This paper exploits a panel dataset of researchers that includes all inventors listed on U.S. patents since 1975 to investigate the determinants of teamwork in industrial R&D. We document a rise in team size and an increase in repeated collaboration among team members, i.e. team persistence. We also document substantial variation in team size and persistence across technological fields, regions, and
countries. The focus of the paper is a test of a model of dynamic team formation where a firm must choose and then over time rebalance a teamís constitution taking into account the gains to specialization, the costs of coordination, technological change, and the risks that
employee members of the research team will appropriate the firmís intellectual property. We use variation in policy towards noncompete agreements in employment contracts to identify the effect of researcher mobility and IP appropriation on team formation. We find that where researcher job mobility is low, teams tend to be larger and
are more likely to repeat. This evidence we argue suggests that in assembling R&D teams, firms are sensitive to the costs of appropriation and coordination.