Seminar  |  06/11/2019 | 12:00 PM  –  01:30 PM

Brown Bag Seminar: Knowledge Assessibility and Cumulative Innovation: Evidence from a Network-Econometric Analysis of the Introduction of the British Penny Post in 1840

Martin Schmitz (Vanderbilt University)

Max Planck Institute for Innovation and Competition, Munich, Room 313

I use newly-collected, georeferenced network panel data to study how an exogenous increase in the efficiency of exchanging knowledge affected follow-on innovation. Specifically, I examine how the introduction of inexpensive, distance-independent postage via the British Penny Postage Act of 1839 influenced the formation of links within a network of prominent British scientists. Link formation is citation-based and hence indicative of cumulative innovation. I use two-period extensions of the network formation model proposed by Graham (2017, ECMA) to identify the impact of the reform. I can distinguish between a postage reduction effect and a quality improvement effect. The model allows me to control for fixed effects for the citing and cited scientists and to take into account the existence of previous links, the efficiency of transportation, and the proximity of scientists' research areas. The model is estimated with Graham's (2017) tetrad logit estimator. (This project is work in progress.)

Contact person: Michael Rose