Research


Working Papers

Inventor mobility is widely viewed as an important channel of knowledge diffusion across firms. Yet the innovation gains observed at receiving firms could instead reflect sorting if displaced inventors move to firms already on an upward innovation trajectory. The two explanations are difficult to separate because hiring responds to firms' own demand for innovation. To distinguish between them, I exploit 237 U.S. mass layoffs between 2000 and 2016 as plausibly exogenous shocks to inventor displacement and trace the subsequent innovation of incumbent inventors already employed at the receiving firms. The empirical design is an event study centered on each incumbent's first exposure to a displaced colleague. Exposure increases the probability that an incumbent produces a highly novel patent by 1.5 percentage points (about one quarter relative to baseline). The effect builds gradually and persists. It does not increase citations per patent, suggesting that exposure redirects inventive search rather than increasing the impact of individual inventions. The spillover interpretation is further supported by three findings. The response is absent following ordinary experienced hires, increases with exposure intensity, and is substantially larger among incumbents whose technological expertise overlaps with that of the arriving displaced inventors. This concentration remains within the same receiving firm and year after absorbing firm-wide innovation and hiring shocks. Taken together, the evidence favors a knowledge-spillover interpretation over broad destination sorting and suggests that inventor mobility generates positive innovation externalities for incumbent inventors within receiving firms.


Work in Progress