Revealing the spatial extent of patent citations in the UK: How far does knowledge really spillover?

TL;DR

This paper investigates the geographical reach of patent citations in the UK to understand how far knowledge spillovers occur, revealing that most happen within extended commuting zones and vary by industry and over time.

Contribution

It provides empirical evidence on the spatial extent of knowledge spillovers using patent citations, highlighting the influence of institutional factors and industry differences.

Findings

Most knowledge spillovers occur within extended commuting boundaries.

Institutional factors significantly influence the probability of spillovers.

The spatial extent of spillovers has increased over time and varies by industry.

Abstract

Access to external knowledge sources through localized knowledge spillovers is an important determinant of the innovative capabilities of firms. However, the geographical extent of knowledge spillovers is not well understood. In this article we use patent citations in the UK as a proxy of knowledge flows and analyze the spatial extent of knowledge spillovers relative to the distribution of existing knowledge creation. We find that local, regional and country specific institutional factors play an important role in influencing the probability of knowledge spillovers and that most knowledge spillovers are exhausted within an extended commuting boundary. It is also shown that these effects have increased over time and that the spatial extent of knowledge spillovers varies by industry.