Abstract
This paper explores a newly emerging source of data on the occurrence and spread of innovations drawn from descriptions of goods and services in the US trademark register. Using these data we describe patterns of regional innovation in the United States and study the effect of distance on the early diffusion of innovations. To identify innovations and their locations we tokenize trademark descriptions and identify novel, fast spreading tokens (words). While trademarks appear to capture many innovations missed in patents, among tokens that co-occur in patent documents the diffusion dynamics for patents and trademarks are similar. We also find that fast growing new tokens are frequently new to English, and their use in language co-evolves with the frequency of linked patents and trademarks. Finally, we show that regional incidence of new tokens parallels patterns of inventive activity reflected in patent data. We exploit occurrence of new trademark tokens to re-examine how spatial distance affects the diffusion of innovations in the U.S. economy. Aggregating innovations at the year and census tract level we estimate Poisson models of diffusion intensity between locations, revealing persistent, strong and negative effects of distance on the intensity of diffusion between locations within the US.
Highlights
The scholarly consensus holds that geographical distance affects the intensity of trade and migration patterns, and the diffusion of ideas and innovations (Clark et al, 2018). Kolko (2000) noted that the reduction in communication costs and improvements in the speed and quality of interactions might lead to the “death of distance,” and possibly an end to agglomeration effects, but found evidence only to support the former
While this paper considers U.S trademark information generated during only three decades, there is wide scope for this measure to be constructed from public trademark information in any country, and for periods beginning as early as the late-1800s
While the consensus scholarly view is that the diffusion of ideas and innovation decreases as spatial distance increases, recent scholarship questions this relationship
Summary
The scholarly consensus holds that geographical distance affects the intensity of trade and migration patterns, and the diffusion of ideas and innovations (Clark et al, 2018). Kolko (2000) noted that the reduction in communication costs and improvements in the speed and quality of interactions might lead to the “death of distance,” and possibly an end to agglomeration effects, but found evidence only to support the former. We examine the introduction of new words (tokens) among the 4.5 million words contained in the USPTO trademark register used to describe goods and services during 1980-2012,2 and identify as ”significant innovations” those tokens that are re-used frequently We observe both the first occurrence of a token in this word corpus by an ”innovator” and its diffusion among the trademark filings of all ”follower” firms and entities within one year of first use. Contingent on previous diffusion from the sending to the receiving ZIP code, we find that geographic distance still exerts a strong, negative affect on the intensity (extent) of diffusion between ZIP codes If anything, this effect has grown stronger over time according to our results.
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