Innovation and firm value: An investigation of the changing role of patents, 1985-2007

Journal Article (Journal Article)

This paper examines how the relationship between firm value and patent-based indicators of inventive activity has changed over time. We use data from more than 33,000 mergers and acquisitions deals between 1985 and 2007, and distinguish between American (USPTO) and European (EPO) patents. Our results indicate that over time EPO patents have become the dominant indicator of innovative activity, while USPTO patents have no effect on firm value near the end of the sample period. The results are robust to controlling for citations and are especially strong for small firms, for firms operating in the drug and chemical industries, and when target and acquiring firms operate in different industries or countries. JEL classificationO31O32O16 © 2013 Elsevier B.V. All rights reserved.

Full Text

Duke Authors

Cited Authors

  • Belenzon, S; Patacconi, A

Published Date

  • January 1, 2013

Published In

Volume / Issue

  • 42 / 8

Start / End Page

  • 1496 - 1510

International Standard Serial Number (ISSN)

  • 0048-7333

Digital Object Identifier (DOI)

  • 10.1016/j.respol.2013.05.001

Citation Source

  • Scopus