The dynamics of the inventor network in German biotechnology: geographic proximity versus triadic closure

Economic geography has developed a stronghold analyzing how geography impacts innovation. Yet, despite increased interest in networks, a critical assessment of the role of geography in the evolution of networks is still lacking. This article attempts to explore the interplay between geographic distance and triadic closure as two main forces that drive the evolution of collaboration networks. Analyzing the evolution of inventor networks in German biotechnology, the article theoretically argues and empirically demonstrates that-as the technological regime of an industry changes over time-inventors increasingly rely on network resources by forming links to partners of partners, while the direct impact of geographic distance on tie formation decreases. Although initially triadic closure reinforces the geographic distance effect by closing triads among proximate inventors, over time triadic closure becomes an increasingly powerful vehicle to generate longer distance collaboration ties as the effect of geographic proximity decreases.