The transformative effects of tacit technological knowledge

Sergio Petralia, Tom Kemeny and Michael Storper

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Tacit knowledge – ideas that cannot readily be meaningfully and completely communicated – has long been considered a precursor to scientific and technological advances. Using words and phrases found in the universe of USPTO patents 1940-2020, we propose a new method of measuring tacit knowledge and its progressive codification. We uncover a discontinuity in the production of highly tacit technologies. Before 1980, highly- and less-tacit inventions are evenly distributed among inventors, organizations, scientific domains and subnational regions. After 1980, inventors of highly tacit patents become relatively rare, and increasingly concentrated in domains and locations. The economic payoffs to tacit knowledge also change, as it starts unequally rewarding high-income workers. This suggests a role for tacit knowledge in contributing to the rise in income inequality since 1980.

JEL-codes: O30 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2023-09-01
New Economics Papers: this item is included in nep-cse, nep-his, nep-ino, nep-knm, nep-lab and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:120154

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