Innovation and diversity: The role of knowledge networks in the inventive capacity of cities

The aim of this paper is twofold. First, it aims to investigate whether the structure of knowledge networks (within and across urban areas) is important for the inventive capacity of cities. Second, it analyses whether the diversity and variety of the industrial structures of cities influence local knowledge networks and, consequently, foster invention. The research analyses co-patenting activities at firm level in the Italian provinces during the period 2004-2016. Patents data have been retrieved from the European Patent Office PATSTAT database. Results show that agglomeration economies of inventors are the most important force in fostering local invention capacity. However, the structure of knowledge networks also impact on invention productivity. Moreover, either the impact of agglomeration economies of inventors or the structure of knowledge networks on local invention capacity increases when there is greater variety in the local industrial structure.