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Mapping Firms' Locations in Technological Space: A Topological Analysis of Patent Statistics

Emerson G. Escolar, Yasuaki Hiraoka, Mitsuru Igami, Yasin Ozcan

arXiv 31 Aug 2019 · Econometrics · publishedResearch Policy (2020) · 4 citations (OpenAlex)

arXiv:1909.00257 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Where do firms innovate? Mapping their locations and directions in technological space is challenging due to its high dimensionality. We propose a new method to characterize firms' inventive activities via topological data analysis (TDA) that represents high-dimensional data in a shape graph. Applying this method to 333 major firms' patents in 1976--2005 reveals substantial heterogeneity: some firms remain undifferentiated; others develop unique portfolios. Firms with unique trajectories, which we define and measure graph-theoretically as "flares" in the Mapper graph, perform better. This association is statistically and economically significant, and continues to hold after we control for portfolio size, firm survivorship, industry classification, and firm fixed effects. By contrast, existing techniques -- such as principal component analysis (PCA) and Jaffe's (1989) clustering method -- struggle to track these firm-level dynamics.

Citation extraction

35
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distinct cited
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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Jaffe, Adam (1989) Characterizing the “technological position” of firms, with application to quantifying technological opportunity and research spi…0.73732100%
2Singh, Gurjeet, Mémoli, Facundo, Carlsson, Gunnar (2007) Topological methods for the analysis of high dimensional data sets and 3d object recognition.0.5112250%
3Azoulay, Pierre, Fons-Rosen, Christian, Graff Zivin, Joshua S (2019) Does Science Advance One Funeral at a Time?0.40511100%
4Berry, Steven, Levinsohn, James, Pakes, Ariel (1995) Automobile prices in market equilibrium0.40511100%
5Bar, Talia, Leiponen, Aija (2012) A measure of technological distance0.40511100%
6Benner, Mary, Waldfogel, Joel (2008) Close to you? Bias and precision in patent-based measures of technological proximity0.40511100%
7Bloom, Nicholas, Schankerman, Mark, Van Reenen, John (2013) Identifying Technology Spillovers and Product Market Rivalry0.40511100%
8Cohen, Wesley M., Hall, Bronwyn H., Rosenberg, Nathan (2010) Fifty Years of Empirical Studies of Innovative Activity and Performance0.40511100%
9Ericson, Richard, Pakes, Ariel (1995) Markov-perfect industry dynamics: A framework for empirical work0.40511100%
10Jaffe, Adam (1986) Technological Opportunity and Spillovers of R&D: Evidence from Firms' Patents, Profits, and Market Value0.40511100%

Showing the top 10 of 35 scored citations.