Published online by Cambridge University Press: 18 June 2008
Recent research shows that the Internet, by sharply reducing the real costs of sharing information, has profoundly impacted collaboration between faculty in different departments. Using information on spatial-temporal Bitnet connections, Agrawal and Goldfarb (2006) find that Internet connectivity increased collaboration between those connected universities by 85%. Extensively analyzing faculty productivity at the top 25 universities during the last three decades, Kim, Morse, and Zingales (2006) report that the Internet has significantly lowered department-specific research externalities in economics and finance by giving those outside of top schools access to productive research colleagues within top schools. Concomitant with this decline in location-specific externalities, they also report that salaries at those top universities have increased since the universities are less able to appropriate any rent based on research productivity created by physically being located at that university. One of the reasons that physical location is less important is e-mail. Walsh and Maloney (2003), using information from four fields (experimental biology, mathematics, physics, and sociology), find that e-mail has significantly reduced coordination problems in research collaboration.