Fundamentals or Population Dynamics and the Geographic Distribution of U.S. Biotechnology Enterprises, 1976-1989

Lynne Zucker (), Michael Darby () and Yusheng Peng

No 6414, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Population ecology models are elegant in form and adequate in describing aggregate data, but poor in telling stories and predicting the location of growth. Fundamentals models emphasizing the variables central to resource mobilization, such as intellectual human capital, can predict where and when biotechnology enterprises emerge and agglomerate. Density dependence and previous founding dependence proxy many underlying processes; the legitimation and competition interpretation is more conjectural than empirically tenable. We argue and demonstrate for biotechnology that an alternative model based on the fundamentals related to resource reallocation and mobilization provides a stronger frame to explore industry formation. Fundamentals models outperform population ecology models in the estimations, while a combined model driven by fundamentals but incorporating weak population dynamics does best. In repeated dynamic simulations, the population ecology model predictions are essentially uncorrelated with the panel data on biotechnology entry by year and region while the combined model has correlation coefficients averaging above 0.8.

JEL-codes: O31 R12 (search for similar items in EconPapers)
Date: 1998-02
Note: PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published as Lynne G. Zucker and Michael R. Darby, “Capturing Technological Opportunity Via Japan's Star Scientists: Evidence from Japanese Firms' Biotech Patents and Products,” Journal of Technology Transfer , January 2001, 26(1/2): 37-58.

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