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Three Essays on Human Capital and Innovation in the United States

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Three Essays on Human Capital and Innovation in the United States Three Essays on Human Capital and Innovation in the United States DISSERTATION Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the Graduate School of The Ohio State University By Kathryn Rose Dotzel, M.S. Graduate Program in Agricultural, Environmental, and Development Economics The Ohio State University 2017 Dissertation Committee: Alessandra Faggian Mark D. Partridge Joyce J. Chen Copyrighted by Kathryn Rose Dotzel 2017 Abstract This research investigates three topics related to human capital and innovation in the United States. The primary objective of the first chapter is to examine the influence of natural amenities on student migration decisions using institution-level data from the National Center for Education Statistics’ Integrated Postsecondary Education Data System. This study surpasses the scope of previous research focused on natural amenities, which rely on a limited selection of state-level measures, by matching interpolated weather station- and county-level climate data to each post-secondary institution. Results suggest that students consider natural amenities in their migration to college decision and, in some cases, preferences for natural amenities vary based on origin state amenity conditions. Nonetheless, migration decisions are dominated by origin state educational opportunities and by proximity of the student’s origin state to the state of college attendance. The second chapter separately examines the relationship between knowledge management and innovation in rural and urban businesses in the United States using data from the Economic Research Service’s 2014 Rural Establishment Innovation Survey and a series of logit and multivariate probit regression models. The focus is on two facets of knowledge management: (1) innovative search strategy, i.e., which sources firms target for information that supports the development of new and improved products and production processes, and (2) the integration of technologies that facilitate data-driven decision-making and the dissemination of ii knowledge among employees, suppliers, and customers. Existing studies in the knowledge management literature principally examine firms in a single industry, overwhelmingly rely on patent data to proxy for innovation, and cannot account for the innovations of rural establishments in the United States. By addressing these limitations, this research provides novel insights into how rural and urban American businesses acquire and use knowledge to support innovative activity. Results indicate that for businesses located in rural regions, extra- industry sources are most important for successful innovation, while intra-industry sources play a more vital role in the innovation processes of urban businesses, suggesting a major difference in optimal innovative search strategy for firms in rural and urban regions. The purpose of the third chapter is to refine and evaluate the occupation-driven approach to analyzing regional invention suggested by Wojan et al. (2015), who argue that patenting rates should be computed on the subset of workers that might plausibly contribute to patenting. We introduce several modifications to their original analysis, including use of a special tabulation of more detailed occupation data and added controls for regional characteristics that could confound identification of the inventive class—the group of occupations most associated with patent production. We then critically evaluate the updated findings by implementing a simultaneous equations model of the interrelationship between the composition and productivity of the inventive class. Substitutions of alternative subpopulations of knowledge workers (i.e., denominators) for the inventive class allow us to assess the value- added of the updated inventive class construct. Simultaneous equations results confirm the existence of an interrelationship between patent production and membership in the inventive class in rural regions and highlight an apparent disarticulation of inventive employment and patent-intensive manufacturing employment in urban areas. iii For my parents iv Acknowledgements As I near the conclusion of my graduate studies, I would like to express my gratitude to the many who have supported and encouraged my academic pursuits. First and foremost, I thank my parents, Adelle and Joseph Dotzel, for their high expectations, willingness to invest in my education and professional growth, and endless patience over the past 27 years. I am immensely grateful for the support I have received from my dissertation committee, particularly my advisor Alessandra Faggian. Alessandra, I cannot thank you enough for your guidance on my research and support of my professional development during my time as your advisee. I thank Mark Partridge for becoming my co-advisor following Alessandra’s move to Italy and for taking on Alessandra’s role as PI on the Northeast Regional Center for Rural Development project, which allowed me to maintain access to critical data used in my thesis. I also thank Mark Partridge and Joyce Chen for their constructive and insightful feedback on my research as a committee members and Ian Sheldon for his participation in my candidacy exam. I additionally appreciate the support I received from teachers and professors prior to graduate school. I thank Bruce Buckle for encouraging me to enroll in AP Economics as a high school senior and for the enthusiasm he brought to class each day. To my professors at Juniata College—particularly my undergraduate advisors, Bradley Andrew and Kimberly Roth, Richard Mahoney, and David Hsiung—as well as Professor Dan Marsh at the University of Waikato: thank you for inspiring me to pursue graduate studies and preparing me to succeed as a graduate student. v I would also like to thank Tim Wojan for his encouragement and guidance as a project leader during my internships at the Economic Research Service and his creativity and support as a co-author; Sarah Low at ERS for her support during and following my internships; Ron Sands for taking time to share insights gained during his career over hot chocolate each summer I was at ERS; as well as David McGranahan, John Pender, Bob Dubman, Andy Toole, Peter Stenberg, David Nulph, Linda Felton, and Loretta Miller, among other ERS employees, for their support. I am likewise indebted to those who assisted me following my move to Ann Arbor in January, including Joel Yoder for setting up a remote connection to my campus computer, Holly Hall and Gina Hnytka for answering questions regarding university policies, and Isha Rajbhandari for delivering my thesis to the Graduate School for format review. I additionally thank my current supervisor at the Environmental Protection Agency, Meg Patulski, for permitting me to take leave to prepare for and attend my thesis defense, and my colleagues at EPA, including Gary Dolce, Daniel Bizer-Cox, and Laura Berry, for their kindness and support over the past few months. To my fellow cohort members—particularly Elizabeth Botkins, Isha Rajbhandari, Khushbu Mishra, Tony Gallenstein, and Nicholas Irwin—thank you for your friendship, insight, and positivity over the past five years. I could not have reached this milestone without you. Finally, I would like to thank everyone who proofread or provided comments on earlier drafts of these essays, including discussants and session participants at the 2014, 2015, and 2016 North American Regional Science Council meetings, committee members, reviewers, colleagues, friends, and family. Research presented in Chapter 2 is supported by a grant from Pennsylvania State University’s Northeast Regional Center for Rural Development. vi Vita June 2008 ............................................................. Graduate of Montoursville Area High School, Montoursville, PA May 2012 ............................................................. B.S. Mathematics with a secondary emphasis in Economics, Juniata College, Huntingdon, PA 2012–2013 ........................................................... Graduate Enrichment Fellow, The Ohio State University, Columbus, OH 2013–2014 ........................................................... OARDC Minority Associate, The Ohio State University, Columbus, OH August 2014 ......................................................... M.S. Agricultural, Environmental, and Development Economics, The Ohio State University, Columbus, OH Summer 2014, 2015, 2016 ................................... Student Trainee (Economics), Resource and Rural Economics Division, Economic Research Service, U.S. Department of Agriculture, Washington, DC 2014–2015, 2016–2017 ....................................... Graduate Research Associate, Dept. of Agricultural, Environmental, and Development Economics, The Ohio State University, Columbus, OH vii 2015–2016 ........................................................... Graduate Teaching Associate, Dept. of Agricultural, Environmental, and Development Economics, The Ohio State University, Columbus, OH 2017–present ....................................................... Economist, Transportation and Climate Division, Office of Transportation and Air Quality, U.S. Environmental Protection Agency, Ann Arbor, MI Publications Braun, B., Chen, J. J., Dotzel, K. R., & Jenkins, J. C. (2016). Climate change and migration in the coastal zone of Bangladesh. Geographische Rundschau, July/August, 10–25. Dotzel, K. R. (2016). Do natural amenities influence undergraduate student migration decisions? The Annals of
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