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Where Have All the "Creative Talents" Gone? Employment Dynamics of US Inventors

Author

Listed:
  • Ufuk Akcigit
  • Nathan Goldschlag
Abstract
How are inventors allocated in the US economy and does that allocation affect innovative capacity? To answer these questions, we first build a model where an inventor with a new idea has the possibility to work for an entrant or incumbent firm. Strategic considerations encourage the incumbent to hire the inventor, offering higher wages, and then not implement her idea. We then combine data on 760 thousand U.S. inventors with the LEHD data. We find that when an inventor is hired by an incumbent, their earnings increases by 12.6 percent and their innovative output declines by 6 to 11 percent.

Suggested Citation

  • Ufuk Akcigit & Nathan Goldschlag, 2023. "Where Have All the "Creative Talents" Gone? Employment Dynamics of US Inventors," Working Papers 23-17, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:23-17
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    References listed on IDEAS

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    1. Brent Neiman, 2014. "The Global Decline of the Labor Share," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(1), pages 61-103.
    2. Akcigit, Ufuk & Pearce, Jeremy & Prato, Marta, 2020. "Tapping into Talent: Coupling Education and Innovation Policies for Economic Growth," CEPR Discussion Papers 15318, C.E.P.R. Discussion Papers.
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    4. Ufuk Akcigit & Salomé Baslandze & Francesca Lotti, 2023. "Connecting to Power: Political Connections, Innovation, and Firm Dynamics," Econometrica, Econometric Society, vol. 91(2), pages 529-564, March.
    5. Lucia Foster & John C. Haltiwanger & C. J. Krizan, 2001. "Aggregate Productivity Growth: Lessons from Microeconomic Evidence," NBER Chapters, in: New Developments in Productivity Analysis, pages 303-372, National Bureau of Economic Research, Inc.
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    7. Ufuk Akcigit & William R. Kerr, 2018. "Growth through Heterogeneous Innovations," Journal of Political Economy, University of Chicago Press, vol. 126(4), pages 1374-1443.
    8. Ufuk Akcigit & John Grigsby & Tom Nicholas, 2017. "The Rise of American Ingenuity: Innovation and Inventors of the Golden Age," Working Papers 2017-6, Princeton University. Economics Department..
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    12. David Argente & Salomé Baslandze & Douglas Hanley & Sara Moreira, 2020. "Patents to Products: Product Innovation and Firm Dynamics," FRB Atlanta Working Paper 2020-4, Federal Reserve Bank of Atlanta.
    13. Ufuk Akcigit, 2017. "Economic Growth: The Past, the Present, and the Future," Journal of Political Economy, University of Chicago Press, vol. 125(6), pages 1736-1747.
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    Cited by:

    1. Akcigit, Ufuk & Chhina, Raman & Cilasun, Seyit Mümin & Miranda, Javier & Serrano-Velarde, Nicolas & Ocakverdi, Eren, 2023. "Intuit QuickBooks Small Business Index: A New Employment Series for the US, Canada, and the UK," CEPR Discussion Papers 18402, C.E.P.R. Discussion Papers.
    2. Karam Jo & Seula Kim, 2024. "Competition, Firm Innovation, and Growth under Imperfect Technology Spillovers," Working Papers 24-40, Center for Economic Studies, U.S. Census Bureau.
    3. Bräuer, Richard, 2024. "Searching where Ideas Are Harder to Find – The Productivity Slowdown as a Result of Firms Hindering Disruptive Innovation," IWH Discussion Papers 22/2023, Halle Institute for Economic Research (IWH), revised 2024.
    4. Kox, Henk L.M., 2023. "Testing an extended knowledge-capital model of foreign direct investment," MPRA Paper 117266, University Library of Munich, Germany.
    5. Timmermans, Oscar, 2024. "Cash versus share payouts in relative performance plans," LSE Research Online Documents on Economics 123696, London School of Economics and Political Science, LSE Library.

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    More about this item

    Keywords

    Inventors; innovation; R&D; firms; dynamism; reallocation;
    All these keywords.

    JEL classification:

    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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