Job Market Paper

Bread Upon the Waters: Corporate Science and the Use of Follow-on Public Research.

Why do firms produce scientific research that becomes publicly available, including to their rivals? An important but hitherto ignored benefit is that it can influence the direction of research conducted by external scientists in ways that benefit the focal firm. I show that scientists who build upon a firm’s publications produce follow-on findings, which then feed into the future innovations of the firm. To account for the unobserved quality of the science involved, I develop a new instrumental variable that relies on the quasi-random assignment of accepted manuscripts to specific issues of scientific journals. Some publications attract more academic attention simply because they appear alongside contributions from prominent authors in the same journal issue. Using data on scientific publications by public firms between 1990 and 2012, I find that follow-on research not only drives firms’ subsequent investments in science but also improves their patenting outcomes. The benefits are more pronounced for technological leaders, firms with complementary assets, and those operating in emerging research fields. In addition to being a valuable input into the firm’s innovations, follow-on research also helps validate the quality of the firm’s internal science, especially when there is greater uncertainty. My findings contribute to the understanding of why firms participate in public science.

Winner of the 2023 Best Paper Award in Memory of Paul A. David, the Workshop on the Organization, Economics and Policy of Scientific Research (Max Plank Institute for Innovation and Competition).

Presented at the Workshop on The Organization, Economics and Policy of Scientific Research (Munich, April 2023), The Open Innovation in Science (OIS) Research Conference (Vienna, May 2023), Strategy Science Conference (Munich, June 2023) and the 2023 CCC Doctoral Conference (St. Gallen, June 2023).

Journal Publications

When Does Patent Protection Spur Cumulative Research Within Firms? (with Ashish Arora, Sharon Belenzon and Matt Marx), Ahead of print Journal of Law, Economics and Organization. (doi: 10.1093/jleo/ewad006)

We estimate the effect of patent protection on follow-on investments in corporate scientific research. We exploit a new method for identifying an exogenous reduction in the protection a granted patent provides. Using data on public, research-active firms between 1990 and 2015, we find that firms respond to a decrease in patent protection by reducing follow-on research, as measured by a drop in internal citations to an associated scientific article. We study this effect across firms with varying commercialization capabilities and across varying thickness levels of markets for technology. We find that the effect is stronger in technologies where patents are traded less frequently. Our findings are consistent with a stylized model whereby patent protection is a strategic substitute for commercialization capability. Our results imply that stronger patents encourage follow-on research, but also shift the locus of research from big firms toward smaller firms and startups. As patent protection has strengthened since the mid-1980s, our results help explain why the American innovation ecosystem has undergone a growing division of innovative labor, where startups become important sources of new ideas.

Pre-PhD Policy Publications

Israeli Agri-tech and Indian Agricultural Challenges: Recommendations for an Updated Governmental Policy, Milken Innovation Center, 2018.

Regional Population Scenarios for the State of Israel 2015-2040 (with Shmuel Abramzon), Prime Minister Office of Israel, 2017.