The Economic Geography of Tech Talent

The tech talent apple doesn't fall too far from the university tree.
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Microsoft store. (Photo: Michael Kappel/Flickr)

Microsoft store. (Photo: Michael Kappel/Flickr)

Superficially, tech jobs appear to follow talent. A software developer could live anywhere in the world and work. Build a cool city that attracts those types of people and the employers will come. Reality raining on Richard Florida's parade:

It's not that the school has a superior computer-science program, which is good but not better than departments at, say, Carnegie Mellon, MIT, or Waterloo. It's the school's proximity to the industry. Stanford is blocks from where Google CEO Larry Page lives and Steve Jobs died.

That local graduates don't travel too far for employment plays into the hands of conventional migration theory. Most moves occur over short distances. We would expect Microsoft to hire more young talent coming out of the University of Washington in Seattle than from anywhere else.

After tracking the expansion of Google in Pittsburgh (Carnegie Melon University) and Waterloo (University of Waterloo in Ontario, Canada), I figured talent production informed economic geography. Why compete with every other place looking for computer science grads when you could open up shop where the university is located? Turns out, I was wrong.

While researching the economic restructuring of Pittsburgh in the wake of the 1980s steel industry collapse, I learned that knowledge spillovers are more important than talent migration. I learned that knowledge production is more important than tech transfer and entrepreneurial activity. University R&D, not private firm tech innovation, is driving regional economic development.

Such conclusions describe much but explain little. A 2001 piece titled "Comparative Localization of Academic and Industrial Spillovers" captures the geographic logic. Industry R&D distance decay doesn't happen as rapidly as university R&D. Meaning, knowledge production for private industry isn't proximity dependent. However, knowledge produced for the public good at a given university has a strong gravity. In Pittsburgh, that's the pull on Google, not the graduates from Carnegie Mellon University.

Jim Russell, a geographer studying the relationship between migration and economic development, writes regularly for Pacific Standard.

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