The role of interregional and inter-sectoral knowledge spillovers on regional knowledge creation across US metropolitan counties

This paper relies on a regional knowledge production function to examine the heterogeneous determinants of knowledge creation across five US manufacturing sectors and 853 metropolitan counties over the period 2001-08. Using a Tobit model with state fixed effects, the results indicate that local intra- and inter-sectoral research and development (R&D) investments by the private sector as well as university R&D play a key role in knowledge creation across all sectors under study. We also find that the role of short- versus long-distance interregional spillovers on knowledge creation varies greatly across sectors. These key features improve the design of future local and national innovation policies.