Research

👥 with A. Guillouzouic

📚 Abstract

Following Bergeaud et al. (2022), we construct a new measure of proximity between industrial sectors and public research laboratories. Using this measure, we explore the underlying network of knowledge linkages between scientific fields and industrial sectors in France. We show empirically that there exists a significant negative correlation between the geographical distance between firms and laboratories and their scientific proximity, suggesting strongly localized spillovers. Moreover, we uncover some important differences by field, stronger than when using standard patent-based measures of proximity.

🔓 Open access version

👥 with C. Verluise

📚 Abstract

We introduce a new general methodological approach for accurately and consistently retrieving a large set of patents related to specific technologies. We build upon the automated patent landscaping algorithm  by incorporating a tractable amount of human supervision to improve the accuracy and consistency of our results. We demonstrate the efficacy of our approach by applying it to six novel and representative technologies: additive manufacturing, blockchain, computer vision, genome editing, hydrogen storage, and self-driving vehicles.

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with C. Verluise

📢 See also: I3 NBER

📚 Abstract

Innovation is an important driver of potential growth but quantitative evidence on the dynamics of innovative activities in the long-run are hardly documented due to the lack of data, especially in Europe. In this paper, we introduce PatentCity, a novel dataset on the location and nature of patentees from the 19th century using information derived from an automated extraction of relevant information from patent documents published by the German, French, British and US Intellectual Property offices. This dataset has been constructed with the view of facilitating the exploration of the geography of innovation and includes additional information on citizenship and occupation of inventors

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with C. Malgouyres, C. Mazet-Sonilhac and S. Signorelli

📢 See also: LSE Blog

📚 Abstract

Does domestic outsourcing react to technological change? We study the staggered diffusion of broadband internet in France in the 2000s, and show that connected firms increased their outsourcing expenditures while decreasing the diversity of occupations they employ in-house. Meanwhile, employment in non-core occupations became increasingly concentrated in firms specializing in subcontracting services. Finally, we provide evidence that workers in high-skill occupations experienced salary gains from being outsourced, while  workers in low-skill occupations lost out. Overall, we show that the deployment of new technologies stimulated domestic outsourcing in this context, with important implications for labor market inequality.

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion and J. Van Reenen

📢 See also: VoxEU Blog, CentrePiece, Cato Research 

📚 Abstract

We present a framework that can be used to assess the equilibrium impact of regulation on endogenous innovation with heterogeneous firms. We implement this model using  French firm-level panel data where there is a sharp increase in the burden of labor regulations on companies with 50 or more employees. Consistent with the model's qualitative predictions, we find a sharp fall in the fraction of innovating firms just to the left of the regulatory threshold. Furthermore, we find a sharp reduction in the positive innovation response of firms to exogenous demand shocks just below the regulatory threshold. Using the structure of our model we quantitatively estimate parameters and find that the regulation reduces aggregate equilibrium innovation (and growth) by 5.8\% which translates into a consumption equivalent welfare loss of at least 2.3\%, approximately doubling the static losses in the existing literature.  

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion, M. Lequien, M. Melitz and T. Zuber 

📢 See also: Insee Analyse (fr) 

📚 Abstract

We decompose the ``China shock'' into two components that induce different adjustments for firms exposed to Chinese exports: an output shock affecting firms selling goods that compete with similar imported Chinese goods, and an input supply shock affecting firms using inputs similar to the imported Chinese goods. Combining French accounting, customs, and patent information at the firm-level, we show that the output shock is detrimental to firms' sales, employment, and innovation. Moreover, this negative impact is concentrated on low-productivity firms. By contrast, we find a positive effect - although often not significant - of the input supply shock on firms' sales, employment and innovation.

🔓 Open access version
➕ Supplementary Material

 👥 with P. Aghion, T. Boppart, P. Klenow and H. Li

📚 Abstract
Growth has fallen in the U.S. amid a rise in firm concentration. Market share has shifted to low labor share firms, while within-firm labor shares have actually risen. We propose a theory linking these trends in which the driving force is falling overhead costs of spanning multiple products or a rising efficiency advantage of large firms. In response, the most efficient firms (with higher markups) spread into new product lines, thereby increasing concentration and generating a temporary burst of growth. Eventually, due to greater competition from efficient firms, within-firm markups and incentives to innovate fall. Thus our simple model can generate qualitative patterns in line with the observed trends. 

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion, M. Lequien and M. Melitz

📢 See also: NBER digest, Insee Analyse (fr)

📚 Abstract
We analyze how demand conditions faced by a firm in its export markets affect its innovation decisions. We exploit exogenous firm-level export demand shocks and find that firms respond by patenting more; furthermore this response is driven by the subset of initially more productive firms. The patent response arises 2 to 5 years after the shock, highlighting the time required to innovate. In contrast, the demand shock raises contemporaneous sales and employment for all firms regardless of their productivity. This skewed innovation response to common demand shocks arises naturally from a model of endogenous innovation and competition with firm heterogeneity

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with J.B. Eymeoud, T. Garcia and D. Henricot 

📢 See also: VoxEU Blog, Blog BdF (en, fr)

📚 Abstract

We examine how corporate real estate market participants adjust to the take-off of teleworking. We develop an index for the exposure of counties to teleworking in France by combining teleworking capacity with incentives and frictions to its deployment. We find that the valuation of offices declined more in areas more exposed to telecommuting, a pattern that we do not observe for retail assets. In addition, we show that telecommuting increases vacancy, decreases construction, while transaction volumes are not affected. It implies that the drop in price is due to a shift in demand for space. In addition, our result suggests that market participants are expecting the shift to teleworking to durably affect the demand for office space.

