The purpose of this project is to develop a deeper understanding of technical change by examining the patterns in the location of invention in the U.S. manufacturing sector between 1870 and 1929, a period of integration of national product markets as well as of radical changes in technology and in industrial structure. The issue of the location of invention will be explored in two different senses of the term. First, the basic quantitative record of the geographic distribution of patenting over the period, as well as a better understanding of the basis for, and prevalence of, the phenomenon of geographic clustering in inventive activity will be established. Although there has been much interest by scholars and policy makers in the importance of local externalities in invention, and many anecdotal references to cases such as Silicon Valley, there has to date been only limited systematic empirical investigation of the subject. Second, the study will analyze the extent to which inventive activity was located within the firms that actually used the technology. It is conventional to think of invention as an activity that occurs within the boundaries of the firms, but at various times firms have bought or licensed much of their technology from outside suppliers. This research is important because it will shed new light on the processes of innovation and the diffusion of new technology.
