R&D, Socio-Economic Conditions, and Regional Innovation in the U.S

This paper looks at the genesis of innovation in the U.S. from a territorial perspective. The analysis aims to disentangle the impact of local research and development (R&D) expenditure from other contextual conditions supportive of the process of innovation. Particular emphasis is devoted to the role of socio-economic factors and systems of innovation (“social filter” conditions) and to their impact on the returns of R&D expenditure in different territorial contexts. The empirical analysis is based on a regional knowledge production function approach, leading to an empirical model estimated by means of panel data analysis for the period between 1994 and 2007 at the U.S. Bureau of Economic Analysis-Economic Area level. The results unveil the complexity of the territorial dynamics of innovation of the U.S. Local R&D investments are important predictors for regional innovative performance and their impact is highly localised. However, social filter conditions are fundamental for the productivity of innovation efforts.