Local Academic Knowledge Transfers and the Concentration of Economic Activity

In this paper I examine agglomeration effects on the intensity of local knowledge transfers from universities to high technology innovations within the modified Griliches-Jaffe knowledge production function framework. Estimations are carried out at the level of U.S. metropolitan areas. Concentration of high technology employment turns out to be the most important factor promoting local academic knowledge transfers. I find that a "critical mass" of agglomeration must be reached in order to expect substantial local economic effects of academic research spending.