Does the location of ideas matter for employment and earnings in the Internet age?

Freeman talked about the development of ideas and their impact on U.S. workers. It used to be the case that the place where new knowledge was created had an advantage in commercializing it. But Freeman argues that modern communications technologies allow new ideas rapid exposure on a world stage, where the ever-growing numbers of technically skilled workers in developing countries stand capable of turning them into profit-making opportunities. Freeman emphasizes the need for policies that foster knowledge creation in areas where the home-field advantage can be maintained. He says that the U.S. ought to encourage research and development in areas that have more “stickiness”—that is, invest more in those areas of science where there is some natural advantage for the commercialization to occur in the U.S. He also advises that we create more “stickiness” in basic knowledge creation, for example, by enacting stronger patent protection, to increase the likelihood that U.S. firms are the ones commercializing innovative science.