The Effect of Agglomeration on the Likelihood and Frequency of Patenting in U.S. Counties

This thesis examines the spatial distribution of patent activity and the effect that agglomeration and industrial diversity have on the likelihood and rate of patenting within U.S. counties. To examine patent activity we use a cross section of utility patents granted to U.S. and non-U.S. non-government organizations for each county in the contiguous U.S. during 1997. We analyze the effects that socio-economic characteristics of each county, including density, human capital, industrial diversity, and University R&D expenditures have on patent production. We find that two agglomeration measures, the density of the local labor pool as well as the density of establishments within an industry, contribute positively to innovative activity. In addition, we find that the likelihood and frequency of patent activity increase in counties that have a diverse set of industries.