How do inventors’ political preferences affect innovation?

Abstract

Political polarization has been increasing over time. Concurrently, the role of team-based innovation in economic growth has become increasingly important. This paper examines how inventors’ political leanings affect innovation. First, we explore how inventors’ political preferences affect the formation of co-invention teams within organizations. Second, we examine whether politically homogeneous teams perform better or worse than politically heterogeneous teams in terms of innovative output. To examine these questions, we match inventors in the USPTO patent database to their voter registration records, which contains not only their political affiliation, but also their level of political engagement. We also geolocate each patent assignee/employer of every inventor to create a “risk set” of potential collaborators for a focal inventor. Using a variety of estimation techniques, we describe both the regularities in the data and results from econometric analysis. We show that there is indeed homophily on innovation teams: Democrats tend to avoid partnering with Republicans, and vice versa. We find modest evidence that politically heterogeneous teams outperform homogenous teams in terms of patenting success, but causal effects must be interpreted cautiously as they are sensitive to the instrumentation used.