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with K. Ito, K. Ikeuchi, C. Criscuolo and J. Timmis

📢 See also: VoxEU Blog

📚 Abstract

This paper explores how changes in both position and participation in Global Value Chain (GVC) networks affect firm innovation. The analysis combines matched patent-firm data for Japan with measures of GVC network centrality and GVC participation using the OECD Inter-Country Input-Output (ICIO) Tables over the period from 1995 to 2011. We find that Japan’s position in GVCs has shifted from being at the core of Asian value chains towards the periphery relative to other countries in the network, i.e., becoming less “central”. We use China’s accession to the World Trade Organization as an instrumental variable for changes in Japanese centrality. Our analysis shows that increases in Japanese sectors’ forward centrality – i.e. as a key supplier - tend to be positively associated with increasing firms’ patent applications in these sectors and that firms in key hubs within GVCs, specifically as key suppliers, appear to benefit from knowledge spillovers from downstream markets 

🔓 Open access version 

👥 with S. Ray

📢 See also: Rue de la Banque (en, fr), Les Echos (fr)

📚 Abstract

We study corporate real estate frictions and its effect on firm dynamics. By linking the adjustment of premises to local relocations, we are able to empirically explore the impact of adjustment costs on labor demand. We set and simulate a general equilibrium model with heterogeneous firms that predicts the response of firms to a productivity shock in the presence of fixed adjustment costs on real-estate. Using a large firm-level database merged with local real estate prices, we then exploit variations in the tax on capital gain to document a causal effect of adjustment costs on firms’ labor demand and derive new results on the causes and implications of firms’ local relocation. 

🔓 Open access version
💥 Online Appendix  
➕ Supplementary Material

👥 with P. Aghion, U. Akcigit, R. Blundell and D. Hemous

📢 See also: VoxEu Blog 

📚 Abstract

In this article, we use cross-state panel and cross-U.S. commuting-zone data to look at the relationship between innovation, top income inequality and social mobility. We find positive correlations between measures of innovation and top income inequality. We also show that the correlations between innovation and broad measures of inequality are not significant. Next, using instrumental variable analysis, we argue that these correlations at least partly reflect a causality from innovation to top income shares. Finally, we show that innovation, particularly by new entrants, is positively associated with social mobility, but less so in local areas with more intense lobbying activities.

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion, T. Boppart, P. Klenow and H. Li

📢 See also: VoxEU Blog, FRBSF Economic Letter, Vie des idées (FR)

📚 Abstract

For exiting products, statistical agencies often impute inflation from surviving products. This understates growth if creatively-destroyed products improve more than surviving ones. If so, then the market share of surviving products should systematically shrink. Using entering and exiting establishments to proxy for creative destruction, we estimate missing growth in US  Census data on non-farm businesses from 1983 to 2013. We find missing growth (i) equaled about one-half a percentage point per year; (ii) arose mostly from hotels and restaurants rather than manufacturing; and (iii) did not accelerate much after 2005, and therefore does not explain the sharp slowdown in growth since then 

🔓 Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion, T. Boppart and S. Bunel

📢 See also: Vie des idées (FR)

📚 Abstract

In this paper we use the same methodology as Aghion et al. (2017) to compute missing growth estimates from creative destruction in France. We find that from 2004 to 2015, about 0.5 percentage point of real output growth per year is missed by the statistical office, which is about the same as what was found in the United States. We look at how missing growth varies across French sectors and regions, and we look at the underlying establishment and firm dynamics. In particular we show that the similar missing growth estimates between France and the United States hide noticeable differences in plant dynamics between the two countries 

🔓 Open access version
➕ Supplementary Material

👥 with J. Raimbault and Y. Potiron

📚 Abstract

In this paper, we extend some usual techniques of classification resulting from a large-scale data-mining and network approach. This new technology, which in particular is designed to be suitable to big data, is used to construct an open consolidated database from raw data on 4 million patents taken from the US patent office from 1976 onward. To build the pattern network, not only do we look at each patent title, but we also examine their full abstract and extract the relevant keywords accordingly. We refer to this classification as semantic approach in contrast with the more common technological approach which consists in taking the topology when considering US Patent office technological classes. Moreover, we document that both approaches have highly different topological measures and strong statistical evidence that they feature a different model. This suggests that our method is a useful tool to extract endogenous information. 

🔓  Open access version
💥 Online Appendix
➕ Supplementary Material

👥 with P. Aghion, G. Cette, R. Lecat and H. Maghin

📢 See also: VoxEU Blog, Blog BdF (fr)

📚 Abstract

We identify two counteracting effects of credit access on productivity growth: on the one hand, better access to credit makes it easier for entrepreneurs to innovate; on the other hand, better credit access allows less efficient incumbent firms to remain longer on the market, thereby discouraging entry of new and potentially more efficient innovators. We first develop a simple model of firm dynamics and innovation-base growth with credit constraints, where the above two counteracting effects generate an inverted-U relationship between credit access and productivity growth. Then we test our theory on a comprehensive French manufacturing firm-level dataset. We first show evidence of an inverted-U relationship between credit constraints and productivity growth when we aggregate our data at sectoral level. We then move to firm-level analysis, and show that incumbent firms with easier access to credit experience higher productivity growth, but that they also experienced lower exit rates, particularly the least productive firms among them. To support these findings, we exploit the 2012 Eurosystem’s Additional Credit Claims program as a quasi-experiment that generated exogenous extra supply of credits for a subset of incumbent firms. 

🔓 Open access version