Collaborative Research: The financial impact of inventor migration on individuals and regions

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Silicon Valley contributes an increasingly disproportionate amount of innovation and entrepreneurship to the U.S. economy.  If this trend continues, regional innovation inequality in the United States will almost certainly be exacerbated. Large segments of the nation?s potential scientific workforce might fail to develop, or might be overlooked, if innovation is concentrated only in a few regions. This project examines how the intra and inter-regional mobility of engineers contributes to this process.  Among the many explanations given for the rise of Silicon Valley to entrepreneurial and economic prominence is its high-velocity labor market, in which workers are more loyal to their profession than to any particular firm. However, companies clearly want to retain their employees, both to recoup training investments and also to block them from aiding rivals. This study will examine how intra-regional mobility influences firm innovativeness, while also considering whether those employees might have done better to start their own firm.  A region's overall welfare may also benefit from increased mobility.  Inter-regional mobility also affects the innovativeness of regions.  Concentration of innovation in a high tech region, if the best inventors migrate, will likely increase regional innovative inequality.  Migration not only between regions but also between firms may affect inequality at the individual level as well. Workers may profit from loyalty to their employer in that they become uniquely valuable by developing firm-specific human capital, which would be lost if they left for another organization, but it may prove more financially attractive for workers to explore the labor market outside their current firm.  The primary data for this study will be patent holders. The project will first curate a database of all inventor moves between firms and regions, based on U.S. patents from 1976-2019. Although such might seem straightforward, lack of unique identifiers as well as other subtleties of patent records render the determination of moves non-trivial. For example, inventors sometimes assign patents to multiple firms or file a series of patents at a set of alternating firms such that it appears the inventor is bouncing and forth between two employers. Next, the project will analyze trends in the regional migration of inventors and assess the impact on productivity and inequality of such moves. Given that moves are not random, outside factors influencing mobility such as changes in employment laws and natural disasters will be utilized. These resulting databases will also support dynamic visualization of inventor mobility across all U.S. counties and time periods. Mobility will also be illustrated with heat maps, illustrating net losses and gains of inventors across all U.S. counties of the same time period and technology category. Ultimately, policymakers will be able to visualize and inspect trends in regional innovation inequality and determine which technical fields are becoming regionally concentrated vs. dispersed. All data will be made available to the public.