Max Planck Institute for Innovation and Competition, Munich, Room 313
We show that the historical rollout of public libraries increased the innovation output of recipient towns. Between 1886 and 1919, Andrew Carnegie donated $34.5 million (approximately $1 billion in 2019 dollars) to fund the construction of more than 1,500 public libraries across the United States. Drawing on a new data set based on original historical records, we identify cities that qualified to receive a library grant, applied for the program, received preliminary construction approval, but ultimately rejected Carnegie’s offer. Using the rejecting cities as a control group, we estimate the effects of Carnegie library formation on patenting activity. We provide evidence that the trends in the patenting activity in the two groups are indistinguishable before the construction of the libraries and then diverge. Cities that received grants experienced both short- and long-run gains in patenting activity.
Contact Person: Dr. Rainer Widmann