A Dynamic Network Approach to Breakthrough Innovation

Abstract: This paper outlines a framework for the study of innovation that treats discoveries as additions to evolving networks. As inventions enter they expand or limit the reach of the ideas they build on by influencing how successive discoveries use those ideas. The approach is grounded in novel measures of the extent to which an innovation amplifies or disrupts the status quo. Those measures index the effects inventions have on subsequent uses of prior discoveries. In so doing, they characterize a theoretically important but elusive feature of innovation. We validate our approach by showing it: (1) discriminates among innovations of similar impact in analyses of U.S. patents; (2) identifies discoveries that amplify and disrupt technology streams in select case studies; (3) implies disruptive patents decrease the use of their predecessors by 60% in difference-in-differences estimation; and, (4) yields novel findings in analyses of patenting at 110 U.S. universities.