personal links build through mobility, co-ethnicity, friendship, etc. (Almeida & Kogut, 1999; Agrawal et al., 2008; Breschi and Lissoni, 2009;) • Networks are local to the extent that individuals are not very mobile (Breschi and Lissoni, 2009) • Other forms of proximity mediate knowledge diffusion: organizational and technological proximity(Boschma, 2005, Nooteboom, et al. 2007)

4. Geographical (and other forms of) proximity and networks Other forms of proximity: substitutes or complements • Other forms of proximity mediate knowledge diffusion • organizational proximity and technological proximity (Boschma, 2005) • Social, organizational and geographical proximity are substitutes: similar roles in favoring learning and knowledge sharing In sum: • Individuals need proximity to become connected, to share knowledge • Various forms of proximity may act as substitutes or complements • Individuals need to be embedded in networks What about network positions ?

5. Networks and knowledge Network positions are important to access knowledge and resources: • Closure positions (= within component)- Coleman, 1988 • Share social proximity : have partners in common ; closure positions are highly localized (TerWal, 2011) • Cohesive networks: reduce coordination cost and promotes trust and collaboration • Risk of redundancy: similar knowledge bases and technological skills • Bridging positions (=across components) - Burt, 1992 • Brokerage position: link between separate components; channel across clusters • Access non redundant and novel sources of information and knowledge • Promote creativity and provide opportunities for novel combinations • “Weak ties”: difficult to coordinate and mobilize (but possibly compensated through other forms of proximity to reduce uncertainty)

6. The proximity paradox? • Network relations and proximity are “facilitators” of coordination, knowledge sharing and diffusion, they do not necessarily favor innovative performance (Boschma and Frenken, 2009) • Too much proximity may be harmful for innovation • Technological capabilities and cognitive/technological proximity play a more prominent role (Nooteboom, et al. 2007, Broekeland Boschma, 2011)

7. Data and network construction method • EPO patents in genomics (1990-2006) – ANR Corpus genomic with OST-INRA-ADIS - from Patstat • All co-inventor dyads between inventors reporting a European postal address (EU15 and Switzerland and Norway- 12,968 patents – 4406 applicants – 24,708 inventors • Network built using five-year windows (links die out): network in 1994 is built on patents published between 1990 and 1994 • All ties and potential ties • To avoid simultaneity biases, we consider all proximity determinants with a lag of one period • We investigate only links among already active actors – bridging and intracomponent ties

8. Independent variables and controls Unit of analysis:co-inventor dyads (closure or bridging dyads) • Proximity variables based on inventors’ individual characteristics (previsous period) • Geographical proximity: geographical location of inventors at the NUTS 3 level - • Organizational proximity • Same applicant: within the same governance structure - (private company, research institutes and universities, non for-profit organizations and individuals • Same organizational type: between firms or between academics • Technological proximity : Jaffe Index based on IPC codes • Social proximity between already indirectly connected inventors (when social distance is == 2, 3 and 4) • Control variables • Average and absolute degree (preferential attachement) • Average and absolute experience (time since first patent) • Border (neighbor countries) • Number of inventors • Cosureand bridging patent: Mixed ties

9. Dependent variables and estimation 1. The likelihood of collaboration How proximity (spatial, social, cognitive, organizational and institutional proximity) affect the choice of collaboration partners? • Tie formation using a conditional logit model – tie versus no tie formation • for any observed tie, we randomly select five possible but not realized co-inventor ties, which provide five controls for each co-inventor • Dyad formation using • conditional logit = f(proximity, proximity interactions, controls) 2. The value of inventions: How proximity affect the value of patents? • Number of citations per patent as a proxy for the value of an invention (Harhoff, et al. 2003; Gambardella, Harhoff, and Verspagen, 2008) • Citations based on patent families – 5 years - (Martinez, 2010, OECD) • # forward Citations using • negative binomial = f(proximity, proximity interactions, controls)

10. Network tie formation regressions

11. Tie formation

12. Tie formation with social proximity

13. Tie formation with social proximity - cont

14. Inventive performance - Citations regressions

18. Conclusion • Results confirm previous studies on: • Collaboration and knowledge flows • Social, organizational and geographical proximity are substitutes • Outside the governance structure, organizational and geographical proximity are complements • The various forms of proximity strongly explains the formation of networks and geography remains important even after controlling for other forms of proximity • Innovative performance and the proximity paradox • Geographical and organizational proximity is not significant • Too close social proximity is negative for closure ties • Technological proximity has a key role; it has an inverted u-shape • Less close proximity is more beneficial for bridging ties

19. Thank you very much for your attention!

20. Inventors and patent by country (fractional and cumulative counting)

21. Citations include self-citations