Andrews, Michael2021-06-082021-06-082019-10-28Andrews, Michael; Bar Talk: Informal Social Interactions, Alcohol Prohibition, and Invention; Economic History Workshop, 2019; https://economics.yale.edu/event/bar-talk-informal-social-interactions-alcohol-prohibition-and-invention#sthash.P95qCcAW.F7aML5iv.dpbshttp://hdl.handle.net/11603/21710Economic History Workshop, 28 Hillhouse Ave., Monday, October 28, 2019 - 4:00pmTo understand the importance of informal social networks for invention, I examine one of the largest involuntary disruptions of social networks in U.S. history: alcohol prohibition. The enactment of state-level prohibition laws differentially treated counties depending on whether those counties were wet or dry prior to prohibition. After the imposition of state-level prohibition, previously wet counties had 8-18% fewer patents per year relative to consistently dry counties. The effect was largest in the first three years after the imposition of prohibition and rebounds thereafter. The effect was smaller for groups that were less likely to frequent saloons, namely women and particular ethnic groups. I present evidence that the effect was driven by the disruption of social interactions and rule out alternative explanations. I next use the prohibition experiment to document several facts. I show that the social network increases invention through exposure to ideas in addition to exposure to collaborators and that informal and formal connections are complements in the invention production function. Finally, I show that the social network exhibits path dependence in the sense that as individuals rebuilt their social networks following prohibition, they connected with new individuals and patented in new technology classes. While prohibition had only a temporary effect on the rate of invention, the fact that the post-prohibition network exposed individuals to different ideas means that prohibition had a lasting effect on the direction of inventive activity.86 pagesen-USThis item is likely protected under Title 17 of the U.S. Copyright Law. Unless on a Creative Commons license, for uses protected by Copyright Law, contact the copyright holder or the author.importance of informal social networks for inventiondisruptions of social networksalcohol prohibitionText